Financial institution affiliate income

From the 2024 DOR Tax Exemption Study

82.04.645 - Financial institution affiliate income Description Financial institutions are exempt from B&O tax on amounts received from affiliates from arm's length transactions as required under the Federal Reserve Act (sections 23A or 23B). Purpose To encourage affiliate transactions by financial institutions. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes Indeterminate Indeterminate Indeterminate Indeterminate Local Taxes $0.000 $0.000 $0.000 $0.000 Repeal of Repealing this exemption would increase revenues. However, not all affiliate exemption transactions would be taxable at full market value. Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repeal State Taxes $0.000 Indeterminate Indeterminate Indeterminate Local Taxes $0.000 $0.000 $0.000 $0.000 Assumptions - Information on amounts received from affiliates that require an arm's length transaction under the Federal Reserve Act (section 23A or 23B) do not appear on state excise tax returns or financial institution federal reports. The revenue impact of this bill is indeterminate. Data Sources - Department of Revenue, Excise tax data - Federal Financial Institution