Senate Bill No. 460
(By Senators Helmick, McCabe and Unger)
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[Introduced February 3, 2010; referred to the Committee
on Finance.]
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A BILL to amend and reenact §11-12-5 of the Code of West
Virginia, 1931, as amended, relating to the business
registration tax; specifying that the business registration
tax and business registration certificate are subject to the
exemptions, exceptions and requirements set forth in §11-12-
3 of said code; and specifying that the tax is imposed for
each and every issuance, reissuance or reinstatement of a
business registration certificate.
Be it enacted by the Legislature of West Virginia:
That §11-12-5 of the Code of West Virginia, 1931, as
amended, be amended and reenacted to read as follows:
ARTICLE 12. BUSINESS REGISTRATION TAX.
§11-12-5. Time for which registration certificate granted; power
of Tax Commissioner to suspend or cancel
certificate; certificate to be permanent until cessation
of business for which certificates are granted or
revocation, suspension or cancellation by the Tax
Commissioner; penalty for involuntary loss of
license due to failure to pay required fees and taxes
relating to business.
(a)
Registration period. -- All business registration
certificates issued under the provisions of section four of this
article are for the period of one year beginning July 1 and
ending
the thirtieth day of the following June June 1 of the
following year: Provided, That beginning on or after July 1,
1999, all business registration certificates issued under the
provisions of section four of this article shall be issued for
two fiscal years of this state, subject to the following
transition rule. If the first year for which a business was
issued a business registration certificate under this article
began on July 1 of an even-numbered calendar year, then the Tax
Commissioner may issue a renewal certificate to that business for
the period beginning July 1, 1999, and ending June 30, 2000, upon
receipt of $15 for each such one-year certificate.
Notwithstanding any other provisions of this code to the
contrary, any certificate of registration granted on or after
July 1, 2010, shall not be subject to the foregoing requirement
that it be renewed, but shall be permanent until cessation of the
business for which the certificate of registration was granted or
until it is suspended, revoked or cancelled by the Tax Commissioner. Notwithstanding any provision of this code to the
contrary, on or after July 1, 2010, reference to renewal of the
business registration certificate shall refer to the issuance of
a new business registration certificate pursuant to expiration,
cancellation or revocation of a prior business registration
certificate or to reinstatement of a business registration
certificate or to reinstatement of a business certificate
previously suspended by the Tax Commissioner.
Subject to the
exemptions, exceptions and requirements set forth in section
three of this article, on or after July 1, 2010, the business
registration certificate shall be issued upon payment of a tax of
$30 to the Tax Commissioner for new issuances of the business
registration certificate or for issuances of the business
registration certificate pursuant to expiration, cancellation or
revocation of a prior business registration certificate or for
reinstatement of a business registration certificate previously
suspended by the Tax Commissioner, along with any applicable
delinquent fees, interest, penalties and additions to tax.
Subject to the exemptions, exceptions and requirements set forth
in section three of this article, the $30 tax shall be paid each
and every time there is an issuance, reissuance or reinstatement
of a business registration certificate, along with any applicable
delinquent fees, interest, penalties and additions to tax.
(b)
Revocation or suspension of certificate. --
(1) The Tax Commissioner may cancel or suspend a business
registration certificate at any time during a registration period
if:
(A) The registrant filed an application for a business
registration certificate, or an application for renewal thereof,
that was false or fraudulent.
(B) The registrant willfully refused or neglected to file a
tax return or to report information required by the Tax
Commissioner for any tax imposed by or pursuant to this chapter.
(C) The registrant willfully refused or neglected to pay any
tax, additions to tax, penalties or interest, or any part
thereof, when they became due and payable under this chapter,
determined with regard to any authorized extension of time for
payment.
(D) The registrant neglected to pay over to the Tax
Commissioner on or before its due date, determined with regard to
any authorized extension of time for payment, any tax imposed by
this chapter which the registrant collects from any person and
holds in trust for this state.
(E) The registrant abused the privilege afforded to it by
article fifteen or fifteen-a of this chapter to be exempt from
payment of the taxes imposed by such articles on some or all of
the registrant's purchases for use in business upon issuing to
the vendor a properly executed exemption certificate, by failing
to timely pay use tax on taxable purchase for use in business or
by failing to either pay the tax or give a properly executed exemption certificate to the vendor.
(F) The registrant has failed to pay in full delinquent
personal property taxes owing for the calendar year.
(2) On or after July 1, 2010, a prospective registrant or a
former registrant for which a business registration certificate
has been suspended, cancelled or revoked pursuant to the
provisions of this article may apply for a new business
registration certificate or for reinstatement of a suspended
business registration certificate upon payment of all outstanding
delinquent fees, taxes, interest, additions to tax and penalties,
in addition to payment to the Tax Commissioner of a penalty in
the amount of $100. The Tax Commissioner may issue a new
business registration certificate or reinstate a suspended
business registration certificate if the prospective or former
registrant has provided security acceptable to and authorized by
the Tax Commissioner, payable to the Tax Commissioner, sufficient
to secure all delinquent fees, taxes, interest, additions to tax
and penalties owed by the prospective registrant. The Tax
Commissioner may issue a new business registration certificate or
reinstate a suspended business registration certificate if the
prospective or former registrant has entered into a payment plan
approved by the Tax Commissioner by which liability for all
delinquent fees, taxes, interest, additions to tax and penalties
will be paid in due course and without significant delay.
Failure of any registrant to comply with a payment plan pursuant
to this provision shall be grounds for immediate suspension or
revocation of the registrant's business registration certificate.
(3) On and after July 1, 2010, a prospective registrant or a
former registrant for which a business registration certificate
has been suspended, cancelled or revoked pursuant to the
provisions of any article of this code other than this article
may apply for a new business registration certificate or for
reinstatement of a suspended business registration certificate,
only if the prospective or former registrant has complied with
all applicable statutory and regulatory requirements for renewal,
issuance or reinstatement of the business registration
certificate and upon payment to the Tax Commissioner of a penalty
in the amount of $100.
(4) Except pursuant to exceptions specified in this code,
before canceling, revoking or suspending any business
registration certificate, the Tax Commissioner shall give written
notice of his or her intent to suspend, revoke or cancel the
business registration certificate of the taxpayer, the reason for
the suspension, revocation or cancellation, the effective date of
the cancellation, revocation or suspension and the date, time and
place where the taxpayer may appear and show cause why such
business registration certificate should not be canceled, revoked
or suspended. This written notice shall be served on the
taxpayer in the same manner as a notice of assessment is served
under article ten of this chapter, not less than twenty days prior to the effective date of the cancellation, revocation or
suspension. The taxpayer may appeal cancellation, revocation or
suspension of its business registration certificate in the same
manner as a notice of assessment is appealed under article ten-a
of this chapter. The filing of a petition for appeal does not
stay the effective date of the suspension, revocation or
cancellation. A stay may be granted only after a hearing is held
on a motion to stay filed by the registrant upon finding that
state revenues will not be jeopardized by the granting of the
stay. The Tax Commissioner may, in his or her discretion and
upon such terms as he or she may specify, agree to stay the
effective date of the cancellation, revocation or suspension
until another date certain.
(5) On or before July 1, 2005, the Tax Commissioner shall
propose for promulgation legislative rules establishing ancillary
procedures for the Tax Commissioner's suspension of business
registration certificates for failure to pay delinquent personal
property taxes pursuant to paragraph (F), subdivision (1) of this
section. The rules shall at a minimum establish any additional
requirements for the provision of notice deemed necessary by the
Tax Commissioner to meet requirements of law; establish protocols
for the communication and verification of information exchanged
between the Tax Commissioner, sheriffs and others; and establish
fees to be assessed against delinquent taxpayers that shall be
deposited into a special fund which is hereby created and
expended for general tax administration by the Tax Division of
the Department of Revenue and for operation of the Tax Division.
Upon authorization of the Legislature, the rules shall have the
same force and effect as if set forth herein. No provision of
this subdivision may be construed to restrict in any manner the
authority of the Tax Commissioner to suspend such certificates
for failure to pay delinquent personal property taxes under
paragraph (C) or (F), subdivision (1) of this section or under
any other provision of this code prior to the authorization of
the rules.
(c)
Refusal to renew. --The Tax Commissioner may refuse to
issue or renew a business registration certificate if the
registrant is delinquent in the payment of any tax administered
by the Tax Commissioner under article ten of this chapter or the
corporate license tax imposed by article twelve-c of this
chapter, until the registrant pays in full all the delinquent
taxes including interest and applicable additions to tax and
penalties. In his or her discretion and upon terms as he or she
specifies, the Tax Commissioner may enter into an installment
payment agreement with the taxpayer in lieu of the complete
payment. Failure of the taxpayer to fully comply with the terms
of the installment payment agreement shall render the amount
remaining due thereunder immediately due and payable and the Tax
Commissioner may suspend or cancel the business registration
certificate in the manner provided in this section.
(d)
Refusal to renew due to delinquent personal property
tax. -- The Tax Commissioner shall refuse to issue or renew a
business registration certificate when informed in writing,
signed by the county sheriff, that personal property owned by the
applicant and used in conjunction with the business activity of
the applicant is subject to delinquent property taxes. The Tax
Commissioner shall forthwith notify the applicant that the
commissioner will not act upon the application until information
is provided evidencing that the taxes due are either exonerated
or paid.
(e)
Refusal to issue, revocation, suspension and refusal to
renew business registration certificate of alter ego, nominee or
instrumentality of a business that has previously been the
subject of a lawful refusal to issue, revocation, suspension or
refuse to renew. --
(1) The Tax Commissioner may refuse to issue a business
registration certificate, or may revoke a business registration
certificate or may suspend a business registration certificate or
may refuse to renew a business registration certificate for any
business determined by the Tax Commissioner to be an alter ego,
nominee or instrumentality of a business that has previously been
the subject of a lawful refusal to issue a business registration
certificate or of a lawful revocation, suspension or refusal to
renew a business registration certificate pursuant to this
section, and for which the business registration certificate has
not been lawfully reinstated or reissued.
(2) For purposes of this section, a business is presumed to
be an alter ego, nominee or instrumentality of another business
or other businesses if:
(A) More than twenty percent of the real assets or more than
twenty percent of the operating assets or more than twenty
percent of the tangible personal property of one business are or
have been transferred to the other business or businesses, or are
or have been used in the operations of the other business or
businesses, or more than twenty percent of the real assets or
more than twenty percent of the operating assets or more than
twenty percent of the tangible personal property of one business
are or have been used to collateralize or secure debts or
obligations of the other business or businesses;
(B) Ownership of the businesses is so configured that the
attribution rules of either Internal Revenue Code section 267 or
Internal Revenue Code section 318 would apply to cause ownership
of the businesses to be attributed to the same person or entity;
or
(C) Substantive control of the businesses is held or
retained by the same person, entity or individual, directly or
indirectly, or through attribution under paragraph (B) of this
subdivision.
NOTE: The purpose of this bill is to clarify that the West
Virginia Code §11-12-3 requirements, exemptions and exceptions
apply with relation to the business registration tax and business
registration certificate, and to clarify that, subject to the
requirements, exemptions and exceptions of West Virginia Code
§11-12-3, the tax is imposed for each and every issuance,
reissuance or reinstatement of a business registration
certificate.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
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