This information release is to provide notification to commercial activity tax (CAT) taxpayers of the recent legislative change in Am. Sub. H.B. 59 of the 130th General Assembly to the structure of the annual minimum tax (AMT). It is important to note that, in general, persons with $150,000 or less in taxable gross receipts are not subject to the CAT. Also note that the CAT rate of 0.26% remains unchanged and continues to apply to those taxpayer’s with taxable gross receipts over $1 million (the first $1 million in taxable gross receipts are excluded from the calculation of a taxpayer’s CAT liability with respect to the 0.26% rate component).Government double talk on display.
All CAT taxpayers pay an AMT which is due with calendar year taxpayers’ annual returns and with quarterly taxpayers’ first quarter returns, due on or before May 10th of each year. Currently, the AMT is $150. For tax periods beginning on January 1, 2014 and thereafter, the AMT will become a tiered structure, and taxpayers will pay an amount that corresponds with their overall commercial activity. The taxpayer will utilize its previous calendar year’s taxable gross receipts to determine the current year’s AMT. Those taxpayers with $1 million or less in taxable gross receipts will pay $150 AMT (no change). The AMT for taxpayers with total taxable gross receipts of more than $1 million but less than or equal to $2 million will be $800; AMT for taxpayers with taxable gross receipts more than $2 million but less than or equal to $4 million, $2,100; and AMT for taxpayers with taxable gross receipts in excess of $4 million, $2,600. Please refer to the chart below.
For this charge to be an 'annual minimum tax', it would have to counted as part of the CAT payment.
That is, if you owed only $100 this period, but the 'AMT' was $150, then you would have to pay $150.
And next period, you would get credit for the extra $50 paid the quarter before, because AMT would imply that you should never pay less than $150 in the year.
If this AMT is levied in addition to the percentage of gross receipts, then it is an annual minimum FEE, a fee the state is charging companies for the pleasure of doing business in the state.
And this extra fee? Passed by a Republican controlled legislature, approved by a Republican governor. Yea, they really are the opposite of the Democratic 'tax & spend' politicians, aren't they?