H.B. 793 Summary

• Temporarily suspends general excise and use tax exemptions for 22 categories of previously exempt income and transactions from January 1, 2012, through June 30, 2015, to address a projected $1.2 billion state revenue shortfall.

• Imposes a 4% tax rate on previously exempt gross income and proceeds, including amounts from contractors, federal cost-plus contracts, telecommunications services, agricultural commodities, maritime services, aircraft rentals, and nonprofit convention revenues.

• Excludes from the temporary tax: gross income from binding written contracts entered into before July 1, 2011 that prohibit tax increases, services provided by wholly owned subsidiaries, and amounts that cannot be legally taxed under the U.S. Constitution or federal law.

• Requires the director of taxation to implement information reporting requirements on all exclusions and exemptions from the general excise and use taxes, with limited exceptions.

• Appropriates funds to the Department of Taxation for fiscal year 2011-2012 to implement procedures necessary to expedite the tax provisions of the Act.