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Please support Senate Bill 494 – "To reduce the capital gains on employee owned stock" at hearing on March 6 in Helena.

February 26, 2007 /

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PFL Tech Inc. is a marketing technology company that provides sales enablement and marketing automation solutions, as well asprinting, mailing, and fulfillment services. They also provide some great Montana Jobs.

Senate Bill 494 would reduce the capital gains rate on employee owned stock for companies headquartered in the state of Montana to a flat 2%.

Currently the tax rate is in excess of 5%. This legislation is modeled after successful bills in other states and would directly benefit all Montana companies and their employees with at least 25 full time staff. The bill is being sponsored by Senator Gary Perry.

In the 2003 session the bill enjoyed strong bi-partisan support and passed the full Senate, but did not pass the House. The fiscal impact is limited to $350K per year according to the fiscal note for the bill, but this analysis does not include any increased revenue from the sale of stock that does not leave the state before it is sold.

Currently people who leave the state before selling appreciated stock owe no Montana tax; Essentially 2% of something is going to be much more that 5+% of nothing, so it should actually increase state revenues.

Public testimony will be accepted by the Senate Tax Committee on Tuesday March 6th at 9AM in room 405 at the capital in Helena. Anyone interested in supporting this important legislation is encouraged to attend and testify, or you can write letters of support directly to:

Senator Gary Perry

Montana Senate

PO Box 200500

Helena, MT 59620-0500

or send an e-mail to:

[email protected]

as well as your elected representatives:
http://leg.mt.gov/css/sessions/60th/roster.asp?HouseID=0&SessionID=91

This bill is very pragmatic way to encourage employee stock ownership and entrepreneurship in the state. If you have questions about the bill, please contact me.

Thank you.

Greg Gianforte, CEO and Founder

RightNow Technologies

406-522-4204

http://www.rightnow.com

SENATE BILL NO. 494

INTRODUCED BY G. PERRY

A BILL FOR AN ACT ENTITLED: "AN ACT ALLOWING A TAXPAYER TO ELECT TO HAVE CERTAIN NET LONG-TERM CAPITAL GAINS THAT ARE ATTRIBUTABLE TO THE SALE OR EXCHANGE OF CAPITAL STOCK OF A CORPORATION ACQUIRED ON ACCOUNT OF EMPLOYMENT BY THE CORPORATION OR WHILE EMPLOYED BY THE CORPORATION TO BE TAXED AT A SINGLE TAX RATE; AMENDING SECTION 15-30-137, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND A RETROACTIVE APPLICABILITY DATE."

http://data.opi.mt.gov/bills/2007/billhtml/SB0494.htm