§ 105-120.2. Franchise or privilege tax on holding companies. - North Carolina Statutes

§ 105‑120.2.  Franchiseor privilege tax on holding companies.

(a)        Every corporation,domestic and foreign, incorporated or, by an act, domesticated under the lawsof this State or doing business in this State which, at the close of itstaxable year is a holding company as defined in subsection (c) of this section,shall, pursuant to the provisions of G.S. 105‑122:

(1)        Make a report andstatement, and

(2)        Determine the totalamount of its issued and outstanding capital stock, surplus and undividedprofits, and

(3)        Apportion suchoutstanding capital stock, surplus and undivided profits to this State.

(b)       (1)        Everycorporation taxed under this section shall annually pay to the Secretary ofRevenue, at the time the report and statement are due, a franchise or privilegetax, which is hereby levied, at the rate of one dollar and fifty cents ($1.50)per one thousand dollars ($1,000) of the amount determined under subsection (a)of this section, but in no case shall the tax be more than seventy‑fivethousand dollars ($75,000) nor less than thirty‑five dollars ($35.00).

(2)        Notwithstanding theprovisions of subdivision (1) of this subsection, if the tax produced pursuantto application of this paragraph (2) exceeds the tax produced pursuant toapplication of subdivision (1), then the tax shall be levied at the rate of onedollar and fifty cents ($1.50) per one thousand dollars ($1,000) on the greaterof the amounts of

a.         Fifty‑fivepercent (55%) of the appraised value as determined for ad valorem taxation ofall the real and tangible personal property in this State of each suchcorporation plus the total appraised value of intangible property returned fortaxation of intangible personal property as computed under G.S. 105‑122(d);or

b.         The total actualinvestment in tangible property in this State of such corporation as computedunder G.S. 105‑122(d).

(c)        For purposes ofthis section, a "holding company" is a corporation that receivesduring its taxable year more than eighty percent (80%) of its gross income fromcorporations in which it owns directly or indirectly more than fifty percent(50%) of the outstanding voting stock or voting capital interests.

(d)        Repealed by SessionLaws 1985, c. 656, s. 39.

(e)        Counties, citiesand towns shall not levy a franchise tax on corporations taxed under thissection. The tax imposed under the provisions of G.S. 105‑122 shall notapply to businesses taxed under the provisions of this section.

(f)         In determining thetotal tax payable by any holding company under this section, there shall beallowed as a credit on such tax the amount of the credit authorized under Part5 of Article 4 of this Chapter. (1975, c. 130, s. 1; 1985, c. 656, s. 39; 1985 (Reg.Sess., 1986), c. 854, s. 1; 1987 (Reg. Sess., 1988), c. 882, s. 4.2; 1991, c.30, s. 4; 1998‑98, s. 72; 2006‑196, s. 9.)