880.03  IMPOSITION OF TAX.
   (a)   Applicability of Tax.  Subject to the provisions of Section 880.15, an annual tax for the purposes specified in Section 880.01 shall be imposed on and after January 1, 2005, at the rate of two percent upon the following:
      (1)   On all salaries, wages, commissions and other compensation earned during the effective period of this chapter by residents of the Municipality;
      (2)   On all salaries, wages, commissions and other compensation earned during the effective period of this chapter by nonresidents for work done or services performed or rendered in the Municipality;
      (3)   On the portion attributable to the Municipality of the net profits earned during the effective period of this chapter of all resident unincorporated businesses, professions  or other entities, derived from sales made, work done, services performed or rendered and business or other activities conducted in the Municipality;
      (4)   On the portion of the distributive share of the net profits earned during the effective period of this chapter of a resident partner or owner of a resident unincorporated business entity not attributable to the Municipality and not levied against such unincorporated business entity by the Municipality;
      (5)   On the portion attributable to the Municipality of the net profits earned during the effective period of this chapter of all nonresident unincorporated businesses, professions or other entities, derived from sales made, work done or services performed or rendered and business or other activities conducted in the Municipality, whether or not such unincorporated business entity has an office or place of business in the Municipality;
      (6)   On the portion of the distributive share of the net profits earned during the effective period of this chapter of a resident partner or owner of a nonresident unincorporated business entity not attributable to the Municipality and not levied against such unincorporated business entity by the Municipality;
      (7)   On the portion attributable to the Municipality of the net profits earned during the effective period of this chapter of all corporations derived from sales made, work done, services performed or rendered and business or other activities conducted in the Municipality, whether or not such corporations have an office or place of business in the Municipality.
      (8)   On all proceeds from lotteries, gaming, wagering or schemes of chance, including, but not limited to the Ohio State Lottery, received by residents of the Municipality or received by nonresidents of the Municipality within the City of Norton or on the basis of activity conducted within the City.
(Ord. 77-1984. Passed 11-12-84; Ord. 20-2004. Passed 3-8-04; Ord. 61-2004. Passed 5-24-04.)
   (b)   Determination of Taxable Income. The portion of the net profits attributable to the Municipality of a taxpayer conducting a business, profession or other activity within and without the boundaries of the Municipality shall be determined as provided in Ohio R.C. 718.02 and in accordance with the rules and regulations adopted by the Administrator pursuant to this chapter.
   (c)   Operating Loss Carry-Forward.
      (1)   The portion of a net operating loss sustained in any taxable year subsequent to January 1, 1973, allocable to the Municipality may be applied against the portion of the profit of succeeding years allocable to the Municipality, until exhausted, but in no event for more than five taxable years. No portion of a net operating loss shall be carried back against net profits of any prior year.
      (2)   The portion of a net operating loss sustained shall be allocated to the Municipality in the same manner as provided herein for allocating net profits to the Municipality.
      (3)   The Administrator shall provide by rules and regulations the manner in which such net operating loss carry-forward shall be determined.
   (d)   Consolidated Returns.
      (1)   Filing of consolidated returns may be permitted, required or denied in accordance with rules and regulations prescribed by the Administrator.
      (2)   In the case of a corporation that carried on transactions with its stockholders or with other corporations related by stock ownership, interlocking directorates or some other method, or in the case a person who operates a division, branch, factory, office, laboratory or activity within the Municipality constituting a portion only of its total business, the Administrator shall require such additional information as he or she deems necessary to ascertain whether net profits are properly allocated to the Municipality.  If the Administrator finds that net profits are not properly allocated to the Municipality by reason of transactions with stockholders or with other corporations related by stock ownership, interlocking directorates or transactions with such division, branch, factory, office, laboratory or activity, or by some other method, he or she shall make such allocation as he or she deems appropriate to produce a fair and proper allocation of net profits to the Municipality.
   (e)   Exception. The tax provided for herein shall not be levied upon any of the following:
      (1)   Pay or allowance of active members of the Armed Forces of the United States, or the income of religious, fraternal, charitable, scientific, literary or educational institutions to the extent that such income is derived from tax exempt real estate, tax exempt tangible or intangible property or tax exempt activities;
      (2)   Poor relief, unemployment insurance benefits, old age pensions or similar payments, including disability benefits received from local, State or Federal government or charitable, religious or educational organizations;
      (3)   Proceeds of insurance paid by reason of the death of the insured, pensions, disability benefits, annuities or gratuities not in the nature of compensation for services rendered from whatever source derived;
      (4)   Receipts from seasonal or casual entertainment, amusements, sports events and health and welfare activities when any of such is conducted by bona fide charitable, religious or educational organizations and associations;
      (5)   Earnings and income of any person under eighteen years of age, whether residents or nonresidents;
      (6)   Gains from involuntary conversion, cancellation of indebtedness, interest on Federal obligations, items of income already taxed by the State from which the City is specifically prohibited from taxing and income of a decedent's estate during the period of administration (except such income from the operation of a business);
      (7)   Salaries, wages, commissions and other compensation and net profits, the taxation of which is prohibited by the United States Constitution or any act of Congress limiting the power of the states or their political subdivisions to impose net income taxes on income derived from interstate commerce; and
      (8)   Salaries, wages, commissions and other compensation and net profits, the taxation of which is prohibited by the Constitution of the State or any act of the Ohio General Assembly limiting the power of the City to impose net income taxes.
(Ord. 29-1973. Passed 2-12-73.)