(A) This section does not apply to taxpayers that are subject to and required to file reports under R.C. Chapter 5745. Except as otherwise provided in this section, net profit from a business or profession conducted both within and without the boundaries of a municipal corporation shall be considered as having a taxable situs in such municipal corporation for purposes of municipal income taxation in the same proportion as the average ratio of the following.
(B) Multiply the entire net profits of the business by a business allocation apportionment percentage formula to be determined by:
(1) (a) The average original cost of the real and tangible personal property owned or used by the taxpayer in the business or profession in such municipal corporation during the taxable period to the average original cost of all of the real and tangible personal property owned or used by the taxpayer in the business or profession during the same period, wherever situated.
(b) As used in the preceding division (a), REAL PROPERTY shall include property rented or leased by the taxpayer and the value of such property shall be determined by multiplying the annual rental thereon by eight.
(2) Wages, salaries, and other compensation paid during the taxable period to persons employed in the business or profession for services performed in such municipal corporation to wages, salaries, and other compensation paid during the same period to persons employed in the business or profession, wherever their services are performed, excluding compensation that is not taxable by the municipal corporation under R.C. § 718.011.
(3) Gross receipts of the business or profession from sales made and services performed during the taxable period in such municipal corporation to gross receipts of the business or profession during the same period from sales and services, wherever made or performed.
(4) Adding together the percentages determined in accordance with divisions (B)(1), (2), and (3) hereof, or such of the aforesaid percentages as are applicable to the particular taxpayer, and dividing the total so obtained by the number of percentages used in deriving said total.
(C) A factor is applicable even though it may be apportioned entirely in or outside the municipality.
(D) Provided, however, that in the event a just and equitable result cannot be obtained under the business apportionment percentage formula provided for herein, the Finance Director, upon application of the taxpayer, shall have the authority to substitute other factors or methods calculated to effect a fair and proper apportionment.
(E) As used in this section, SALES MADE IN A MUNICIPAL CORPORATION means:
(1) All sales of tangible personal property delivered within such municipal corporation regardless of where title passes if shipped or delivered from a stock of goods within such municipal corporation;
(2) All sales of tangible personal property delivered within such municipal corporation regardless of where title passes even though transported from a point outside such municipal corporation if the taxpayer is regularly engaged through its own employees in the solicitation or promotion of sales within such municipal corporation and the sales result from such solicitation or promotion; and
(3) All sales of tangible personal property shipped from a place within such municipal corporation to purchasers outside such municipal corporation regardless of where title passes if the taxpayer is not, through its own employees, regularly engaged in the solicitation or promotion of sales at the place where delivery is made.
(F) Except as otherwise provided in this section, net profit from rental activity not constituting a business or profession shall be subject to tax only by the municipal corporation in which the property generating the net profit is located.
(G) This section does not apply to individuals who are residents of the municipality and, except as otherwise provided in R.C. § 718.01, the municipality may impose a tax on all income earned by residents of the municipality to the extent allowed by the United States Constitution.
(‘74 Code, § 93.06) (Ord. 384-A, passed 4-1-71; Am. Ord. 01-1348, passed 1-16-01; Am. Ord. 05-1469, passed 12-21-05)
Statutory reference:
Similar provisions, see R.C. § 718.02