New/Expanding Business Income Tax Exemption

Note: This exemption is subject to the state and local tax clearance requirements.

Qualifications

A primary sector or tourism business may qualify for an income tax exemption for up to five years. "Primary sector" refers to a business that adds value to a product, process, or service that produces new wealth in North Dakota. "Tourism" refers to a tourism-related business that is a destination attraction. Eligibility is limited to a new business or to an existing business that expands its operations in North Dakota.

A business is not eligible for the exemption if:

• the business received a property tax exemption under tax increment financing,
• there is an outstanding recorded lien for delinquent property, income, sales or use taxes against the business, or
• the exemption fosters unfair competition or endangers existing business.

Application Procedures

Application for New or Expanding Business Income Tax Exemption (Project Operator's Application for Income Tax Exemption)

• The business must apply to the Corporate Income Tax Section, c/o State Tax Commissioner.
• The application must be filed no later than one year after the commencement of operations within the new business or expansion.
• The Department of Commerce Division of Economic Development and Finance reviews the application for primary sector or tourism eligibility.
• The business must provide notice to competitors as prescribed by the State Board of Equalization.
• At a public meeting, the State Board considers the application and any testimony, and grants or denies the exemption.

Reference: N.D.C.C. ch. 40-57.1