| 1 | The Committee on Commerce recommends the following: |
| 2 |
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| 3 | Committee Substitute |
| 4 | Remove the entire bill and insert: |
| 5 | A bill to be entitled |
| 6 | An act relating to tax administration; amending ss. |
| 7 | 213.235 and 220.807, F.S.; providing an alternative to a |
| 8 | requirement that the interest rate on certain tax |
| 9 | deficiencies shall be the rounded adjusted prime rate |
| 10 | charged by banks plus 4 percentage points; providing |
| 11 | legislative intent relating to application of certain |
| 12 | adjustments to certain rates of interest; providing an |
| 13 | effective date. |
| 14 |
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| 15 | Be It Enacted by the Legislature of the State of Florida: |
| 16 |
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| 17 | Section 1. Section 213.235, Florida Statutes, is amended |
| 18 | to read: |
| 19 | 213.235 Determination of interest on deficiencies.-- |
| 20 | (1) For the period January 1, 2000, through June 30, 2004, |
| 21 | notwithstanding any other provision of law, the annual rate of |
| 22 | interest applicable to tax payment deficiencies that arise on or |
| 23 | after January 1, 2000, through June 30, 2004, shall be the |
| 24 | adjusted rate established by the executive director of the |
| 25 | department under subsection (2), unless a lower rate for the |
| 26 | particular tax is specifically provided for in law, in which |
| 27 | case the lower rate applies. This annual rate of interest |
| 28 | applies to all taxes enumerated in s. 213.05. |
| 29 | (2)(a) If the adjusted prime rate charged by banks, |
| 30 | rounded to the nearest full percent, plus 4 percentage points, |
| 31 | during either: |
| 32 | 1.(a) The 6-month period ending on September 30 of any |
| 33 | calendar year;, or |
| 34 | 2.(b) The 6-month period ending on March 31 of any |
| 35 | calendar year, |
| 36 |
|
| 37 | differs from the interest rate in effect on either such date, |
| 38 | the executive director of the department shall, within 20 days, |
| 39 | establish an adjusted rate of interest equal to such adjusted |
| 40 | prime rate plus 4 percentage points. |
| 41 | (b)(3) An adjusted rate of interest established under this |
| 42 | section becomes effective: |
| 43 | 1.(a) On January 1 of the succeeding year, if based upon |
| 44 | the adjusted prime rate plus 4 percentage points for the 6-month |
| 45 | period ending on September 30; or |
| 46 | 2.(b) On July 1 of the same calendar year, if based upon |
| 47 | the adjusted prime rate plus 4 percentage points for the 6-month |
| 48 | period ending on March 31. |
| 49 | (3) The annual rate of interest for periods on or after |
| 50 | July 1, 2004, applicable to tax payment deficiencies that arise |
| 51 | on or after July 1, 2004, and on tax payment deficiencies that |
| 52 | arose on January 1, 2000, through June 30, 2004, but remain |
| 53 | unpaid on or after July 1, 2004, shall be the adjusted rate |
| 54 | established by the executive director of the department under |
| 55 | subsection (4), unless a lower rate for the particular tax is |
| 56 | specifically provided for in law, in which case the lower rate |
| 57 | applies. This annual rate of interest applies to all taxes |
| 58 | enumerated in s. 213.05. |
| 59 | (4)(a) If the adjusted prime rate charged by banks, |
| 60 | rounded to the nearest full percent, during: |
| 61 | 1. The 6-month period ending on September 30 of any |
| 62 | calendar year; or |
| 63 | 2. The 6-month period ending on March 31 of any calendar |
| 64 | year, |
| 65 |
|
| 66 | differs from the interest rate in effect on either such date, |
| 67 | the executive director of the department shall, within 20 days, |
| 68 | establish an adjusted rate of interest equal to such adjusted |
| 69 | prime rate. |
| 70 | (b) An adjusted rate of interest established under this |
| 71 | section becomes effective: |
| 72 | 1. On January 1 of the succeeding year, if based upon the |
| 73 | adjusted prime rate for the 6-month period ending on September |
| 74 | 30; or |
| 75 | 2. On July 1 of the same calendar year, if based upon the |
| 76 | adjusted prime rate for the 6-month period ending on March 31. |
| 77 | (5)(4) As used in this section, the term "adjusted prime |
| 78 | rate charged by banks" means the average predominant prime rate |
| 79 | quoted by commercial banks to large businesses, as determined by |
| 80 | the Board of Governors of the Federal Reserve System. |
| 81 | (6)(5) Once established, an adjusted rate of interest |
| 82 | remains in effect until further adjusted under subsection (2) or |
| 83 | subsection (4). |
| 84 | Section 2. Section 220.807, Florida Statutes, is amended |
| 85 | to read: |
| 86 | 220.807 Determination of rate of interest.-- |
| 87 | (1) The annual rate of interest applicable under to this |
| 88 | chapter for the period January 1, 2000, through June 30, 2004, |
| 89 | shall be the adjusted rate established by the executive director |
| 90 | of the Department of Revenue under subsection (2), except that |
| 91 | the annual rate of interest shall never be greater than 12 |
| 92 | percent. |
| 93 | (2)(a) If the adjusted prime rate charged by banks, |
| 94 | rounded to the nearest full percent, plus 4 percentage points, |
| 95 | during either: |
| 96 | 1.(a) The 6-month period ending on September 30 of any |
| 97 | calendar year; or |
| 98 | 2.(b) The 6-month period ending on March 31 of any |
| 99 | calendar year, |
| 100 |
|
| 101 | differs from the interest rate in effect on either such date, |
| 102 | the executive director of the Department of Revenue shall, |
| 103 | within 20 days, establish an adjusted rate of interest equal to |
| 104 | such adjusted prime rate plus 4 percentage points. |
| 105 | (b)(3) An adjusted rate of interest established under this |
| 106 | section shall become effective: |
| 107 | 1.(a) On January 1 of the succeeding year, if based upon |
| 108 | the adjusted prime rate plus 4 percentage points for the 6-month |
| 109 | period ending on September 30; or |
| 110 | 2.(b) On July 1 of the same calendar year, if based upon |
| 111 | the adjusted prime rate plus 4 percentage points for the 6-month |
| 112 | period ending on March 31. |
| 113 | (3) The annual rate of interest applicable under this |
| 114 | chapter on or after July 1, 2004, shall be the adjusted rate |
| 115 | established by the Department of Revenue under subsection (4) |
| 116 | except that the annual rate of interest shall never be greater |
| 117 | than 12 percent. |
| 118 | (4)(a) If the adjusted prime rate charged by banks, |
| 119 | rounded to the nearest full percent during: |
| 120 | 1. The 6-month period ending on September 30 of any |
| 121 | calendar year; or |
| 122 | 2. The 6-month period ending on March 31 of any calendar |
| 123 | year, |
| 124 |
|
| 125 | differs from the interest rate in effect on either such date, |
| 126 | the executive director of the Department of Revenue shall, |
| 127 | within 20 days, establish an adjusted rate of interest equal to |
| 128 | such adjusted prime rate. |
| 129 | (b) An adjusted rate of interest established under this |
| 130 | subsection shall become effective: |
| 131 | 1. On January 1 of the succeeding year, if based upon the |
| 132 | adjusted prime rate of the 6-month period ending on September |
| 133 | 30; or |
| 134 | 2. On July 1 of the same calendar year, if based upon the |
| 135 | adjusted prime rate for the 6-month period ending March 31. |
| 136 | (5)(4) For the purposes of this section, "adjusted prime |
| 137 | rate charged by banks" means the average predominant prime rate |
| 138 | quoted by commercial banks to large business, as determined by |
| 139 | the Board of Governors of the Federal Reserve System. |
| 140 | (6)(5) Once established, an adjusted rate of interest |
| 141 | shall remain in effect until an adjustment is made under |
| 142 | subsection (2) or subsection (4). |
| 143 | Section 3. It is the intent of the Legislature that the |
| 144 | provisions of s. 213.235(1) and (2), Florida Statutes, and s. |
| 145 | 220.807(1) and (2), Florida Statutes, as amended by this act, |
| 146 | apply to interest due on tax payment deficiencies that arise on |
| 147 | or after January 1, 2000, but before July 1, 2004. It is also |
| 148 | the intent of this act that the rate of interest that continues |
| 149 | to accrue in any period after June 2004, for any tax payment |
| 150 | deficiency that arose on or after January 1, 2000, or refund |
| 151 | claim filed on or after January 1, 2000, shall be at prime as |
| 152 | provided for in ss. 213.235(4) and 220.807(4), Florida Statutes. |
| 153 | The allowance and payments of interest on overpayments of tax |
| 154 | continue to be subject to the provisions of ss. 213.255(12) and |
| 155 | 220.723(1), Florida Statutes. |
| 156 | Section 4. This act shall take effect July 1, 2004. |