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Missouri House Bill HB133

Missouri 2023 Regular Session

Missouri House Bill HB133 Compare Versions

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22 EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
33 and is intended to be omitted in the law.
44 FIRST REGULAR SESSION
55 SENATE COMMITTEE SUBSTITUTE FOR
66 HOUSE COMMITTEE SUBSTITUTE FOR
77 HOUSE BILLS NOS. 133 & 583
88 102ND GENERAL ASSEMBLY
99 0599S.04C KRISTINA MARTIN, Secretary
1010 AN ACT
1111 To repeal section 135.750, RSMo, and to enact in lieu thereof two new sections relating to tax
1212 credits for the production of certain entertainment, with an effective date for a certain
1313 section.
1414
1515 Be it enacted by the General Assembly of the State of Missouri, as follows:
1616 Section A. Section 135.750, RS Mo, is repealed and two new 1
1717 sections enacted in lieu thereof, to be known as sections 2
1818 135.750 and 135.753, to read as follows:3
1919 135.750. 1. This section shall be known and may be 1
2020 referred to as the "Show MO Act". 2
2121 2. As used in this section, t he following terms mean: 3
2222 (1) ["Highly compensated individual", any individual 4
2323 who receives compensation in excess of one million dollars 5
2424 in connection with a single qualified film production 6
2525 project] "Above-the-line individual", any individual hir ed 7
2626 or credited on screen for a qualified motion media 8
2727 production project as any type of producer, principal cast 9
2828 that is at a screen actors guild schedule f and above 10
2929 payment rate, screenwriter, and the director ; 11
3030 (2) "Qualified [film] motion media production 12
3131 project", any film[, video, commercial, or television 13
3232 production] or series production, including videos, 14
3333 commercials, video games, webisodes, music videos, content - 15 SCS HCS HBs 133 & 583 2
3434 based mobile applications, virtual reality, augmented 16
3535 reality, multi-media, and new media, as well as standalone 17
3636 visual effects and post -production for such motion media 18
3737 production project, as approved by the department of 19
3838 economic development and the office of the Missouri film 20
3939 commission, that features a statement and log o designated by 21
4040 the department of economic development in the credits of the 22
4141 completed production indicating that the project was filmed 23
4242 in Missouri and that is under thirty minutes in length with 24
4343 [an] expected [in-state expenditure budget ] qualifying 25
4444 expenses in excess of fifty thousand dollars [,] or [that] is 26
4545 over thirty minutes in length with [an] expected [in-state 27
4646 expenditure budget] qualifying expenses in excess of one 28
4747 hundred thousand dollars. Regardless of the production 29
4848 costs, "qualified [film production] motion media project" 30
4949 shall not include any: 31
5050 (a) News or current events programming; 32
5151 (b) Talk show; 33
5252 (c) Production produced primarily for industrial, 34
5353 corporate, or institutional purposes, and for internal use; 35
5454 (d) Sports event or sports program; 36
5555 (e) Gala presentation or awards show; 37
5656 (f) Infomercial or any production that directly 38
5757 solicits funds; 39
5858 (g) Political ad; 40
5959 (h) Production that is considered obscene, as defined 41
6060 in section 573.010; 42
6161 (3) "Qualifying expenses", the sum of the total amount 43
6262 spent in this state for the following by a production 44
6363 company in connection with a qualified [film] motion media 45
6464 production project: 46 SCS HCS HBs 133 & 583 3
6565 (a) Goods and services leased or purchased by the 47
6666 production company. For goods with a purchase price of 48
6767 twenty-five thousand dollars or more, the amount included in 49
6868 qualifying expenses shall be the purchase price less the 50
6969 fair market value of the goods at the time the production is 51
7070 completed; 52
7171 (b) Compensation and wages paid by the production 53
7272 company on which the production company remitted withholding 54
7373 payments to the department of revenue under chapter 143. 55
7474 For purposes of this section, compensation and wages [shall 56
7575 not include any amounts paid to a highly compensated 57
7676 individual] paid to all above-the-line individuals shall be 58
7777 limited to twenty-five percent of the overall qualifying 59
7878 expenses; 60
7979 (4) "Tax credit", a credit against the tax otherwise 61
8080 due under chapter 143, excluding withhold ing tax imposed by 62
8181 sections 143.191 to 143.265, or otherwise due under chapter 63
8282 148; 64
8383 (5) "Taxpayer", any individual, partnership, or 65
8484 corporation as described in section 143.441, 143.471, or 66
8585 section 148.370 that is subject to the tax imposed in 67
8686 chapter 143, excluding withholding tax imposed by sections 68
8787 143.191 to 143.265, or the tax imposed in chapter 148 or any 69
8888 charitable organization which is exempt from federal income 70
8989 tax and whose Missouri unrelated business taxable income, if 71
9090 any, would be subject to the state income tax imposed under 72
9191 chapter 143. 73
9292 [2. For all taxable years beginning on or after 74
9393 January 1, 1999, but ending on or before December 31, 2007, 75
9494 a taxpayer shall be granted a tax credit for up to fifty 76
9595 percent of the amount of investment in production or 77
9696 production-related activities in any film production project 78 SCS HCS HBs 133 & 583 4
9797 with an expected in-state expenditure budget in excess of 79
9898 three hundred thousand dollars. For all taxable years 80
9999 beginning on or after January 1, 2008, a taxpa yer shall be 81
100100 allowed a tax credit for up to thirty -five percent of the 82
101101 amount of qualifying expenses in a qualified film production 83
102102 project. Each film production company shall be limited to 84
103103 one qualified film production project per year. ] 85
104104 3. (1) For all tax years beginning on or after 86
105105 January 1, 2023, a taxpayer shall be allowed a tax credit 87
106106 equal to twenty percent of qualifying expenses. 88
107107 (2) An additional five percent may be earned for 89
108108 qualifying expenses if at least fifty percent of the 90
109109 qualified motion media production project is filmed in 91
110110 Missouri. 92
111111 (3) An additional five percent may be earned for 93
112112 qualifying expenses if at least fifteen percent of the 94
113113 qualified motion media production project that is filmed in 95
114114 Missouri takes place in a rural or blighted area in Missouri. 96
115115 (4) An additional five percent may be earned for 97
116116 qualifying expenses if at least three departments of the 98
117117 qualified motion media production hire a Missouri resident 99
118118 ready to advance to the next lev el in a specialized craft 100
119119 position or learn a new skillset. 101
120120 (5) An additional five percent may be earned for 102
121121 qualifying expenses if the department of economic 103
122122 development determines that the script of the qualified 104
123123 motion media production project positively markets a city or 105
124124 region of the state, the entire state, or a tourist 106
125125 attraction located in the state, and the qualified motion 107
126126 media production provides no less than five high resolution 108
127127 photographs containing cast with the rights cleared for 109
128128 promotional use by the Missouri film commission, accompanied 110 SCS HCS HBs 133 & 583 5
129129 by a list with the title of production, location, names, and 111
130130 titles of the individuals shown in the photography and 112
131131 photographer credit. 113
132132 (6) The total dollar amount of tax credits a uthorized 114
133133 pursuant to subdivision (1) of this subsection shall be 115
134134 increased by ten percent for qualified film production 116
135135 projects located in a county of the second, third, or fourth 117
136136 class. 118
137137 (7) Activities qualifying a taxpayer for the tax 119
138138 credit pursuant to this subsection shall be approved by the 120
139139 office of the Missouri film commission and the department of 121
140140 economic development. 122
141141 4. A qualified motion media production project shall 123
142142 not be eligible for tax credits pursuant to this section 124
143143 unless such project employs at least the following number of 125
144144 Missouri registered apprentices or veterans residing in 126
145145 Missouri with transferable skills: 127
146146 (1) If the qualifying expenses are less than five 128
147147 million dollars, two; 129
148148 (2) If the qualifying expenses are at least five 130
149149 million dollars but less than ten million dollars, three; 131
150150 (3) If the qualifying expenses are at least ten 132
151151 million dollars but less than fifteen million dollars, six; 133
152152 or 134
153153 (4) If the qualifying expenses are at le ast fifteen 135
154154 million dollars, eight. 136
155155 [3.] 5. Taxpayers shall apply for the [film] motion 137
156156 media production tax credit by submitting an application to 138
157157 the department of economic development, on a form provided 139
158158 by the department. As part of the application, the expected 140
159159 [in-state expenditures] qualifying expenses of the qualified 141
160160 [film] motion media production project shall be documented. 142 SCS HCS HBs 133 & 583 6
161161 In addition, the application shall include an economic 143
162162 impact statement, showing the economic impact from th e 144
163163 activities of the [film] qualified motion media production 145
164164 project. Such economic impact statement shall indicate the 146
165165 impact on the region of the state in which the [film] 147
166166 qualified motion media production or production -related 148
167167 activities are locat ed and on the state as a whole. Final 149
168168 applications shall be accompanied by a report by a certified 150
169169 public accountant licensed by the state of Missouri, 151
170170 prepared at the expense of the applicant, attesting that the 152
171171 amounts in the final application are q ualifying expenses. 153
172172 [4. For all taxable years ending on or before December 154
173173 31, 2007, tax credits certified pursuant to subsection 2 of 155
174174 this section shall not exceed one million dollars per 156
175175 taxpayer per year, and shall not exceed a total for all tax 157
176176 credits certified of one million five hundred thousand 158
177177 dollars per year.] 159
178178 6. For all [taxable] tax years beginning on or after 160
179179 January 1, [2008] 2023, the total amount of tax credits 161
180180 [certified under subsection 1 of ] authorized by this section 162
181181 for film production shall not exceed a total [for all tax 163
182182 credits certified] of [four] eight million [five hundred 164
183183 thousand] dollars per year, and the total amount of all tax 165
184184 credits authorized by this section for series production 166
185185 shall not exceed a total of eight million dollars per year . 167
186186 Taxpayers may carry forward unused credits for up to five 168
187187 tax periods, provided all such credits shall be claimed 169
188188 within ten tax periods following the tax period in which the 170
189189 [film] qualified motion media production or production - 171
190190 related activities for which the credits are certified by 172
191191 the department occurred. 173 SCS HCS HBs 133 & 583 7
192192 [5.] 7. Notwithstanding any provision of law to the 174
193193 contrary, any taxpayer may sell, assign, exchange, convey or 175
194194 otherwise transfer tax credit s allowed in subsection [2] 3 176
195195 of this section. The taxpayer acquiring the tax credits may 177
196196 use the acquired credits to offset the tax liabilities 178
197197 otherwise imposed by chapter 143, excluding withholding tax 179
198198 imposed by sections 143.191 to 143.265, or cha pter 148. 180
199199 Unused acquired credits may be carried forward for up to 181
200200 five tax periods, provided all such credits shall be claimed 182
201201 within ten tax periods following the tax period in which the 183
202202 [film] qualified motion media production or production - 184
203203 related activities for which the credits are certified by 185
204204 the department occurred. 186
205205 8. The tax credit authorized by this section shall be 187
206206 considered a business recruitment tax credit, as defined in 188
207207 section 135.800, and shall be subject to the provisions o f 189
208208 sections 135.800 to 135.830. 190
209209 9. The department of economic development may adopt 191
210210 such rules, statements of policy, procedures, forms, and 192
211211 guidelines as may be necessary to implement the provisions 193
212212 of this section. Any rule or portion of a rule , as that 194
213213 term is defined in section 536.010, that is created under 195
214214 the authority delegated in this section shall become 196
215215 effective only if it complies with and is subject to all of 197
216216 the provisions of chapter 536 and, if applicable, section 198
217217 536.028. This section and chapter 536 are nonseverable and 199
218218 if any of the powers vested with the general assembly 200
219219 pursuant to chapter 536 to review, to delay the effective 201
220220 date, or to disapprove and annul a rule are subsequently 202
221221 held unconstitutional, then the gra nt of rulemaking 203
222222 authority and any rule proposed or adopted after August 28, 204
223223 2023, shall be invalid and void. 205 SCS HCS HBs 133 & 583 8
224224 [6.] 10. Under section 23.253 of the Missouri sunset 206
225225 act: 207
226226 (1) The provisions of the [new] program authorized 208
227227 under this section sh all automatically sunset [six years 209
228228 after November 28, 2007 ] on December 31, 2029 , unless 210
229229 reauthorized by an act of the general assembly; and 211
230230 (2) If such program is reauthorized, the program 212
231231 authorized under this section shall automatically sunset on 213
232232 December thirty-first, twelve years after the effective date 214
233233 of the reauthorization of this section; and 215
234234 (3) This section shall terminate on September first of 216
235235 the calendar year immediately following the calendar year in 217
236236 which the program aut horized under this section is sunset ; 218
237237 and 219
238238 (4) The provisions of this subsection shall not be 220
239239 construed to limit or in any way impair the department's 221
240240 ability to redeem tax credits authorized on or before the 222
241241 date the program authorized pursuant t o this section 223
242242 expires, or a taxpayer's ability to redeem such tax credits . 224
243243 11. (1) Notwithstanding the provisions of subsection 225
244244 10 of this section to the contrary, the provisions of this 226
245245 section shall automatically terminate and expire one year 227
246246 after the department of economic development determines that 228
247247 all other state and local governments in the United States 229
248248 of America have terminated or let lapse their tax credit or 230
249249 other governmental incentive program for the film production 231
250250 industry, regardless of whether such credits or programs are 232
251251 now in effect or first commence after the effective date of 233
252252 this section. The department of economic development shall 234
253253 notify the revisor of statutes upon the department's 235
254254 determination that the tax c redit authorized by this section 236
255255 shall terminate pursuant to this subsection. 237 SCS HCS HBs 133 & 583 9
256256 (2) The provisions of this subsection shall not be 238
257257 construed to limit or in any way impair the ability of any 239
258258 taxpayer that has met the requirements in this section prio r 240
259259 to the termination of this section to participate in the 241
260260 program authorized under this section. The provisions of 242
261261 this section shall not be construed to limit or in any way 243
262262 impair the department of revenue's ability to redeem tax 244
263263 credits qualified for on or before the date the program 245
264264 authorized pursuant to this section expires. 246
265265 135.753. 1. This section shall be known and may be 1
266266 cited as the "Entertainment Industry Jobs Act". 2
267267 2. As used in this section, the following ter ms shall 3
268268 mean: 4
269269 (1) "Base investment", the aggregate funds actually 5
270270 invested and expended by a Missouri taxpayer as a rehearsal 6
271271 expense or tour expense pursuant to this section; 7
272272 (2) "Concert", a ticketed live performance of music in 8
273273 the physical presence of at least one thousand individuals 9
274274 who view the performance live. For the purposes of this 10
275275 subdivision, "ticketed" shall mean a concert where 11
276276 individual tickets for attendance are offered for sale to 12
277277 the public; 13
278278 (3) "Concert tour equipment", stage, set, scenery, 14
279279 design elements, automation, rigging, trusses, spotlights, 15
280280 lighting, sound equipment, video equipment, special effects, 16
281281 cases, communication devices, power distribution equipment, 17
282282 backline and other miscellaneous equip ment, or supplies used 18
283283 during a concert or rehearsal; 19
284284 (4) "Department", the Missouri department of economic 20
285285 development; 21
286286 (5) "Expense", any expense, expenditure, cost, charge, 22
287287 or other disbursement or spending of funds; 23 SCS HCS HBs 133 & 583 10
288288 (6) "Facility", a site with one or more studios. 24
289289 Multiple studios at a single location shall not be 25
290290 considered separate facilities. A site may include one or 26
291291 more buildings on the same property or properties within a 27
292292 five-mile radius, provided that the properties' purpose and 28
293293 operations are interrelated and are owned or operated by the 29
294294 same owner or operator, as applicable; 30
295295 (7) "Facility full-time equivalent employee", an 31
296296 employee that is scheduled to work an average of at least 32
297297 thirty-five hours per week and is located at the qualified 33
298298 rehearsal facility, or a combination of two or more 34
299299 employees that combined, work an average of at least thirty - 35
300300 five hours per week and are located at the qualified 36
301301 rehearsal facility. An employee shall be considered to be 37
302302 located at the qualified rehearsal facility if such employee 38
303303 spends fifty percent or more of the employee's work time at 39
304304 the qualified rehearsal facility or at a nearby location 40
305305 serving the qualified rehearsal facility, including a 41
306306 warehouse, located in Missouri and owned by the same owner 42
307307 or operator, as applicable, of the qualified rehearsal 43
308308 facility. An employee that spends less than fifty percent 44
309309 of the employee's work time at the qualified rehearsal 45
310310 facility or nearby location shall be co nsidered to be 46
311311 located at a qualified rehearsal facility if the employee 47
312312 receives his or her directions and control from the 48
313313 qualified rehearsal facility and is on the qualified 49
314314 rehearsal facility's payroll; 50
315315 (8) "Minimum rehearsal and tour requir ements", the 51
316316 occurrence of all of the following during a rehearsal or 52
317317 tour: 53
318318 (a) The purchase or rental of concert tour equipment, 54
319319 related services, or both, in an amount of at least one 55 SCS HCS HBs 133 & 583 11
320320 million dollars from a Missouri vendor for use in the 56
321321 rehearsal, on the tour, or both; 57
322322 (b) A rehearsal at a qualified rehearsal facility for 58
323323 a minimum of ten days; and 59
324324 (c) The holding of at least two concerts in the state 60
325325 of Missouri; 61
326326 (9) "Missouri vendor", an individual or entity located 62
327327 in and maintaining a place of business in this state. Only 63
328328 transactions made through a Missouri location of a Missouri 64
329329 vendor shall constitute a transaction with a Missouri vendor 65
330330 for the purposes of this section; 66
331331 (10) "Nonresident", the same meaning as defined 67
332332 pursuant to section 143.101; 68
333333 (11) "Pass-through entity", any incorporated or 69
334334 unincorporated entity that has or elects pass -through 70
335335 taxation under federal law, including, without limitation, a 71
336336 partnership, S corporation, or unincorpora ted entity with or 72
337337 that elects pass-through taxation; 73
338338 (12) "Qualified rehearsal facility", a facility 74
339339 primarily used for rehearsals located in this state and 75
340340 which meets all of the following criteria: 76
341341 (a) Has a minimum of twelve thousand fiv e hundred 77
342342 square feet of column -free, unobstructed floor space in at 78
343343 least one rehearsal studio in the facility; 79
344344 (b) Has had a minimum of eight million dollars 80
345345 invested in the facility in land or structure, or a 81
346346 combination of land and structure; 82
347347 (c) Has a permanent grid system with a capacity of a 83
348348 minimum of five hundred thousand pounds in at least one 84
349349 rehearsal studio in the facility; 85 SCS HCS HBs 133 & 583 12
350350 (d) Has a height from floor to permanent grid of a 86
351351 minimum of fifty feet in at least one rehearsa l studio in 87
352352 the facility; 88
353353 (e) Has at least one sliding or roll -up access door 89
354354 with a minimum height of fourteen feet in the facility; 90
355355 (f) Has a security system which includes seven -days-a- 91
356356 week security cameras and the use of access control 92
357357 identification badges; 93
358358 (g) Has a service area with production offices, 94
359359 catering, and dressing rooms with a minimum of five thousand 95
360360 square feet; and 96
361361 (h) Is owned or operated by an entity that employs, on 97
362362 average on an annual basis, at least eighty facility full - 98
363363 time equivalent employees; 99
364364 A qualified rehearsal facility shall not include a facility 100
365365 at which concerts are regularly held; 101
366366 (13) "Resident", the same meaning as defined pursuant 102
367367 to section 143.101; 103
368368 (14) "Rehearsal", an event or series of events which 104
369369 occur in preparation for a tour prior to the start of the 105
370370 tour or during a tour when additional preparation may be 106
371371 needed; 107
372372 (15) "Rehearsal expenses", includes all of the 108
373373 following when incurred or when such expense s will be 109
374374 incurred during a rehearsal: 110
375375 (a) Total aggregate payroll; 111
376376 (b) Payment to a personal service corporation 112
377377 representing individual talent; 113
378378 (c) Payment to a pass-through entity representing 114
379379 individual talent; 115 SCS HCS HBs 133 & 583 13
380380 (d) Expenses related to construction, operations, 116
381381 editing, photography, staging, lighting, wardrobe, and 117
382382 accessories; 118
383383 (e) The leasing of vehicles from a Missouri vendor; 119
384384 (f) The transportation of people or concert tour 120
385385 equipment to or from a train station , bus depot, airport, or 121
386386 other transportation location, or from a residence or 122
387387 business entity; 123
388388 (g) Insurance coverage for an entire tour if the 124
389389 insurance coverage is purchased or will be purchased through 125
390390 an insurance agent that is a Missouri ve ndor; 126
391391 (h) Food and lodging from a Missouri vendor; 127
392392 (i) The purchase or rental of concert tour equipment 128
393393 from a Missouri vendor; 129
394394 (j) The rental of a qualified rehearsal facility; and 130
395395 (k) Emergency or medical support services require d to 131
396396 conduct a rehearsal; 132
397397 (16) "Total aggregate payroll", the total sum expended 133
398398 on salaries paid to resident employees, regardless of 134
399399 whether such resident is working within or outside of this 135
400400 state, or nonresident employees working within this state in 136
401401 one or more tours or rehearsals, including, without 137
402402 limitation, payments to a loan -out company. For the 138
403403 purposes of this subdivision: 139
404404 (a) With respect to a single employee, the portion of 140
405405 any salary which exceeds two million dollars in the 141
406406 aggregate for a single tour shall not be included when 142
407407 calculating total aggregate payroll; 143
408408 (b) All payments to a single employee and any legal 144
409409 entity in which the employee has any direct or indirect 145
410410 ownership interest shall be considered as having been paid 146 SCS HCS HBs 133 & 583 14
411411 to the employee and shall be aggregated regardless of the 147
412412 means of payment or distribution; and 148
413413 (c) Total aggregate payroll shall include payments to 149
414414 a loan-out company that has met its withholding tax 150
415415 obligations as provided in this paragraph. The taxpayer 151
416416 claiming the credit authorized pursuant to this section 152
417417 shall withhold Missouri income tax at the rate imposed 153
418418 pursuant to section 143.071 on all payments to loan -out 154
419419 companies for services performed in Missouri. Any amounts 155
420420 so withheld shall be deemed to have been withheld by the 156
421421 loan-out company on wages paid to its employees for services 157
422422 performed in Missouri, notwithstanding any exclusions under 158
423423 Missouri law for short -term employment of nonresident 159
424424 workers, out-of-state businesses, or otherwise. The amounts 160
425425 so withheld shall be allocated to the loan -out company's 161
426426 employees based on the payments made to the loan -out 162
427427 company's employees for services performed in Missouri. For 163
428428 the purposes of this section, loan -out company nonresident 164
429429 employees performing services in Missouri shall be 165
430430 considered taxable nonresidents and the loan -out company 166
431431 shall be subject to income taxation in the taxable year in 167
432432 which the loan-out company's employees perform services in 168
433433 Missouri, notwithstanding any other provisions of chapter 169
434434 143. Such withholding liability shall be subject to 170
435435 penalties and interest in the same manner as the employee 171
436436 withholding taxes imposed under chapter 143, and the 172
437437 department of revenue shall pro vide by regulation the manner 173
438438 in which such liability shall be assessed and collected; 174
439439 (17) "Tour", a series of concerts or other 175
440440 performances performed or to be performed by a musical or 176
441441 other live performer, including at least one rehearsal, in 177
442442 one or more locations over multiple days; 178 SCS HCS HBs 133 & 583 15
443443 (18) "Tour expenses", expenses incurred or which will 179
444444 be incurred during a tour including venues located in this 180
445445 state, including: 181
446446 (a) Total aggregate payroll; 182
447447 (b) The transportation of people or concert tour 183
448448 equipment to or from a train station, bus depot, airport, or 184
449449 other transportation location, or from a residence or 185
450450 business entity located in this state, or which is purchased 186
451451 or will be purchased from a Missouri vendor; 187
452452 (c) The leasing of vehicles provided by a Missouri 188
453453 vendor; 189
454454 (d) The purchasing or rental of facilities and 190
455455 equipment from or through a Missouri vendor; 191
456456 (e) Food and lodging which is incurred or will be 192
457457 incurred from a Missouri vendor; 193
458458 (f) Marketing or advertising a tour at venues located 194
459459 within this state; 195
460460 (g) Merchandise which is purchased or will be 196
461461 purchased from a Missouri vendor and used on the tour; 197
462462 (h) Payments made or that will be made to a personal 198
463463 service corporation repr esenting individual talent if income 199
464464 tax will be paid or accrued on the net income of the 200
465465 corporation for the taxable year pursuant to chapter 143; and 201
466466 (i) Payments made or that will be made to a pass - 202
467467 through entity representing individual talent for which 203
468468 withholding tax will be withheld by the pass -through entity 204
469469 on the payment as required pursuant to chapter 143; 205
470470 "Tour expenses" shall not include development expenses, 206
471471 including the writing of music or lyrics, or any expenses 207
472472 claimed by a taxpayer as rehearsal expenses. 208 SCS HCS HBs 133 & 583 16
473473 3. (1) For all tax years beginning on or after 209
474474 January 1, 2024, a taxpayer shall be allowed a tax credit 210
475475 for rehearsal expenses and tour expenses incurred by the 211
476476 taxpayer. The amount of the tax credit shall be equal to 212
477477 thirty percent of the taxpayer's base investment, subject to 213
478478 the limitations provided in subsection 6 of this section. 214
479479 No tax credit shall be authorized for rehearsal expenses or 215
480480 tour expenses related to a rehearsal or tour that does not 216
481481 meet the minimum rehearsal and tour requirements. 217
482482 (2) Tax credits issued pursuant to this section shall 218
483483 not be refundable. Any amount of tax credit that exceeds 219
484484 the tax liability for a taxpayer's tax year may be carried 220
485485 forward to any of the taxpayer's fi ve subsequent taxable 221
486486 years. 222
487487 4. (1) Tax credits authorized pursuant to this 223
488488 section may be transferred or sold in whole or in part by 224
489489 the taxpayer that claimed the tax credit, provided that the 225
490490 tax credit is transferred or sold to another Missou ri 226
491491 taxpayer. 227
492492 (2) A transferor may make one or more transfers or 228
493493 sales of tax credits claimed in a taxable year, and such 229
494494 transfers or sales may involve one or more transferees. 230
495495 (3) A transferor shall submit to the department and to 231
496496 the department of revenue a written notification of any 232
497497 transfer or sale of tax credits within thirty days after the 233
498498 transfer or sale of such tax credits. Such notification 234
499499 shall include the amount of the transferor's unredeemed tax 235
500500 credits prior to transfer, the tax credit identifying 236
501501 certificate number or other relevant identifying 237
502502 information, the remaining amount of unredeemed tax credits 238
503503 after transfer, all tax identification numbers for each 239
504504 transferee, the date of transfer, the amount transferred, 240 SCS HCS HBs 133 & 583 17
505505 and any other information required by the department or the 241
506506 department of revenue. 242
507507 (4) The transfer or sale of a tax credit authorized 243
508508 pursuant to this section shall not extend the time in which 244
509509 such tax credit may be redeemed. The carry-forward period 245
510510 for a tax credit that is transferred or sold shall begin on 246
511511 the date on which the tax credit was originally issued. 247
512512 (5) A transferee shall have only such rights to claim 248
513513 and redeem the tax credit that was available to such 249
514514 transferor at the time of the transfer, except for the 250
515515 transfer use of the tax credit authorized in subdivision (1) 251
516516 of this subsection. To the extent that such transferor did 252
517517 not have rights to claim or redeem the tax credit at the 253
518518 time of the transfer, the departmen t of revenue shall either 254
519519 disallow the tax credit claimed by the transferee or 255
520520 recapture the tax credit from the transferee. The 256
521521 transferee's recourse shall be against such transferor. 257
522522 (6) Tax credits shall not be transferred or sold for 258
523523 less than sixty percent of the value of such tax credits. 259
524524 (7) A taxpayer failing to comply with the provisions 260
525525 of this subsection shall not be able to redeem a tax credit 261
526526 until such taxpayer is in full compliance. 262
527527 5. The tax credits authorized pursu ant to this section 263
528528 shall be subject to the following conditions and limitations: 264
529529 (1) The tax credit may be taken beginning with the 265
530530 taxable year in which the taxpayer earning the tax credit 266
531531 has met the requirements provided pursuant to this secti on. 267
532532 For each year in which such taxpayer either claims or 268
533533 transfers the tax credit, the taxpayer shall attach a 269
534534 schedule to the taxpayer's Missouri income tax return which 270
535535 shall include the following information: 271 SCS HCS HBs 133 & 583 18
536536 (a) A description of the qualify ing activities and 272
537537 expenses; 273
538538 (b) A detailed listing of the employee names, Social 274
539539 Security numbers, and Missouri wages when salaries are 275
540540 included in the base investment; 276
541541 (c) The amount of the tax credit claimed pursuant to 277
542542 this section for the tax year; 278
543543 (d) Any tax credit previously taken by the taxpayer 279
544544 against Missouri income tax liabilities; 280
545545 (e) The amount of the tax credit carried over from 281
546546 prior years; 282
547547 (f) The amount of the tax credit utilized by the 283
548548 taxpayer claiming the tax credit in the current taxable 284
549549 year; and 285
550550 (g) The amount of the tax credit to be carried over to 286
551551 subsequent tax years; 287
552552 (2) In the initial tax year in which the taxpayer 288
553553 claims the credit authorized pursuant to this section, the 289
554554 taxpayer shall include a description of the qualifying 290
555555 activities and expenses that demonstrates that the minimum 291
556556 rehearsal and tour requirements are met; and 292
557557 (3) Any taxpayer claiming, transferring, or selling a 293
558558 tax credit pursuant to this section s hall be required to 294
559559 reimburse the department of revenue for any department - 295
560560 initiated audits relating to the tax credit. The provisions 296
561561 of this subdivision shall not apply to routine tax audits of 297
562562 a taxpayer which may include the review of the tax cred it 298
563563 authorized pursuant to this section. 299
564564 6. (1) The aggregate amount of tax credits that may 300
565565 be authorized in a given fiscal year pursuant to this 301
566566 section shall not exceed eight million dollars. If the 302
567567 amount of tax credits applied for by taxpay ers exceeds such 303 SCS HCS HBs 133 & 583 19
568568 amount, the department may, at its discretion, authorize 304
569569 additional tax credits in an amount not to exceed two 305
570570 million dollars in such fiscal year, provided that the 306
571571 maximum amount of tax credits that may be authorized during 307
572572 the subsequent fiscal year shall be reduced by the amount of 308
573573 additional tax credits that the department authorizes. 309
574574 (2) Notwithstanding the provisions of subdivision (1) 310
575575 of subsection 3 of this section to the contrary, the amount 311
576576 of tax credits claimed by a taxpayer pursuant to this 312
577577 section during a fiscal year shall not exceed the following 313
578578 amounts: 314
579579 (a) If a taxpayer's base investment is less than four 315
580580 million dollars, the taxpayer shall not be awarded more than 316
581581 one million dollars in tax credit s in a fiscal year; 317
582582 (b) If a taxpayer's base investment is at least four 318
583583 million dollars but less than eight million dollars, the 319
584584 taxpayer shall not be awarded more than two million dollars 320
585585 in tax credits in a fiscal year; and 321
586586 (c) If a taxpayer's base investment is at least eight 322
587587 million dollars, the taxpayer shall not be awarded more than 323
588588 three million dollars in tax credits in a fiscal year. 324
589589 7. The department shall promulgate such rules and 325
590590 regulations as are necessary to implement and administer the 326
591591 provisions of this section. Any rule or portion of a rule, 327
592592 as that term is defined in section 536.010, that is created 328
593593 under the authority delegated in this section shall become 329
594594 effective only if it complies with and is subject to all of 330
595595 the provisions of chapter 536 and, if applicable, section 331
596596 536.028. This section and chapter 536 are nonseverable and 332
597597 if any of the powers vested with the general assembly 333
598598 pursuant to chapter 536 to review, to delay the effective 334
599599 date, or to disapprove and annul a rule are subsequently 335 SCS HCS HBs 133 & 583 20
600600 held unconstitutional, then the grant of rulemaking 336
601601 authority and any rule proposed or adopted after August 28, 337
602602 2023, shall be invalid and void. 338
603603 8. Pursuant to section 23.253 of the Missouri sunset 339
604604 act: 340
605605 (1) The program authorized pursuant to this section 341
606606 shall automatically sunset on December 31, 2030, unless 342
607607 reauthorized by an act of the general assembly; 343
608608 (2) If such program is reauthorized, the program 344
609609 authorized pursuant to this section shall automatically 345
610610 sunset on December thirty -first, twelve years after the 346
611611 effective date of the reauthorization; 347
612612 (3) This section shall terminate on September first of 348
613613 the calendar year immediately following the calendar year in 349
614614 which the program authorized pursuant to this section is 350
615615 sunset; and 351
616616 (4) The provisions of this subsection shall not be 352
617617 construed to limit or in any way impair the department's 353
618618 ability to redeem tax credits authorized on or before the 354
619619 date the program authorize d pursuant to this section expires 355
620620 or a taxpayer's ability to redeem such tax credits. 356
621621 9. (1) Notwithstanding the provisions of subsection 8 357
622622 of this section, the provisions of this section shall 358
623623 automatically terminate and expire ninety days afte r the 359
624624 department determines that all other state and local 360
625625 governments in the United States of America have terminated 361
626626 or let lapse their tax credit or other governmental 362
627627 incentive program for the music or performance entertainment 363
628628 industries, regardless of whether such credits or programs 364
629629 are now in effect or first commence after the effective date 365
630630 of this section. The department shall notify the revisor of 366
631631 statutes upon the department's determination that the tax 367 SCS HCS HBs 133 & 583 21
632632 credit authorized by this sectio n shall terminate pursuant 368
633633 to this subsection. 369
634634 (2) The provisions of this subsection shall not be 370
635635 construed to limit or in any way impair the ability of any 371
636636 taxpayer that has met the requirements in this section prior 372
637637 to the termination of this s ection to participate in the 373
638638 program authorized under this section. The provisions of 374
639639 this section shall not be construed to limit or in any way 375
640640 impair the department's ability to redeem tax credits 376
641641 qualified for on or before the date the program auth orized 377
642642 pursuant to this section expires. 378
643643 Section B. The enactment of section 135.753 of this 1
644644 act shall become effective January 1, 2024. 2
645645