§ 44-5-38 - Rate of levy against tangible personal property consisting of manufacturing machinery and equipment acquired or used by a manufacturer.
SECTION 44-5-38
§ 44-5-38 Rate of levy against tangiblepersonal property consisting of manufacturing machinery and equipment acquiredor used by a manufacturer. – Tangible personal property consisting of manufacturing machinery and equipmentacquired, owned, or used by a manufacturer is subject to taxation at a uniformrate of assessment not to exceed fifty percent (50%) of the full and fair cashvalue of the property. The levy and assessment of the tax upon themanufacturer's manufacturing machinery and equipment is subject to, and limitedto, the following:
(1) Assessment and levy on manufacturer's machinery andequipment. In assessing the valuation of the property and apportioning the levyof the tax on December 31, 1968, the assessors in the several cities and townsshall not exceed seventy-five percent (75%) of the total adjusted levy on themachinery, equipment, and inventories of all manufacturers of the city or townas established by the division of local and metropolitan government using thelevy based on the assessment of the city or town as of December 31, 1966. Inapportioning the levy as established in this subdivision, the assessor may addto the total adjusted levy, the increase in levy on manufacturer's machinery,equipment, and inventory occasioned by manufacturers found to be operating butnot taxed in the city or town as of December 31, 1966, or who have located inthe city or town since that date.
(ii) In apportioning the levy of the tax on manufacturers'machinery and equipment within a city or town for fiscal years ending afterDecember 31, 1969, the assessors of any city or town shall apportion the levyof the tax in an amount not to exceed one hundred three and one-half percent(103.5%) of the total adjusted levy on manufacturer's machinery and equipmentfor the next prior fiscal year. In apportioning the levy of the tax, asprovided in this subdivision, the assessors of any city or town may add to thetotal adjusted levy for the next prior fiscal year, the increase in levy onmanufacturer's machinery and equipment occasioned by manufacturers who havelocated or who have increased investment within the meaning of subdivision (3)in the city or town since the date of the next prior assessment.
(2) Assessment and levy on individual manufacturers. Inassessing the valuation of the property and apportioning the levy of the tax onDecember 31, 1968, the assessors of the several cities and towns shall notexceed seventy-three and one-half percent (73.5%) of the adjusted levy of thetax on the machinery, equipment, and inventory of any manufacturer of the cityor town for the next prior year. If the application of the preceding provisionresults in the total tax levy thus obtained on manufacturers' machinery andequipment of a city or town for the year for which the date of assessment ofvaluations was December 31, 1968, as the assessment of valuations isestablished under the provisions of the first paragraph of this section, beingless in amount than the amount of the total adjusted levy as computed inaccordance with the seventy-five percent (75%) limitation prescribed under theprovisions of paragraph (1)(i) of this section, the assessor of the city ortown, for the purpose of bringing the total levy on the machinery and equipmentto an amount not exceeding the amount of the total adjusted levy as computed bythe seventy-five percent (75%) limitation, may apply the amount of the totaladjusted tax levy, as was thus limited and computed under the provisions ofparagraph (1)(i) of this section, to the total assessed valuation as ofDecember 31, 1968, as the valuation is established under the provisions of thefirst paragraph of this section, on the machinery and equipment of allmanufacturers of the city or town, and apply the resulting classified tax rateto the assessed valuations as of December 31, 1968, on the machinery andequipment of each manufacturer of the city or town.
(ii) In assessing the valuation of the property andapportioning the levy of the tax for fiscal years ending after December 31,1969, the assessors of the several cities and towns shall not exceed onehundred five percent (105%) of the adjusted levy of the tax on the machineryand equipment of any manufacturer for the next prior fiscal year.
(3) As to the property constituting an increase ininvestment, the limitations fixed in subdivisions (1) and (2) of this sectiondo not apply to that portion of the tax levy on a manufacturer derived from asubstantial increase in investment in additional machinery and equipment orthat portion of the tax levy applicable to the property not previously taxed inthe city or town. For the purposes of this section, "substantial" means aninvestment in any one year equal to at least fifteen percent (15%) of the sumof net book value plus accumulated reserves for depreciation of other machineryand equipment of the manufacturer within the city or town.
(4) When a city or town has completed a revaluation of allratable property by independent professional appraisers since December 31,1966, the assessor of the city or town shall, in applying the precedinglimitations, employ the levy and assessment made for the fiscal yearimmediately following the completion of the revaluation in lieu of the baseestablished as previously established by the division of local and metropolitangovernment; provided, that a base year later than a fiscal year commencing in1969 is not employed.
(5) Nothing in this section affects any agreement for thestabilization or exemption of local taxes entered into under the provisions of§ 44-3-9; provided, that any agreement may be modified to take intoaccount the effect of § 44-11-2 by the city or town council and themanufacturer without the necessity of meeting the criteria and complying withthe procedures established in § 44-3-9. Upon the expiration of anyexisting agreement, the tax on the property consisting of manufacturers'machinery, equipment, and inventory formerly stabilized or exempted under theagreement shall be based upon a new assessment complying with all the terms ofthis section.
(6) Each city or town has the option of using its generalproperty tax rate in computing its levy on machinery and equipment ofmanufacturers or any separate rate, which it deems appropriate subject to therestrictions established in this section.
(7) In order to assess accurately the impact of theprovisions of this section upon the several cities and towns and to providenecessary information for that purpose, each manufacturer subject to taxationin any city or town shall submit to the division of local and metropolitangovernment on or before October 1, 1966, a declaration report on the value ofmachinery and equipment for each city or town in which the manufacturer islocated; the declaration reports shall be submitted on a form designed andfurnished by the division and shall provide for inclusion of the net book valueand the accumulated reserve for depreciation of machinery and equipment subjectto local taxation, all as reported in the manufacturers' most recent RhodeIsland corporate tax return. The declaration report shall cover the most recentfiscal year of the taxpayer for which the due date for the filing of acorporate tax return with the tax administrator is prior to the date prescribedin this section for filing the report; provided, that where a manufacturerfiles a corporate tax return with the tax administrator on or prior to the dateof October 1 for the fiscal year, the manufacturer shall file the declarationreport on or before October 1.
(ii) On or before October 1, 1968, and annually thereafter,each manufacturer shall file with the office of the assessor of the city ortown in which the property is situated, a declaration report, as described inparagraph (1)(i) of this section, on a form prescribed by the department ofrevenue and furnished to the local assessors. All reports shall be treatedconfidentially by the assessor and employed by him or her for assessmentpurposes only.
(iii) Failure to submit a declaration report to either thedepartment of revenue or the tax assessor of any city or town as required insubdivision (1)(i) subjects the manufacturer to a penalty not to exceed tenpercent (10%) of the tax on machinery and equipment payable at the time whenthe taxes are due and payable as an addition to the tax due in the nextsucceeding year and the penalty shall be so identified and listed on the taxroll. Should a manufacturing establishment fail to submit a declaration reportfor a second successive year, it is subject to a penalty not to exceedtwenty-five percent (25%) of its tax on machinery and equipment, payable asprescribed; should a manufacturing establishment fail for a third successiveyear to file the declaration report it is subject to a penalty not to exceedfifty percent (50%) of the tax on its machinery and equipment, payable asprescribed; for subsequent successive years, failure to file the declarationreport subjects the manufacturing establishment to a penalty not to exceedfifty percent (50%) of its tax on machinery and equipment, payable asprescribed. As to any manufacturer failing to file a declaration report withthe local assessor as required in this section, the limitation of paragraph(2)(ii) of this section shall not take effect until the assessment date nextfollowing the date upon which the manufacturer first files a report with theassessor. In lieu of the declaration report, any manufacturer subject totaxation for the first time in any city or town of this state shall submit theinformation that is necessary to establish its initial tax base and, insubsequent years, shall file the declaration report.
(8) In any case where the assessor of any city or town hasreason to doubt the veracity of the contents of any declaration report sofiled, the report may be submitted to the department of revenue, which shallcompare the information contained in the report with information on file withthe division of taxation and advise the assessor as to the veracity of thereport.
(9) A manufacturer who stores or keeps on hand raw materials,work in process, and his or her finished products in a storage place (asdistinguished from finished products which he or she holds for retail sale inany retail establishment operated by him or her) in a city or town other thanthat in which his or her manufacturing plant is located shall file on or beforeMarch 15, 1969, and annually thereafter on or before each succeeding March 15,an inventory report on a form prescribed and furnished by the department ofrevenue through the assessor, with the assessor of the city or town where theraw materials and finished products are stored. The assessor of each city ortown shall notify all manufacturers of the city or town of the requirement forfiling the reports by publication in a newspaper of general circulation in thecity or town during the month of January, 1969, and during the same month ineach year thereafter. The report shall contain a true account of the rawmaterials, work in process, and finished products that were manufactured by himor her in this state as well as any other merchandise owned or possessed by himor her in the city or town on December 31 next preceding the date specified forthe filing of the inventory report. The report must describe and specify thevalue of the raw materials, work in process, and finished products that weremanufactured as already stated and also the value of all other merchandisestored in the city or town. Any manufacturer who fails or refuses to file anyinventory report at the time and in the manner prescribed in this section isdeemed to have waived the tax exemption provided for on the raw materials, workin process, and finished products thus stored, whereupon, and notwithstandingthe provisions of § 44-3-3(20), the property is subject to taxation likeall other taxable property. The provisions of this subdivision shall not beconstrued to repeal § 44-5-15 or to limit the application of itsprovisions.
(10) A manufacturer who operates storage facilities for thestorage of his raw materials, work in process, and finished products in a cityor town other than that in which his or her manufacturing plant is locatedshall set forth in the declaration report, as and in the manner prescribed insubdivision (7) of this section to be filed with the assessor of the city ortown where the storage facilities are located, any machinery and equipmentowned or possessed by him or her which is situated in or upon the storagefacilities for use in the operation of the storage facilities, or held therefor use in the operation of the manufacturing plant.
(11) The restrictions contained in this chapter shall notapply to the portion of the tax, if any, assessed by the city or town for thepurpose of paying the indebtedness of the city or town and the indebtedness ofthe state or any political subdivision of the state to the extent assessed uponor apportioned to the city or town, and the interest thereon; and forappropriation to any sinking fund of the city or town (which portion of the taxis paid in full).
(12) Any person who hires a person from public supportedprograms for persons with disabilities and rehabilitated, shall receive a fivehundred dollar ($500) credit per person hired; provided, that the number of thepersons increases the number of full-time employees by three percent (3%) ofthe total numbers of persons employed the previous year.
(13) For purposes of this subdivision, in determining thetotal amount of the tax levy on manufacturing machinery and equipment owned orused by a manufacturer on December 31, 1973, the assessors in the severalcities and towns shall not exceed ninety percent (90%) of the levy on the classof property made as of December 31, 1972; thereafter annually commencing in1974 on December 31, the assessors shall reduce the levy on the class ofproperty whether or not acquired subsequent to December 31, 1972, except asprovided in this section, as follows: to eighty percent (80%) of the December31, 1972, levy on December 31, 1974; to seventy percent (70%) of the December31, 1972, levy on December 31, 1975; to sixty percent (60%) of the December 31,1972, levy on December 31, 1976; to fifty percent (50%) of the December 31,1972, levy on December 31, 1977; to forty percent (40%) of the December 31,1972, levy on December 31, 1978; to thirty percent (30%) of the December 31,1972, levy on December 31, 1979; to twenty percent (20%) of the December 31,1972, levy on December 31, 1980; to ten percent (10%) of the December 31, 1972,levy on December 31, 1981 and to continue at ten percent (10%) of the December31, 1972, levy on December 31, 1982; and to five percent (5%) of the December31, 1972, levy on December 31, 1983; and thereafter the property is exempt fromtaxation.