H. B. 4357
(By Delegates Doyle, Tabb, Michael,
Manual, Stalnaker, Campbell and Duke)
[Introduced February 9, 2004; referred to the
Committee on Political Subdivisions then Finance.]
A BILL to amend the code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §8-13-5b; and to
amend said code by adding thereto a new section, designated
§11-10-11b, all relating to authorizing municipalities to
impose an alternative one percent municipal sales and service
tax on the privilege of selling tangible personal property or
custom software and for the privilege of furnishing certain
select services in the municipality in lieu of imposing a
business and occupation tax.
Be it enacted by the Legislature of West Virginia:
That the code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §8-13-5b; and that said
code be amended by adding thereto a new section, designated
§11-10-11b, all to read as follows:
CHAPTER 8. MUNICIPAL CORPORATIONS.
ARTICLE 13. TAXATION AND FINANCE.
§8-13-5b. Alternative municipal sales and service tax.
(a)
Authorization to impose tax. -- In lieu of imposing the
tax authorized by section five of this article, the governing body
of any municipality may, by ordinance, impose an alternative
municipal sales and service tax on the privilege of selling
tangible personal property or custom software and for the privilege
of furnishing certain select services in the municipality in
accordance with this section for the use of the municipality.
(b)
Tax base. -- (1) The base of an alternative municipal
sales and service tax imposed pursuant to this section shall be
identical to the base of the consumers sales and service tax
imposed pursuant to article fifteen, chapter eleven of this code on
sales made and services rendered within the boundaries of the
municipality:
Provided, That all exemptions and exceptions from
the consumers sales and service tax shall also apply to the
alternative municipal sales and service tax and sales of gasoline
and special fuel shall not be subject to special district excise
tax but shall remain subject to the tax levied by article fifteen,
chapter eleven of this code.
(2) The alternative municipal sales and service tax shall be
imposed in addition to the consumers sales and service tax imposed
pursuant to article fifteen, chapter eleven of this code on sales made and services rendered within the boundaries of the
municipality and, except as exempted or excepted, all sales made
and services rendered within the boundaries of the municipality
shall remain subject to the tax levied by said article.
(3) The alternative municipal sales and service tax shall be
imposed in addition to any tax imposed pursuant to section one,
article eighteen, chapter seven of this code, section six, article
thirteen of this article, and section twelve, article thirty-eight
of this article.
(4) The municipality may not impose a tax pursuant to section
five-a, article thirteen of this chapter upon any activity upon
which a provision of law requires or results in the imposition of
an alternative municipal sales and service tax upon that activity.
(c)
Tax rate. -- The rate of an alternative municipal sales
and service tax levied pursuant to this section shall be stated in
an ordinance enacted by the municipality and shall be at the rate
of one cent on each dollar of gross proceeds from sales of tangible
personal property and services subject to the tax. The tax on
fractional parts of a dollar shall be levied and collected in
conformity with the provision of section three, article fifteen,
chapter eleven of this code.
(d)
Transaction sourcing rules. -- The ordinance of the
municipality imposing an alternative municipal sales and service
tax shall provide that sales and services subject to the tax shall be sourced in accordance with the provisions of article fifteen-b
of this chapter, including, but not limited to, sections fourteen,
fifteen, sixteen, seventeen and eighteen thereof.
(e)
Collection by tax commissioner. -- The ordinance of the
municipality imposing an alternative municipal sales and service
tax shall provide for the tax to be collected by the tax
commissioner in the same manner as the tax levied by section three,
article fifteen, chapter eleven of this code is administered,
assessed, collected and enforced.
(f)
Notice to tax commissioner. -- Within ten days following
the effective date of any amendment or change to the boundary of a
municipality imposing an alternative municipal sales and service
tax, the municipality shall provide written notice of any change to
the boundary of the municipality to the tax commissioner in detail
and form required by the commissioner for inclusion in the database
required under section thirty-five, article fifteen-b, chapter
eleven of this code.
(g)
Deposit of net tax collected. -- The ordinance of the
municipality imposing an alternative municipal sales and service
tax shall provide that the tax commissioner deposit the net amount
of tax collected in the alternative municipal sales and service tax
fund to the credit of the municipality's subaccount therein and
that the money in the subaccount may only be used for the purposes
for which the tax authorized by section five of this article may be used.
(h)
Establishment of the alternative municipal sales and
service tax fund. --(1) There is hereby created a special revenue
account in the state treasury designated the "alternative municipal
sales and service tax fund" which is an interest-bearing account
and shall be invested in the manner described in section nine-c,
article six, chapter twelve of this code with the interest and
other return earned thereon a proper credit to the fund.
(i) A separate and segregated subaccount within the account
shall be established for each municipality that imposes an
alternative municipal sales and service tax pursuant to this
section. In addition to the alternative municipal sales and
service tax levied and collected as provided in this section, funds
paid into the account for the credit of any subaccount may also be
derived from the following sources:
(1) All interest or return on the investment accruing to the
subaccount; and
(2) Any gifts, grants, bequests, transfers, appropriations or
donations which are received from any governmental entity or unit
or any person, firm, foundation or corporation.
(j)
Effective date of alternative municipal sales and service
tax. -- Any taxes imposed pursuant to the authority of this section
shall be effective on the first day of the calendar month that
begins at least sixty days after the date of enactment of the ordinance imposing the tax or at any later date expressly
designated in the ordinance that begins on the first day of a
calendar month.
(k)
Copies of ordinance. -- Upon enactment of an ordinance
levying an alternative municipal sales and service tax, a certified
copy of the ordinance shall be mailed to the state auditor, as ex
officio the chief inspector and supervisor of public offices, the
state treasurer and the tax commissioner.
(l)
Limited authority to impose tax. -- (1) Notwithstanding
any other provision of this code to the contrary, no county, board,
political subdivision or any other agency or entity other than a
municipality that meets the requirements of this section may impose
the tax authorized by this section.
(2) No subsequent amendment to this code shall supersede the
provisions of subdivision (1) of this subsection unless the
amendment specifically states that the provisions of subdivision
(1) of this subsection are superseded.
CHAPTER 11. TAXATION.
ARTICLE 10. PROCEDURE AND ADMINISTRATION.
§11-10-11b. Administration of alternative municipal sales and
service tax; commission authorized
.
(a)(1) Any municipality which, pursuant to section five-b,
article thirteen, chapter eight of this code imposes an alternative municipal sales and service tax shall, by express
provision in the ordinance imposing that tax, authorize the state
tax commissioner to administer, assess, collect and enforce that
tax on behalf of and as its agent.
(2) The municipality shall make such authorization by the
adoption of a provision in its ordinance levying an alternative
municipal sales and service tax stating its purpose and referring
to this section and providing that the ordinance shall be effective
on the first day of a month at least sixty days after its adoption.
(3) A certified copy of the ordinance shall be forwarded to
the state auditor, the state treasurer and the tax commissioner so
that it will be received within five days after its adoption or
enactment.
(b) Any alternative municipal sales and service tax
administered under this section shall be administered and collected
by the tax commissioner in the same manner and subject to the same
interest, additions to tax and penalties as provided for the tax
imposed in article fifteen of this chapter.
(c) All alternative municipal sales and service tax moneys
collected by the tax commissioner under this section shall be paid
into the state treasury to the credit of each municipality's
subaccount in the alternative municipal sales and service tax fund
created pursuant to section five-b, article thirteen, chapter eight
of this code. The alternative municipal sales and service tax moneys shall be credited to the subaccount of each particular
municipality levying an alternative municipal sales and service tax
being administered under this section. The credit shall be made to
the subaccount of the municipality in which the taxable sales were
made and services rendered as shown by the records of the tax
commissioner and certified by him or her monthly to the state
treasurer, namely, the location of each place of business of every
vendor collecting and paying the tax to the tax commissioner
without regard to the place of possible use by the purchaser.
(d) (1) As soon as practicable after the alternative municipal
sales and service tax moneys have been paid into the state treasury
in any month for the preceding reporting period, the municipality
may issue a requisition to the auditor requesting issuance of a
state warrant for the proper amount in favor of the municipality
entitled to the monthly remittance of its alternative municipal
sales and service tax moneys.
(2) Upon receipt of the requisition, the auditor shall issue
his or her warrant on the state treasurer for the funds requested
and the state treasurer shall pay the warrant out of the
subaccount.
(3) If errors are made in any payment, or adjustments are
otherwise necessary, whether attributable to refunds to taxpayers
or to some other fact, the errors shall be corrected and
adjustments made in the payments for the next six months as follows: One sixth of the total adjustment shall be included in
the payments for the next six months. In addition, the payment
shall include a refund of amounts erroneously not paid to the
municipality and not previously remitted during the three years
preceding the discovery of the error.
(4) A correction and adjustment in payments described in this
subsection due to the misallocation of funds by the vendor shall be
made within three years of the date of the payment error.
(e) Notwithstanding any other provision of this code to the
contrary, the tax commissioner shall deduct and retain for the
benefit of his or her office for expenditure pursuant to
appropriation of the Legislature from each payment into the state
treasury, as provided in subsection (c) of this section, one
percent thereof as a commission to compensate his or her office for
the discharge of the duties described in this section.
Note: The purpose of this bill is to permit municipalities to
impose an alternative 1% municipal sales and service tax in the
municipality in lieu of imposing the business and occupation tax
currently permitted by law.
§8-13-5b and §11-10-11b are new; therefore, strike-throughs
and underscoring have been omitted.