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        PRIOR PRINTER'S NO. 359                       PRINTER'S NO. 2209

THE GENERAL ASSEMBLY OF PENNSYLVANIA


HOUSE BILL

No. 338 Session of 2005


        INTRODUCED BY SCAVELLO, LEH, BENNINGHOFF, ADOLPH, ALLEN,
           ARMSTRONG, BAKER, BALDWIN, BARRAR, BASTIAN, BOYD, BROWNE,
           BUNT, CALTAGIRONE, CAPPELLI, CAUSER, CLYMER, CORNELL,
           CRAHALLA, CREIGHTON, DALLY, DeLUCA, DENLINGER, ELLIS,
           FAIRCHILD, FICHTER, FLICK, FORCIER, GEIST, GEORGE, GINGRICH,
           GOODMAN, GRUCELA, HARHART, HARPER, HARRIS, HENNESSEY,
           HERSHEY, HESS, HICKERNELL, HUTCHINSON, KAUFFMAN, M. KELLER,
           KILLION, LEDERER, LESCOVITZ, MAJOR, MANN, MARSICO, McGEEHAN,
           McGILL, McILHATTAN, McNAUGHTON, METCALFE, MILLARD, S. MILLER,
           MUSTIO, NAILOR, O'NEILL, PETRARCA, PETRI, PHILLIPS, PICKETT,
           PYLE, READSHAW, REICHLEY, ROHRER, RUBLEY, SAINATO, SATHER,
           SCHRODER, SHANER, STERN, R. STEVENSON, TANGRETTI,
           E. Z. TAYLOR, TURZAI, WATSON, WILT, WRIGHT, YOUNGBLOOD,
           SEMMEL, PAYNE, TRUE, J. EVANS, McCALL, MAITLAND, REED, HANNA,
           T. STEVENSON, KENNEY, RAPP, GILLESPIE, HERMAN, GABIG, SONNEY,
           GOOD, J. TAYLOR, ZUG, STAIRS, QUIGLEY, GRELL, NICKOL,
           BIRMELIN, SHAPIRO AND MACKERETH, FEBRUARY 8, 2005

        AS REPORTED FROM COMMITTEE ON FINANCE, HOUSE OF REPRESENTATIVES,
           AS AMENDED, JUNE 14, 2005

                                     AN ACT

     1  Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
     2     act relating to tax reform and State taxation by codifying
     3     and enumerating certain subjects of taxation and imposing
     4     taxes thereon; providing procedures for the payment,
     5     collection, administration and enforcement thereof; providing
     6     for tax credits in certain cases; conferring powers and
     7     imposing duties upon the Department of Revenue, certain
     8     employers, fiduciaries, individuals, persons, corporations
     9     and other entities; prescribing crimes, offenses and
    10     penalties," further providing, in gross receipts tax, for the
    11     imposition of tax; and making a related repeal.

    12     The General Assembly of the Commonwealth of Pennsylvania
    13  hereby enacts as follows:
    14     Section 1.  Section 1101(a), (a.1) and (j) of the act of


     1  March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
     2  1971, amended or added December 23, 2003 (P.L.250, No.46), are
     3  amended to read:
     4     Section 1101.  Imposition of Tax.--(a)  General Rule.--Every
     5  pipeline company, conduit company, steamboat company, canal
     6  company, slack water navigation company, transportation company,
     7  and every other company, association, joint-stock association,
     8  or limited partnership, now or hereafter incorporated or
     9  organized by or under any law of this Commonwealth, or now or
    10  hereafter organized or incorporated by any other state or by the
    11  United States or any foreign government, and doing business in
    12  this Commonwealth, and every copartnership, person or persons
    13  owning, operating or leasing to or from another corporation,
    14  company, association, joint-stock association, limited
    15  partnership, copartnership, person or persons, any pipeline,
    16  conduit, steamboat, canal, slack water navigation, or other
    17  device for the transportation of freight, passengers, baggage,
    18  or oil, except motor vehicles and railroads, and every limited
    19  partnership, association, joint-stock association, corporation
    20  or company engaged in, or hereafter engaged in, the
    21  transportation of freight or oil within this State, and every
    22  telephone company , telegraph company or provider of mobile
    23  telecommunications services now or hereafter incorporated or
    24  organized by or under any law of this Commonwealth, or now or
    25  hereafter organized or incorporated by any other state or by the
    26  United States or any foreign government and doing business in
    27  this Commonwealth, and every limited partnership, association,
    28  joint-stock association, copartnership, person or persons,
    29  engaged in telephone or telegraph business or providing mobile
    30  telecommunications services in this Commonwealth, shall pay to
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     1  the State Treasurer, through the Department of Revenue, a tax of
     2  forty-five mills with a surtax equal to five mills upon each
     3  dollar of the gross receipts of the corporation, company or
     4  association, limited partnership, joint-stock association,
     5  copartnership, person or persons, received from:
     6     (1)  passengers, baggage, oil and freight transported wholly
     7  within this State;
     8     (2)  telegraph or telephone messages transmitted wholly
     9  within this State and telegraph or telephone messages
    10  transmitted in interstate commerce after December 31, 2005 2003,  <--
    11  and before January 1, 2007 2006, where such messages originate    <--
    12  or terminate in this State and the charges for such messages are
    13  billed to a service address in this State, except gross receipts
    14  derived from:
    15     (i)  the sales of access to the Internet, as set forth in
    16  Article II, made to the ultimate consumer; and
    17     (ii)  the sales for resale to persons, partnerships,
    18  associations, corporations or political subdivisions subject to
    19  the tax imposed by this article upon gross receipts derived from
    20  such resale of telecommunications services, including:
    21     (A)  telecommunications exchange access to interconnect with
    22  a local exchange carrier's network;
    23     (B)  network elements on an unbundled basis; and
    24     (C)  sales of telecommunications services to interconnect
    25  with providers of mobile telecommunications services; and
    26     (3)  mobile telecommunications services messages sourced to
    27  this Commonwealth after December 31, 2005 2003, and before        <--
    28  January 1, 2007 2006, based on the place of primary use standard  <--
    29  set forth in the Mobile Telecommunications Sourcing Act (4
    30  U.S.C. § 117), except gross receipts derived from:
    20050H0338B2209                  - 3 -     

     1     (i)  the sales of access to the Internet, as set forth in
     2  Article II, made to the ultimate consumer; and
     3     (ii)  the sales for resale to persons, partnerships,
     4  associations, corporations or political subdivisions subject to
     5  the tax imposed by this article upon gross receipts derived from
     6  such resale of mobile telecommunications services, including
     7  sales of mobile telecommunications services to interconnect with
     8  providers of telecommunications services.
     9     (a.1)  Credit.--Telegraph or telephone companies or providers
    10  of mobile telecommunications services that pay a gross receipts
    11  tax to another state on messages or services after December 31,
    12  2005 2003, and before January 1, 2007 2006, which are taxable     <--
    13  under this article are entitled to a credit against the tax due
    14  under this article. The credit allowed with respect to the
    15  messages or services shall not exceed the tax under this article
    16  with respect to the messages or services.
    17     * * *
    18     (j)  Schedule for Estimated Payments.--
    19     (1)  For calendar year 2004, the following schedule applies
    20  to the payment of the tax under subsection(a)(3):
    21     (i)  Forty per cent of the estimated tax shall be due on
    22  March 15, 2004.
    23     (ii)  Forty per cent of the estimated tax shall be due on
    24  June 15, 2004.
    25     (iii)  Twenty per cent of the estimated tax shall be due on
    26  September 15, 2004.
    27     (2)  [For calendar [years after 2004] YEAR 2005, the payment   <--
    28  of the estimated tax under subsection (a)(3) shall be due in
    29  accordance with section 3003.2.] This subsection shall expire     <--
    30  January 1, WITH SECTION 3003.2.                                   <--
    20050H0338B2209                  - 4 -     

     1     (3)  THIS SUBSECTION SHALL EXPIRE JANUARY 1, 2007.
     2     * * *
     3     Section 2.  Section 33(12) of the act of December 23, 2003
     4  (P.L.250, No.46), entitled "An act Amending the act of March 4,
     5  1971 (P.L.6, No.2), entitled 'An act relating to tax reform and
     6  State taxation by codifying and enumerating certain subjects of
     7  taxation and imposing taxes thereon; providing procedures for
     8  the payment, collection, administration and enforcement thereof;
     9  providing for tax credits in certain cases; conferring powers
    10  and imposing duties upon the Department of Revenue, certain
    11  employers, fiduciaries, individuals, persons, corporations and
    12  other entities; prescribing crimes, offenses and penalties,'
    13  further providing, in sales and use tax, for definitions, for
    14  exclusions, for credits, for licenses and for transfers to
    15  Public Transportation Assistance Fund; further providing, in
    16  personal income tax, for definitions, for imposition, for
    17  special tax provisions for poverty, for returns and liability
    18  and for returns and records; further providing, in corporate net
    19  income tax, for definitions and for interests in unincorporated
    20  entities; providing, in corporate net income tax, for additional
    21  withholding requirements; further providing, in capital stock
    22  franchise tax, for definitions and reports, for imposition and
    23  for expiration; further providing, in utilities gross receipts
    24  tax, for imposition; further providing, in public utility realty
    25  tax, for surcharges; providing, in public utility realty tax,
    26  for additional tax; further providing, in cigarette tax, for
    27  incidence and rate of tax, for floor tax, for stamp to evidence
    28  the tax and for commissions on sales; establishing, in relation
    29  to cigarette tax, the Health Care Provider Retention Account;
    30  further providing, in research and development tax credit, for
    20050H0338B2209                  - 5 -     

     1  carryover, for limitations and for reports; further providing,
     2  in malt beverage tax, for limited tax credits; further
     3  providing, in inheritance tax, for definitions, for exempt
     4  transfers, for estate tax and for estate tax returns; further
     5  providing for the Public Transportation Assistance Fund and
     6  providing for its administration; further providing for
     7  estimated tax and for underpayment of estimated tax; providing
     8  for authority to attach wages; and repealing provisions relating
     9  to the Public Transportation Assistance Fund," is repealed.
    10     Section 3.  This act shall take effect immediately.














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