(a) Any manufacturing, retailing, wholesaling or service business taxable under Sections 729.06, 729.07 or 729.12 located in the City at the time of passage of this section shall be eligible for a fifty percent (50%) tax credit against the increase of the tax liability derived from an expansion, as defined below. However, the credit shall only apply to that incremental portion of gross income which is greater than the average gross income generated by the business over the previous three years and shall be applicable in the taxing category in which the business has paid fifty percent (50%) or greater or its Business and Occupation Taxes to the City in the twelve month period immediately preceding application for the credit.
(b) “Expansion” means the purchase of certain property, as herein defined for the purpose of increasing the economic productivity of the business.
(c) “Property” means real property, and improvements thereto, and new, tangible personal property, but only if such property was constructed, or purchased, on or after the passage of this section for use as a component part of an ongoing business operation located within the City. This term includes only tangible personal property with respect to which depreciation is allowable in determining the personal income tax or corporate net income tax liability of the business taxpayer, and has a useful life at the time the property is placed in service or use in this City of four years or more. Property acquired by written lease for a primary term of five years or longer, if used as a component part of an expansion, shall be included within this definition.
“Property”, within the meaning of this section, shall not include:
(1) Repair costs, including materials used in the repair, unless for federal income tax purposes the cost of the repair shall be capitalized and not expended;
(2) Motor vehicles licensed by the Department of Motor Vehicles;
(3) Airplanes;
(4) Off premise transportation equipment;
(5) Property which is acquired incident to the purchase of the stock or assets of an industrial taxpayer, which property was or had been used by the seller in his industrial business in the City, or which property was previously designated “property purchased for industrial expansion” or “property purchased for industrial revitalization”, or “property purchased for eligible research and development project”; provided, however, the City Treasurer may waive this disqualification.
(d) Property shall be deemed to have been purchased prior to a specified date only when:
(1) The physical construction, reconstruction or erection of the property was begun prior to the specified date, or such property was constructed, reconstructed, erected or acquired pursuant to a written contract as existing and binding on the purchase prior to the specified date;
(2) The machinery or equipment was owned by the taxpayer prior to the specified date or was acquired by the taxpayer pursuant to a binding purchase contract which was in effect prior to such date; or
(3) In the case of leased property, there was a binding written lease or contract to lease identifiable property in effect prior to the specified date.
(e) Any tax credit made available by this section shall be applied for in the tax quarter in which the qualifying property was purchased, and may be available for a period of two consecutive years from the date of first application.
(f) Any retailing, wholesaling, or service business taxable under Sections 729.07 or 729.12, located in the City at the time of the passage of this section, shall be eligible for a fifty percent (50%) tax credit against the increase of the tax liability derived from an increase in gross sales as herein described.
In order for a business’ increase in gross sales to qualify for this credit, the increase must be ten percent (10%) greater than the previous years’ gross sales, or the average of the previous three years’ gross sales, whichever is greater. The credit shall only apply to that incremental increase in gross sales above the ten percent (10%) increase mentioned herein.
The tax credit may be available for a period of two consecutive years from the date of first application. (Ord. 552. Passed 8-7-95.)