Manufacturers that qualify for exemptions based on payroll conditions should inquire with State Officials if they have been faced with layoffs during these economic times.  One condition requires that the initial application reflect a net increase in annualized payroll which must be maintained or increased for each subsequent year.  Because layoffs almost certainly decrease the annualized payroll, a taxpayer risks not qualifying for the exemptions. 

The Oklahoma Legislature is currently considering Senate Bill 929, which may suspend the payroll maintenance requirement if a facility has been in existence for ten (10) years and employs at least 250 people. Other bills may also be introduced in this session to address the loss of exemptions due to employee layoffs. 

All manufacturers should carefully consider the value of tax exemptions which might be lost as a result of layoffs. They should also monitor pending legislation which could affect eligibility for exemptions. 

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