Pennsylvania Act 1945-360 — "CO-OPERATIVE AGRICULTURAL ASSOCIATION CORPORATE NET INCOME TAX ACT"

Act text

AN ACT

To provide revenue for State purposes by imposing an excise tax on the net income of co-operative agricultural associations having capital stock, in lieu of all other taxes, except tax on real estate; providing for the assessment, collection, settlement and resettlement of tax, and reviews and appeal therefrom; conferring powers and imposing duties on certain persons, co-operative agricultural associations having capital stock, State and county officers, boards and departments; and providing penalties.

TABLE OF CONTENTS

Section 1. Short title.

Section 2. Definitions.

Section 3. Imposition of tax.

Section 4. Report and Payment of Tax.

Section 5. Extension of Time to File Reports.

Section 6. Settlement and Resettlement.

Section 7. Enforcement; Rules and Regulations; Inquisitorial

Powers of the Department.

Section 8. Retention of Records by Associations; Penalty.

Section 9. Penalty.

Section 10. Constitutional Construction.

Section 11. Effective date.

The General Assembly of the Commonwealth of Pennsylvania hereby enacts as follows:

Section 1. This act shall be known and may be cited as the "Co-operative Agricultural Association Corporate Net Income Tax Act."

Section 2. Definitions.--The following words, terms and phrases, when used in this act, shall have the meaning ascribed to them in this section, except where the context clearly indicates a different meaning.

"Co-operative Agricultural Association."--An incorporated, co-operative agricultural association, composed of persons engaged in agriculture and instituted for the purposes of mutual help, having capital stock, either organized under the laws of this Commonwealth, the United States, or any state, territory or foreign country, or dependency, and doing business in this Commonwealth, or having capital or property employed or used in this Commonwealth by or in the name of itself, or any person, partnership or association.

"Association."--Any co-operative agricultural association as hereinbefore defined.

"Department."--The Department of Revenue of this Commonwealth.

"Net Income."--In case the entire business transacted by the association is transacted within this Commonwealth, net income for the calendar year or fiscal year shall be only an amount equal to the sum of the dividends declared, or declared and paid on the shares of common and preferred stock during the year.

In case the entire business is not transacted by the association within this Commonwealth, the tax imposed by this act shall be based upon such portion of the net income for the calendar or fiscal year, as defined herein, as shall be attributed to business transacted in this Commonwealth by multiplying such net income by a fraction, of which the numerator is the gross receipts received from business transacted within the Commonwealth, and of which the denominator is the amount of the gross receipts received from all the business.

Section 3. Imposition of Tax.--Every association shall be subject to, and shall pay for, the privilege of doing business in this Commonwealth, or having capital or property employed or used in the Commonwealth, by, or in the name of itself, or any other person, partnership or association, a State excise tax at the rate of four per centum (4%) per annum upon each dollar of the net income, which tax shall be collected in lieu of any other excise tax except liquid fuel taxes, fuel use taxes, sales and use taxes on registered motor vehicles and unemployment compensation fund contributions but including corporate net income tax or property tax. Nothing contained herein shall be construed to impose an excise tax upon any subject of taxation when such subject of taxation is specifically exempted under the statute levying the excise tax. The property shall be free from any county tax excepting tax on real estate.

(3 amended Mar. 3, 1982, P.L.126, No.41)

Section 4. Report and Payment of Tax.--For the purpose of ascertaining the amount of tax payable under this act, it shall be the duty of every association liable to pay tax under this act, on or before the fifteenth day of April of each year, to transmit to the department upon a form prescribed, prepared and furnished by the department, a report under oath or affirmation, of its president, vice-president or other principal officer and of its treasurer or assistant treasurer of net income taxable under the provisions of this act.

The failure of any association liable to pay tax under this act to procure or receive any report form shall not excuse it from making a report. Every association, upon the date its report is required herein to be made, shall pay to the department the tax due to the Commonwealth by it for the preceding year.

The amount of the tax imposed under this act not paid on or before the time, as above provided, shall bear interest at the rate of six per centum (6%) per annum from the date it is due and payable until paid: Provided, however, That any association may pay the full amount of such tax, or any part thereof, together with interest due to the date of payment, without prejudice to its right to present and prosecute a petition for resettlement, a petition for review, or an appeal to court. If it be thereafter determined that such taxes were overpaid the department shall enter a credit to the account of such association which may be used by it in the manner prescribed by law.

If the officers of any association shall neglect or refuse to make any report, as herein required, or shall knowingly make any false report, an additional ten per centum (10%) of the amount of the tax shall be added by the department to the tax determined to be due.

If any association closes its fiscal year not upon the thirty-first day of December, but upon some other date, such association shall certify such fact to the Department of Revenue and shall make the report herein required on or before the fifteenth day of the fourth month after the close of its fiscal year.

Section 5. Extension of Time to File Reports.--The department may, upon application made to it in such form as it shall prescribe, on or prior to the last day for filing any report and upon proper cause shown, grant to the association required to file such report, an extension of not more than sixty (60) days within which such report may be filed, but the amount of tax due shall, in such cases, nevertheless, be subject to interest from the due date and at the rate fixed by this act.

Section 6. Settlement and Resettlement.--(a) All tax due under this act shall be settled by the department and such settlement shall be subject to audit and approval by the Department of the Auditor General and shall, so far as possible, be made so that notice thereof may reach the taxpayer before the end of a year after the tax report was required to be made.

(b) Promptly after the date of any such settlement the department shall send, by mail or otherwise, a copy thereof to such association. The tax imposed by this act shall be settled, resettled and otherwise imposed and adjusted in the same manner within the same periods of time, and right of resettlement, review, appeal and refund as provided by law in the case of capital stock and franchise taxes imposed upon business corporations.

(c) If, within a period of two (2) years after the date of any settlement, the department is not satisfied with such settlement the department is hereby authorized and empowered to make a resettlement of the tax due by such association, based upon the facts contained in the report, or upon any information within its possession, or that shall come into its possession.

Whenever a resettlement shall have been made hereunder, the department shall resettle the account according to law and shall credit or charge, as the case may be, the amount resulting from such resettlement upon the current accounts of the association with which it is made.

The resettlement shall be subject to audit and approval by the Department of the Auditor General, as in the case of original settlement, and in case of the failure of the two departments to agree, the resettlement shall be submitted to the Board of Finance and Revenue, as in the case of original settlements.

(d) If any association shall neglect or refuse to make any report and payment of tax required by this act, the department shall estimate the tax due by such association, and, subject to audit and approval by the Department of Auditor General, settle the amount due by it for tax penalties and interest thereon, as prescribed herein, from which settlement there shall be no right of review or appeal, but the department, with the approval of the Department of Auditor General, may require a report to be filed and thereupon make a settlement based upon such report and cancel the estimated settlement.

Section 7. Enforcement; Rules and Regulations; Inquisitorial Powers of the Department.--(a) The department is hereby charged with the enforcement of the provisions of this act, and is hereby authorized and empowered to prescribe, adopt, promulgate, and enforce rules and regulations not inconsistent with this act relating to any matter or thing pertaining to the administration and enforcement of the provisions of this act, and the collections of tax, penalties and interest imposed by this act. The department is hereby required to have such rules and regulations promulgated and adopted, printed, and shall distribute the same to any person upon request.

(b) The department or any agent, authorized in writing by it, is hereby authorized to examine the books, papers and records, and to investigate the character of the business transacted by any association in order to verify the accuracy of any report made, or if no report was made by such association, to ascertain and settle the tax imposed by this act. Every such association is hereby directed and required to give to the department, or its duly authorized agent, the means, facilities and opportunity for such examinations and investigations as are hereby provided and authorized. Any information gained by the department as a result of any returns, investigations, or verifications required to be made by this act shall be confidential, except for official purposes, and any person divulging such information shall be guilty of a misdemeanor, and upon conviction thereof, shall be sentenced to pay a fine of not less than one hundred dollars ($100), or more than one thousand dollars ($1,000), and costs of prosecution, or to undergo imprisonment for not more than six (6) months, or both, in the discretion of the court.

(c) Whenever any person acting for or on behalf of the department shall, in good faith, institute legal proceedings for any violations of the provisions of this act, and for any reason shall fail to recover costs of record, such costs shall be a charge upon the proper county, as shall such costs in the event defendant is imprisoned for failure to pay fine or costs, or both, and shall be audited and paid as are costs of like character in said county.

(d) The powers conferred by this act upon the department relating to the administration or enforcement of this act shall be in addition to, but not exclusive of, any other powers heretofore or hereafter conferred upon the department by law.

Section 8. Retention of Records by Associations; Penalty.--Each association shall maintain and keep for a period of three (3) years after any report is filed under this act, such record or records of business transacted by it within this Commonwealth for the period covered by such report, and other pertinent papers as may be required by the department.

Any person violating any of the provisions of this section shall be guilty of a misdemeanor and shall, upon conviction thereof, be sentenced to pay a fine not exceeding one thousand dollars ($1,000) and costs of prosecution, or to undergo imprisonment for not more than six (6) months, or both, in the discretion of the court.

Section 9. Penalties.--(a) Any person who shall wilfully make a false and fraudulent return of net income made taxable by this act shall be guilty of willful and corrupt perjury, and upon conviction thereof, shall be subject to punishment as provided by law. Such penalty shall be in addition to any other penalties imposed by this act.

(b) Any person who wilfully fails, neglects, or refuses to make a report, or to pay the tax as herein prescribed, or who shall refuse to permit the department to examine the books, papers and records of any association liable to pay tax under this act, shall be guilty of a misdemeanor, and upon conviction thereof, shall be sentenced to pay a fine not exceeding one thousand dollars ($1,000) and costs of prosecution, or to undergo imprisonment not exceeding six (6) months, or both, in the discretion of the court. Such penalty shall be in addition to any other penalties imposed by this act.

Section 10. Constitutional Construction.--The provisions of this act are severable and if any of its provisions shall be held unconstitutional, the decision of the court shall not affect or impair any of the remaining provisions of this act. It is hereby declared to be the legislative intent that this act would have been adopted had such unconstitutional provisions not been included herein.

Section 11. This act shall become effective immediately upon its final enactment, and its provisions shall be applicable to settlements of tax for the calendar year ending the thirty-first day of December, one thousand nine hundred forty-four, or fiscal year ending in the calendar year one thousand nine hundred forty-five and every year thereafter.