H.B. 753                                                 VETOES

[(2)] (4) (i) In this paragraph:

1. "manufacturing corporation" means a domestic or foreign
corporation which is primarily engaged in activities that, in accordance with the
North American Industrial Classification System (NAICS), United States Manual,
United States Office of Management and Budget, 1997 Edition, would be included in
Sector 11, 31, 32, or 33; and

2. "manufacturing corporation" does not include a refiner, as
defined in § 10-101 of the Business Regulation Article.
(ii) If a manufacturing corporation carries on its trade or business
in and out of the State and the trade or business is a unitary business, the part of the
corporation's Maryland modified income THAT IS OPERATIONAL INCOME derived
from or reasonably attributable to trade or business carried on in the State shall be
determined using a single sales factor apportionment formula, by multiplying its
Maryland modified income by 100% of the sales factor.

(iii) In filing its tax return for each year, a manufacturing
corporation shall certify that the NAICS Code reported on its Maryland return is
consistent with that reported to other government agencies.

(iv) If the Comptroller determines that a corporation has submitted
information that incorrectly classifies the corporation as a manufacturing corporation
under subparagraph (i) of this paragraph, the Comptroller shall reclassify the
corporation in an appropriate manner.

(v) The Comptroller, in consultation with the Department of
Business and Economic Development, shall adopt regulations necessary to carry out
the provisions of this subsection.

(vi) As part of its tax return for a taxable year beginning after
December 31, 2000 but before January 1, 2003, each manufacturing corporation that
has more than 25 employees and apportions its income under this paragraph shall
submit a report, in the form that the Comptroller requires by regulation, that
describes for each taxable year as of the last day of the taxable year the following:

1. the difference in tax owed as a result of using single sales
factor apportionment method under this paragraph as compared to the tax owed
using the 3-factor double weighted sales factor apportionment method in effect for
the last taxable year beginning on or before December 31, 2000;

2. volume of sales in the State and worldwide;

3. taxable income in the State and worldwide; and

4. book value of plant, land, and equipment in the State and
worldwide.

(vii) On or before October 1, 2003 and October 1, 2004, and
notwithstanding any confidentiality requirements, the Comptroller shall prepare and
submit to the Governor and, subject to § 2-1246 of the State Government Article, to

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