H. B. 3099
(By Delegates Swartzmiller, Michael,
Varner, Ennis and Mezzatesta)
[Introduced March 29, 2001; referred to the
Committee on Finance.]
A BILL to amend chapter eleven of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, by adding
thereto a new article, designated article twenty-eight,
relating to allowing a tobacco access control tax credit
against the personal income tax, the corporate net income tax
and the business franchise tax.
Be it enacted by the Legislature of West Virginia:
That chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, be amended by adding thereto
a new article, designated article twenty-eight, to read as follows:
ARTICLE 28. TOBACCO ACCESS CONTROL TAX CREDIT.
§11-28-1. Short title.
This article may be known and cited as the "Tobacco Access
Control Tax Credit Act."
§11-28-2. Definitions.
The following words and phrases when used in this article have
the meanings given to them in this section unless the context
clearly indicates otherwise:
(1) "Division" means the tax division of the department of tax
and revenue.
(2) "Qualified tax liability" means the liability for taxes
imposed under article twenty-one, twenty-three or twenty-four of
this chapter.
(3) "Qualified tobacco access control expense" means that
expense incurred by a taxpayer for the purchase and use of
technology intended to control the access of minors to cigarettes
and which is capable of:
(A) Capturing the information from a bar code or magnetic
strip on a driver's license or identification card issued by the
division of motor vehicles;
(B) Producing a declaration of age in print form and storing
a record of the event in memory;
(C) Producing an audible, visual and printed result;
(D) Reporting a history of the events, including the ability
to transfer the data for archiving and data base development
purposes; and
(E) Storing at least one thousand events at any time before
data is transferred.
(4) "Taxpayer" means an entity licensed by the division to sell cigarettes to a consumer.
(5) "Tobacco access control tax credit" means the credit
provided under this article.
§11-28-3. Credit for tobacco access control expenses.
(a)
Application for credit by taxpayer. -- A taxpayer who
incurs a qualified tobacco access control expense in a taxable year
may apply for a tobacco access control tax credit as provided in
this article. In order to receive the credit, the taxpayer must
submit an application to the division by the fifteenth day of
September for a qualified tobacco access control expense incurred
in the taxable year that ended in the prior calendar year.
(b)
Amount of credit. -- A taxpayer that timely applies under
subsection (a) of this section shall receive a tobacco access
control tax credit for the taxable year up to the amount of nine
hundred dollars per license per location.
(c)
Notification of approval from division. -- By the
fifteenth day of December of the calendar year following the close
of the taxable year during which the qualified tobacco access
control expense was incurred, the division shall notify the
taxpayer of the amount of the taxpayer's tobacco access control tax
credit approved by the division.
§11-28-4. Use of credit.
(a)
Carryover. --
(1) The amount of the tobacco access control tax credit that a taxpayer may use against any one qualified tax liability during
any year may not exceed fifty percent of the qualified tax
liability for that taxable year.
(2) If the taxpayer cannot use the entire amount of the
tobacco access control tax credit for the taxable year in which the
tobacco access control tax credit is first approved, then the
excess may be carried over to succeeding taxable years and used as
a credit against the qualified tax liability of the taxpayer for
those taxable years.
(3) Each time that the tobacco access control tax credit is
carried over to a succeeding taxable year, it shall be reduced by
the amount that was used as a credit during the immediately
preceding taxable year.
(4) The tobacco access control tax credit provided by this
article may be carried over and applied to succeeding taxable years
for not more than four taxable years following the first taxable
year for which the taxpayer was entitled to claim the credit.
(b)
Taxable year to which applied. -- A tobacco access control
tax credit approved by the division for qualified tobacco access
control expense in a taxable year first shall be applied against
the taxpayer's qualified tax liability for the current taxable year
as of the date on which the credit was approved before the tobacco
access control tax credit is applied against any tax liability
under subsection (a) of this section.
(c)
Limitations. -- A taxpayer may not carry back, obtain a
refund of or assign an unused tobacco access control tax credit.
§11-28-5. Determination of qualified tobacco access control
expenses.
In prescribing standards for determining which tobacco access
control expense is a qualified tobacco access control expense for
purposes of computing the credit provided by this article, the
division shall require:
(1) A copy of the technology specifications demonstrating that
the specifications meet the definition of a qualified tobacco
access control expense;
(2) A copy of an invoice to the taxpayer for the technology
purchased for qualification as a qualified tobacco access control
expense; and
(3) A copy of the check or checks and paid receipts for
technology purchased for qualifications as qualified tobacco access
control expense.
§11-28-6. Time limitation.
A taxpayer is not entitled to a tobacco access control tax
credit for qualified tobacco access control expenses incurred in
taxable years ending after the thirty-first day of December, two
thousand five.
§11-28-7. Limitation on credits.
The total amount of credits approved by the division may not exceed twenty million dollars.
§11-28-8. S Corporation shareholder pass-through.
(a)
General rule. -- If a West Virginia S corporation does not
have an eligible tax liability against which the tobacco access
control tax credit may be applied, a shareholder of the West
Virginia S corporation is entitled to a tobacco access control tax
credit equal to the tobacco access control tax credit determined
for the West Virginia S corporation for the taxable year multiplied
by the percentage of the West Virginia S corporation's distributive
income to which the shareholder is entitled.
(b)
Double use of credit prohibited. -- A West Virginia S
corporation and a shareholder of a West Virginia S corporation may
not claim a credit under this article for the same qualified
tobacco access control expense.
§11-28-9. Report to Legislature.
The commissioner shall submit an annual report to the joint
committee government and finance, by filing it with the legislative
librarian, indicating the effectiveness of the credit provided by
this article not later than the fifteenth day of March following
the year in which the credits are approved. The report shall
include the number of taxpayers using the credit as of the date of
the report and the amount of credits approved and used. The report
may also include any recommendations for changes in the calculation
or administration of the credit.
§11-28-10. Expiration.
The division may not approve a tobacco access control tax
credit under this article for taxable years ending after the
thirty-first day of December, two thousand five.
§11-28-11. Rules.
The commissioner shall propose rules for legislative approval
in accordance with the provisions of article three, chapter
twenty-nine-a of this code necessary for the implementation and
administration of this article.
NOTE: The purpose of this bill is to
allow a tobacco access
control tax credit against the personal income tax, the corporate
net income tax and the business franchise tax, to off-set expenses
incurred by a taxpayer for the purchase and use of technology
intended to control the access of minors to cigarettes.
This article is new; therefore, strike-throughs and
underscoring have been omitted.
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