Sec. 12-219. Additional tax in the amount by which alternative computations exceed tax under section 12-214. Minimum tax. Surcharge.
Sec. 12-219. Additional tax in the amount by which alternative computations
exceed tax under section 12-214. Minimum tax. Surcharge. (a)(1) Each company
subject to the provisions of this part shall pay for the privilege of carrying on or doing
business within the state, the larger of the tax, if any, imposed by section 12-214 and
the tax calculated under this subsection. The tax calculated under this section shall be
a tax of three and one-tenth mills per dollar for each income year of the amount derived
(A) by adding (i) the average value of the issued and outstanding capital stock, including
treasury stock at par or face value, fractional shares, scrip certificates convertible into
shares of stock and amounts received on subscriptions to capital stock, computed on
the balances at the beginning and end of the taxable year or period, the average value
of surplus and undivided profit computed on the balances at the beginning and end of
the taxable year or period, and (ii) the average value of all surplus reserves computed
on the balances at the beginning and end of the taxable year or period, (B) by subtracting
from the sum so calculated (i) the average value of any deficit carried on the balance
sheet computed on the balances at the beginning and end of the taxable year or period,
and (ii) the average value of any holdings of stock of private corporations including
treasury stock shown on the balance sheet computed on the balances at the beginning
and end of the taxable year or period, and (C) by apportioning the remainder so derived
between this and other states under the provisions of section 12-219a, provided in no
event shall the tax so calculated exceed one million dollars or be less than two hundred
fifty dollars.
(2) For purposes of this subsection, in the case of a new domestic company, the
balances at the beginning of its first fiscal year or period shall be the balances immediately after its organization or immediately after it commences business operations,
whichever is earlier; and in the case of a foreign company, the balances at the beginning
of its first fiscal year or period in which it becomes liable for the filing of a return in
this state shall be the balances as established at the beginning of the fiscal year or period
for tax purposes. In the case of a domestic company dissolving or limiting its existence,
the balances at the end of the fiscal year or period shall be the balances immediately
prior to the final distribution of all its assets; and in the case of a foreign company filing
a certificate of withdrawal, the balances at the end of the fiscal year or period shall be
the balances immediately prior to the withdrawal of all of its assets. When a taxpayer
has carried on or had the right to carry on business within the state for eleven months
or less of the income year, the tax calculated under this subsection shall be reduced in
proportion to the fractional part of the year during which business was carried on by
such taxpayer. The tax calculated under this subsection shall, in no case, be less than
two hundred fifty dollars for each income year. The taxpayer shall report the items set
forth in this subsection at the amounts at which such items appear upon its books; provided, when, in the opinion of the Commissioner of Revenue Services, the books of the
taxpayer do not disclose a reasonable valuation of such items, the commissioner may
require any additional information which may be necessary for a reasonable determination of the tax calculated under this subsection and shall, on the basis of the best information available, calculate such tax and notify the taxpayer thereof.
(3) No tax credit allowed against the tax imposed by this chapter shall reduce a
company's tax calculated under this subsection to an amount less than two hundred fifty
dollars.
(b) (1) With respect to income years commencing on or after January 1, 1989, and
prior to January 1, 1992, the additional tax imposed on any company and calculated in
accordance with subsection (a) of this section shall, for each such income year, except
when the tax so calculated is equal to two hundred fifty dollars, be increased by adding
thereto an amount equal to twenty per cent of the additional tax so calculated for such
income year, without reduction of the additional tax so calculated by the amount of any
credit against such tax. The increased amount of tax payable by any company under
this section, as determined in accordance with this subsection, shall become due and be
paid, collected and enforced as provided in this chapter.
(2) With respect to income years commencing on or after January 1, 1992, and
prior to January 1, 1993, the additional tax imposed on any company and calculated in
accordance with subsection (a) of this section shall, for each such income year, except
when the tax so calculated is equal to two hundred fifty dollars, be increased by adding
thereto an amount equal to ten per cent of the additional tax so calculated for such income
year, without reduction of the tax so calculated by the amount of any credit against
such tax. The increased amount of tax payable by any company under this section, as
determined in accordance with this subsection, shall become due and be paid, collected
and enforced as provided in this chapter.
(3) With respect to income years commencing on or after January 1, 2003, and
prior to January 1, 2004, the additional tax imposed on any company and calculated in
accordance with subsection (a) of this section shall, for each such income year, be increased by adding thereto an amount equal to twenty per cent of the additional tax so
calculated for such income year, without reduction of the tax so calculated by the amount
of any credit against such tax. The increased amount of tax payable by any company
under this section, as determined in accordance with this subsection, shall become due
and be paid, collected and enforced as provided in this chapter.
(4) With respect to income years commencing on or after January 1, 2004, and
prior to January 1, 2005, the additional tax imposed on any company and calculated in
accordance with subsection (a) of this section shall, for each such income year, be increased by adding thereto an amount equal to twenty-five per cent of the additional tax
so calculated for such income year, without reduction of the tax so calculated by the
amount of any credit against such tax, except that any company that pays the minimum
tax of two hundred fifty dollars under this section or section 12-223c for such income
year shall not be subject to such additional tax. The increased amount of tax payable
by any company under this subdivision, as determined in accordance with this subsection, shall become due and be paid, collected and enforced as provided in this chapter.
(5) With respect to income years commencing on or after January 1, 2006, and
prior to January 1, 2007, the additional tax imposed on any company and calculated in
accordance with subsection (a) of this section shall, for each such income year, except
when the tax so calculated is equal to two hundred fifty dollars, be increased by adding
thereto an amount equal to twenty per cent of the additional tax so calculated for such
income year, without reduction of the tax so calculated by the amount of any credit
against such tax. The increased amount of tax payable by any company under this section,
as determined in accordance with this subsection, shall become due and be paid, collected and enforced as provided in this chapter.
(c) The tax imposed by this section shall be assessed and collected and be first
applicable at the time or times herein provided for the tax measured by net income. This
section shall not apply to insurance companies, real estate investment trusts, regulated
investment companies, interlocal risk management agencies formed pursuant to chapter
113a or, except as otherwise provided by subsection (d) of this section, financial service
companies, as defined in section 12-218b.
(d) Each financial service company, as defined in section 12-218b, shall pay for the
privilege of carrying on or doing business within the state, the larger of the tax, if any,
imposed by section 12-214 and the tax calculated under this subsection. For each such
financial service company, the tax calculated under this subsection shall be two hundred
fifty dollars for each income year. No tax credit allowed against the tax imposed by this
chapter shall reduce a financial service company's tax calculated under this subsection
to an amount less than two hundred fifty dollars.
(1949 Rev., S. 1900; 1951, 1953, June, 1955, S. 1096d; 1957, P.A. 560, S. 2; 649, S. 2; 1959, P.A. 394, S. 2; 1961,
P.A. 428, S. 3; 604, S. 3; 1963, P.A. 141; February, 1965, P.A. 461, S. 8; June, 1969, P.A. 1, S. 15; 1971, P.A. 683, S. 2;
June, 1971, P.A. 5, S. 112; 1972, P.A. 126, S. 1; 285, S. 7; P.A. 73-350, S. 11, 27; P.A. 75-213, S. 2, 53; P.A. 77-614, S.
139, 610; P.A. 78-121, S. 106, 113; P. A. 80-483, S. 56, 186; P.A. 81-66, S. 2, 5; 81-255, S. 22, 37; 81-411, S. 8, 42; Nov.
Sp. Sess. P.A. 81-4, S. 30, 32; P.A. 82-325, S. 3, 7; P.A. 84-546, S. 32, 33, 173; P.A. 85-159, S. 2, 19; 85-469, S. 4, 6;
P.A. 86-124, S. 1, 2; 86-132; 86-403, S. 131, 132; P.A. 89-16, S. 2, 31; 89-251, S. 21, 203; P.A. 90-174, S. 1, 3; June Sp.
Sess. P.A. 91-3, S. 101, 168; P.A. 93-74, S. 8, 59, 67; May Sp. Sess. P.A. 94-4, S. 7, 85; P.A. 95-160, S. 64, 69; P.A. 96-197, S. 6, 11; P.A. 98-110, S. 19, 27; May 9 Sp. Sess. P.A. 02-1, S. 57; P.A. 03-2, S. 34; June 30 Sp. Sess. P.A. 03-1, S.
88; P.A. 05-251, S. 63; P.A. 06-186, S. 67.)
History: 1959 act applied tax to each income year, added reference to deferred and unrealized profits in Subdiv. (B)(a)(3)
and to treasury stock in Subdiv. (B)(b)(2); 1961 acts raised alternative tax rate from 1.9 mills to 2.5 mills, added exception
to minimum tax for banking and financial corporations, and changed technical language; 1963 act added exception for
small business investment companies; 1965 act set deadline for 2.5 mill rate to years beginning before January 1, 1966,
and raised mill rate to two and five-eighths thereafter, set same deadline for $25 minimum tax, raised to $30 thereafter and
set same deadline for 2% tax re banking institutions, raised to 2.1% thereafter; 1969 act for two years, January 1, 1969, to
January 1, 1971, changed rates above to four mills, $45 and 3.2% respectively; 1971 acts divided section into subsecs. and
made basis for payments, the difference between tax imposed in Sec. 12-214 and tax calculated under Subdivs. (A) and
(B) and changed ending dates for temporary increases in rates from 1971 to 1973; 1972 acts included maximum tax for
income years beginning on or after January 1, 1972, for "any company, except companies subject to the gross earnings
taxes under chapters 211 and 212, which, in arriving at net income ... is entitled to a deduction under section 12-217 for
dividends as defined in the federal corporation income tax law" and made temporary increased tax rates the permanent
rates; P.A. 73-350 made provisions applicable to years beginning on or after January 1, 1973, increased mill rate from 4
to 4.25 mills and specifically excluded regulated investment companies and real estate investment trusts, deleted par or
face value of indebtedness and deferred and unrealized profits from calculation of taxable amount and set maximum and
minimum charges of $100,000 and $50, respectively, and changed provisions formerly applicable to companies, "except
companies subject to the gross earnings taxes under chapters 211 and 212" applicable to regulated investment companies
or real estate investment trusts, set forth process for deriving amount subject to tax and established $50 minimum tax for
such companies, increased figures in Subsec. (2)(B) from $45 to $50, changed rate for computation of interest and dividends
from 2% to one-eighth of 1% and excluded insurance companies from provisions of section; P.A. 75-213 changed mill
rate for companies other than regulated investment companies and real estate investment trusts from 0.25 mill to 0.31 mill
and for regulated investment companies and real estate investment trusts from 0.4 to 0.5 mill, effective July 1, 1975, and
applicable to income years commencing on or after January 1, 1975; P.A. 77-614 substituted commissioner of revenue
services for tax commissioner, effective January 1, 1979; P.A. 78-121 deleted reference to private banks in Subsec. (1)(A);
P.A. 80-483 deleted reference to building and loan associations in Subsec. (1)(A) and (2)(B); P.A. 81-66 raised mill rate
in (1)(A) from 0.31 mill to 3.1 mills per dollar and increased minimum tax from $50 to $100, effective May 4, 1981, and
applicable to income years commencing on or after January 1, 1981; P.A. 81-255 added the alternative computation of tax
under Subdiv. (B) and increased the minimum tax to $250, effective July 1, 1981, and applicable to income years commencing on or after January 1, 1981; P.A. 81-411 added consideration of a loss for the income year in the alternative tax base
under Subdiv. (B), and deleted provisions allowing deductions for contributions to retirement plan in determining salaries
and other compensation, effective June 18, 1981, and applicable to income years commencing on or after January 1, 1981;
Nov. Sp. Sess. P.A. 81-4 deleted Subsec. (1)(B) re alternative tax (if higher than that in Subdiv. (a)) consisting of 50% of
corporation's net income or loss plus salaries and other compensation paid to elected or appointed corporation officers or
to shareholders owning more than 1% of stock at rate of 5%, amending section accordingly, effective January 27, 1982,
and applicable to income years commencing on or after January 1, 1983; P.A. 82-325 changed effective date of Nov. Sp.
Sess. P.A. 81-4, but without affecting this section; P.A. 84-546 made technical change, substituting "scrip" for "script" in
Subsec. (1); P.A. 85-159 reduced minimum tax to $100 for income years of corporations commencing on or after January
1, 1985; P.A. 85-469 revised effective date of P.A. 85-159 but without affecting this section; P.A. 86-124 revised section
to conform to the style of the general statutes and amended Subsec. (a)(1)(C) to increase the maximum tax from $100,000
to $500,000, effective May 8, 1986, and applicable to income years of corporations commencing on or after January 1,
1986; P.A. 86-132 deleted provision limiting the types of regulated investment companies or real estate investment trusts
to which the provisions concerning those types of companies and trusts applied; P.A. 86-403 changed effective date of
P.A. 86-132 from October 1, 1986, to May 23, 1986 and applicable to income years of corporations commencing on or
after January 1, 1986; P.A. 89-16 increased the minimum tax from $100 to $250 in Subsecs. (a) and (b), and amended
Subsec. (c) to impose an additional tax as a percentage of the tax calculated under Subsec. (a) or Subsec. (b), effective
March 23, 1989, and applicable to income years of corporations commencing on or after January 1, 1989; P.A. 89-251
increased the tax imposed under Subsec. (c), as amended by P.A. 89-16, as a percentage of the additional tax calculated
under Subsec. (a) or Subsec. (b) from 15% to 20% of the additional tax, effective July 1, 1989, and applicable to income
years commencing on or after January 1, 1989; P.A. 90-174 amended Subsec. (a)(2) to provide for a maximum tax under
said subdivision of $50,000, effective July 1, 1990, and applicable to income years of corporations commencing on or
after January 1, 1991; June Sp. Sess. P.A. 91-3 amended Subsec. (a)(1)(C) to increase the maximum tax from $500,000
to $1,000,000 and Subsec. (c) to provide that the 20% additional tax would be applicable with respect to income years
commencing prior to January 1, 1992, and to impose a 10% additional tax applicable with respect to income years commencing on or after January 1, 1992, and prior to January 1, 1993, effective August 22, 1991, and applicable to income years
of corporations commencing on or after January 1, 1991; P.A. 93-74 deleted Subsec. (a)(2) with respect to regulated
investment company or real estate investment trusts, renumbering Subdiv. (3) accordingly and amended Subsec. (d) to
exclude real estate investment trusts and regulated investment trusts from provisions of section, effective May 19, 1993,
and applicable to taxable years commencing on and after January 1, 1993; May Sp. Sess. P.A. 94-4 in Subsec. (d) exempted
interlocal risk management agencies formed pursuant to chapter 113a, effective June 9, 1994, and applicable to income
years commencing on or after January 1, 1980; P.A. 95-160 revised effective date of May Sp. Sess. P.A. 94-4 but without
affecting this section; P.A. 96-197 amended Subsecs. (a) and (b) to clarify that out-of-state businesses carrying on or doing
business in the state are subject to the tax on the capital base and made technical changes, effective June 3, 1996, and
applicable to income years commencing on or after January 1, 1996; P.A. 98-110 deleted Subsec. (b) re certain banks,
trusts, investment and financing entities, relettered existing Subsecs., excluded financial service companies and made
technical changes, effective May 19, 1998, and applicable to income years commencing on or after January 1, 1999; May
9 Sp. Sess. P.A. 02-1 added Subsec. (a)(3) re the effect of tax credits on the minimum tax, amended Subsec. (c) by adding
"except as otherwise provided by subsection (d) of this section" and added Subsec. (d) re a minimum tax for financial
services companies, effective July 1, 2002, and applicable to income years commencing on or after January 1, 2002; P.A.
03-2 added Subsec. (b)(3) re a surcharge for the 2003 income year, effective February 28, 2003, and applicable to income
years commencing on or after January 1, 2003; June 30 Sp. Sess. P.A. 03-1 amended Subsec. (b) to include in surcharge
provided under Subdiv. (3) amounts calculated under Sec. 91 of P.A. 03-1 of the June 30 special session and to add Subdiv.
(4) re surcharge for the 2004 income year, effective August 16, 2003, and applicable to income years commencing on or
after January 1, 2003; P.A. 05-251 amended Subsec. (b) by deleting references to Sec. 91 of June 30 Sp. Sess. 03-1 in
Subdivs. (3) and (4) and by adding Subdivs. (5) and (7) re surcharge in income years 2006 and 2007, respectively, effective
June 30, 2005, and applicable to income years commencing on or after January 1, 2006; P.A. 06-186 amended Subsec.
(b) to eliminate former Subdiv. (6) re surcharge in income year commencing on or after January 1, 2007, and prior to
January 1, 2008, effective July 1, 2006, and applicable to income years commencing on or after January 1, 2006.
Under former statute, indebtedness did not include indebtedness on which company not personally liable. 122 C. 143.
Cited. Id., 550. Cited. 135 C. 57. Cited. 178 C. 240. Cited. 195 C. 284. Cited. 203 C. 198. Cited. 220 C. 665.
Cited. 2 CA 660.
Cited 40 CS 77.