H. B. 2270
(By Delegates Kiss (By Request), Rowe, Mezzatesta, J. Martin,
Staton, Ashley and Faircloth)
(Originating in the House Committee on Finance.)
[February 27, 1995]
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 six-c, relating to
establishing a special method for appraising, assessing and
collecting personal property tax; establishing a method for
determining market value of dealer vehicle inventory for
personal property tax purposes; reporting market value;
setting forth a definition; setting forth legislative intent;
and providing for promulgation of a legislative rule.
Be it enacted by the Legislature of West Virginia:
That chapter eleven of the code of West Virginia, as amended,
be amended by adding thereto a new article, designated article six-
c, to read as follows:
ARTICLE 6C. SPECIAL METHOD FOR APPRAISING DEALER VEHICLE
§11-6C-1. Inventory included within scope of article.
Notwithstanding any other provisions of this code, inventory
of vehicles, as that term is defined in section one, article one,
chapter seventeen-b of this code, that is held for sale or lease by
new or used vehicle dealers licensed under the provisions of
article six, chapter seventeen-a of this code and that consists of
individual units of personal new or used property, each unit of
which, upon its sale to a retail purchaser must, as a matter of
law, be titled in the name of the retail purchaser and be
registered with the division of motor vehicles, shall be appraised
for assessment purposes, as set forth in this article.
This article does not apply to units of inventory which are
included in fleet sales, included in transactions between dealers
or classified as heavy duty trucks of sixteen thousand pounds or
more gross vehicular weight. For purposes of this article,
inventory subject to the provisions of this article shall be
denoted "dealer vehicle inventory."
§11-6C-2. Method for determining market value of dealer vehicle
For purposes of appraisal, the market value of dealer vehicle inventory, as of the first day of July of each year, for any dealer
in business during the entire preceding twelve-month period, shall
be the total annual sales of such inventory made by such dealer
during the preceding twelve-month period, divided by twelve. For
the purposes of this article, "gross sales" or "total annual sales"
means the amount received in money, credits, property, services or
other consideration from sales within this state without deduction
on account of the cost of the property sold, amounts paid for
interest or any other expenses whatsoever. Gross sales or total
annual sales shall not be reduced by the value of an item of
tangible personal property which is traded-in for the purpose of
reducing the purchase price of the item purchased. In the case of
dealers who were not in business during the entire twelve-month
period immediately preceding the first day of July, the assessor
shall estimate the market value of such inventory based on data as
may be available to him or her: Provided, That the assessor may
extrapolate estimates using such sales data which may be available
and reliable when sales are made for a period of three months or
more during the prior twelve-month period. In any case, there
shall be excluded from the appraisal calculations the value of
those units which were not physically held as inventory by the
owner of the inventory at any time during the preceding twelve-month period. In all cases, the market value, so derived, shall
serve as the basis for calculating the appraised value.
§11-6C-3. Owner to file return estimating market value.
The owner of dealer vehicle inventory shall report the market
value of such inventory, derived as set forth in section two of
this article, to the assessor, as a part of the return required by
law to be filed annually pursuant to the provisions of this
§11-6C-4. Determination of tax on dealer vehicle inventory.
The annual amount of tax levied upon the dealer vehicle
inventory pursuant to article eight of this chapter shall be based
upon the market value, determined pursuant to this article, times
the assessment percentage then provided by law.
§11-6C-5. Intent of this article; tax commissioner to promulgate
(a) This article is adopted to address the lack of
uniformity, audit difficulties and business management issues
arising in this state with respect to the assessment of personal
property held as new and used dealer vehicle inventory.
Accordingly, the legislature finds that the adoption of this
article will: (1) provide a more reliable and uniform method of
determining market value of dealer vehicle inventory; (2) minimize audit difficulties associated with such property; (3) provide a
predictable revenue stream for levying bodies; (4) maximize the
owner's ability to manage inventory; and (5) provide clear guidance
to local authorities by superseding the wide variety of otherwise
lawful appraisal methods now in use in West Virginia.
(b) The tax commissioner shall have the power to promulgate
legislative rules in accordance with the provisions of chapter
twenty-nine-a of this code as may be necessary to implement the
provisions of this article.