ENROLLED

Senate Bill No. 37

(By Senators Craigo, Scott and Plymale)

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[Passed March 15, 1996; in effect ninety days from passage.]

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AN ACT to repeal sections nine-b and nine-c, article fifteen, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended; to repeal sections three-b and three-c, article fifteen-a of said chapter; to amend and reenact sections two and five, article fourteen of said chapter; to further amend said article by adding thereto three new sections, designated sections seventeen, seventeen-a and eighteen; and to amend and reenact section nine, article fifteen of said chapter, all relating generally to exemptions from excise taxes and compliance with those taxes; removing the gasoline and special fuels excise tax on special dyed diesel fuels used in off-highway equipment; prohibiting the operation of motor vehicles upon the highways of this state with special dyed diesel fuel as a fuel and carried in the fuel tanks; providing for spot check inspections and where such inspections may occur; setting forth who may make these inspections; setting forth civil and criminal penalties; sales tax; exemptions from sales tax; specifying effective dates; creating exemptions from the consumers sales and service tax for services performed by a corporation, partnership or limited liability company for a related corporation, partnership or limited liability company; exempting sales by public and academic libraries; exempting sales of primary opinion research services performed for out of state clients; exempting certain purchases by persons making value added agricultural products; exempting sales of musical instructional services by music teachers; exempting charges to members for membership, newsletters, seminars and instructional materials related thereto for members of certain membership organizations which are tax exempt under specified sections of the Internal Revenue Code; repealing separate sections relating to how exemptions from tax are asserted and incorporating these requirements in the section providing the exemptions from tax; exempting commissions received by manufacturers' representatives and numbering the exemptions from sales tax; and specifying effective dates for such exemptions.

Be it enacted by the Legislature of West Virginia:
That sections nine-c and nine-d, article fifteen, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be repealed; that sections three-b and three-c, article fifteen-a of said chapter be repealed; that sections two and five, article fourteen of said chapter be amended and reenacted; that said article be further amended by adding thereto three new sections, designated sections seventeen, seventeen-a and eighteen; and that section nine, article fifteen of said chapter be amended and reenacted, all to read as follows:
ARTICLE 14. GASOLINE AND SPECIAL FUEL EXCISE TAX.
§11-14-2. Definitions.
For purposes of this article:
(1) "Actual metered gallons" means, in addition to amounts computed by mechanical devices which measure and record directly in digital terms, all amounts computed by other methods of computing quantities commonly employed by persons engaged in the sale of petroleum products, including, but not limited to, tank or barge strappings and other graduated lineal devices.
(2) "Aircraft fuel" means gasoline and special fuel suitable for use in any aircraft engine.
(3) "Commissioner" or "tax commissioner" means the tax commissioner of the state of West Virginia or his or her duly authorized agent.
(4) "Distributor" or "producer" means and includes every person:
(a) Who produces, manufactures, processes or otherwise alters gasoline or special fuel in this state for use or for sale;
(b) Who engages in this state in the sale of gasoline or special fuel for the purpose of resale or for distribution; or
(c) Who receives gasoline or special fuel into the cargo tank of a tank wagon in this state for use or sale by such person.
(5) "Gallon" means two hundred thirty-one cubic inches of liquid measurement, by volume: Provided, That the commissioner may by rule prescribe other measurement or definition of gallon.
(6) "Gasoline" means any product commonly or commercially known as gasoline, regardless of classification, suitable for use as fuel in an internal combustion engine, except special fuel as defined in this section.
(7) "Highway" means every way or place of whatever nature open to the use of the public as a matter of right for the purpose of vehicular travel, which is maintained by this state or some taxing subdivision or unit of this state or the federal government or any of its agencies.
(8) "Importer" means every person, resident or nonresident, other than a distributor, who receives gasoline or special fuel outside this state for use, sale or consumption within this state, but shall not include the fuel in the supply tank of a motor vehicle, or a person paying the motor carrier road tax as provided for in article fourteen-a of this chapter.
(9) "Motor carrier" means any passenger vehicle which has seats for more than nine passengers in addition to the driver, or any road tractor, or any tractor truck or any truck having more than two axles which is operated or caused to be operated by any person on any highway in this state.
(10) "Motor vehicle" means automobiles, motor carriers, motor trucks, motorcycles and all other vehicles or equipment, engines or machines which are operated or propelled by combustion of gasoline or special fuel.
(11) "Person" means and includes any individual, firm, partnership, limited partnership, joint venture, association, company, corporation, organization, syndicate, receiver, trust or any other group or combination acting as a unit, in the plural as well as the singular number, and means and includes the officers, directors, trustees or members of any firm, partnership, limited partnership, joint venture, association, company, corporation, organization, syndicate, receiver, trust or any other group or combination acting as a unit, in the plural as well as the singular number, unless the intention to give a more limited meaning is disclosed by the context.
(12) "Petroleum carrier" means any person who hauls or transports gasoline or special fuel within this state or on any navigable rivers which are within the jurisdiction of this state.
(13) "Purchase" means and includes any acquisition of ownership of property or of a security interest for a consideration.
(14) "Receive" means any acquisition of ownership or possession of gasoline or special fuel.
(15) "Retail dealer" means any person not a distributor or producer who sells gasoline or special fuel from a fixed location in this state to users.
(16) "Sale" means any transfer, exchange, gift, barter or other disposition of any property or security interest for a consideration.
(17) "Special fuel" means any gas or liquid, other than gasoline, used or suitable for use as fuel in an internal combustion engine. The term "special fuel" includes products commonly known as natural or casinghead gasoline, but shall not include any petroleum product or chemical compound such as alcohol, industrial solvent, heavy furnace oil, lubricant, etc., not commonly used nor practicably suited for use as fuel in an internal combustion engine.
(18) "Special dyed diesel fuel" means diesel fuel that is required to be dyed under United States environmental protection agency rules for high sulphur diesel fuel or is dyed under internal revenue service rules for low sulphur fuel or pursuant to any other requirements subsequently set by the United States environmental protection agency or internal revenue service including any invisible marker requirements that is sold for the exclusive use or consumption in off-highway equipment and is exempt from excise taxation under federal law.
(19) "Supply tank" means any receptacle on a motor vehicle from which gasoline or special fuel is supplied for the propulsion of the vehicle or equipment located thereon, exclusive of a cargo tank. A supply tank includes a separate compartment of a cargo tank used as a supply tank, and any auxiliary tank or receptacle of any kind from which gasoline or special fuel is supplied for the propulsion of the vehicle, whether or not the tank or receptacle is directly connected to the fuel supply line of the vehicle.
(20) "Tank wagon" means and includes any motor vehicle or vessel with a cargo tank or cargo tanks ordinarily used for making deliveries of gasoline or special fuel or both for sale or use.
(21) "Tax" includes, within its meaning, interest, additions to tax and penalties, unless the intention to give it a more limited meaning is disclosed by the context.
(22) "Taxpayer" means any person liable for any tax, interest, additions to tax or penalty under the provisions of this article.
(23) "User" means any person who purchases gasoline or special fuel for use as fuel and uses the fuel in an internal combustion engine owned or operated by that person.
§11-14-5. Exemptions from tax.
There shall be exempted from the excise tax on gasoline or special fuel imposed by this article the following:
(1) All gallons of gasoline or special fuel exported from this state to any other state or nation;
(2) All gallons of gasoline or special fuel sold to and purchased by the United States or any agency of the United States when delivered in bulk quantities of five hundred gallons or more;
(3) All gallons of gasoline or special fuel sold to and purchased by a county board of education when delivered in bulk quantities of five hundred gallons or more;
(4) All gallons of gasoline or special fuel sold pursuant to a government contract, in bulk quantities of five hundred gallons or more, for use in conjunction with any municipal, county, state or federal civil defense or emergency service program, or to any person on whom is imposed a requirement to maintain an inventory of gasoline or special fuel for the purpose of the program: Provided, That fueling facilities used for these purposes are not capable of fueling motor vehicles and the person in charge of the program has in his or her possession a letter of authority from the tax commissioner certifying his or her right to the exemption;
(5) All gallons of gasoline or special fuel imported into this state in the fuel supply tank or tanks of a motor vehicle, other than in the fuel supply tank of a vehicle being hauled. This exemption does not relieve a person owning or operating as a motor carrier of any taxes imposed by article fourteen-a of this chapter;
(6) All gallons of gasoline and special fuel used and consumed in stationary off-highway turbine engines;
(7) All gallons of special fuel for heating any public or private dwelling, building or other premises;
(8) All gallons of special fuel for boilers;
(9) All gallons of gasoline or special fuel used as a dry cleaning solvent or commercial or industrial solvent;
(10) All gallons of gasoline or special fuel used as lubricants, ingredients or components of any manufactured product or compound;
(11) All gallons of gasoline or special fuel sold to any municipality or agency of a municipality for use in vehicles or equipment owned and operated by the municipality or agency of a municipality and when purchased for delivery in bulk quantities of five hundred gallons or more;
(12) All gallons of gasoline or special fuel sold to any urban mass transportation authority, created pursuant to the provisions of article twenty-seven, chapter eight of this code, for use in an urban mass transportation system;
(13) All gallons of gasoline or special fuel sold for use as aircraft fuel;
(14) All gallons of gasoline or special fuel sold for use or used as a fuel for commercial watercraft;
(15) All gallons of special fuel sold for use or consumed in railroad diesel locomotives;
(16) All gallons of gasoline or special fuel sold to and purchased by a unit of county government when delivered in bulk quantities of five hundred gallons or more; and
(17) All gallons of special dyed diesel fuel.
§11-14-17. No dyed fuel on highways.
No person may operate or maintain a motor vehicle on any public highway in this state with special dyed diesel fuel as the motor fuel contained in the fuel supply tank. This provision does not apply to: (a) Persons operating motor vehicles that have received fuel into their fuel tanks outside of this state in a jurisdiction that permits introduction of dyed taxable motor fuel of that color and type into the motor fuel tank of highway vehicles, and can show proof of such; or (b) uses of dyed fuel on the highway which are lawful under the Internal Revenue Code and regulations under that code, including state and local government vehicles and buses unless otherwise prohibited by this chapter.
Any person who violates this section is guilty of a misdemeanor and upon conviction thereof, shall be fined ten dollars per gallon of fuel capacity of the fuel tanks or one thousand dollars, whichever is greater, for the first two violations of this section in a calendar year, and a fine of fifteen dollars per gallon of fuel capacity of the fuel tanks or two thousand dollars, whichever is greater, for each subsequent offense in the same calendar year.
§11-14-17a. Spot check inspections.
(a) The tax commissioner or his or her appointees, may stop, inspect and issue citations to operators of motor vehicles for violations of this chapter at sites where fuel is, or may be, produced, stored, or loaded into or consumed by motor vehicles. These sites include, but are not limited to:
(1) A terminal;
(2) A fuel storage facility that is not a terminal, such as a bulk storage facility;
(3) A retail fuel facility;
(4) Highway rest stops; or
(5) A designated inspection area, including any state highway inspection station, weigh station, agricultural inspection station, mobile station or other location designated by the tax commissioner.
(b) Nothing contained in this section may be construed to prohibit the issuance of a citation for the violation of the provisions of this article on the open highway or other than the spot check areas where the violation of this article is discovered where the motor vehicle is lawfully stopped for any other criminal violation of the laws of this state.
§11-14-18. Penalty for refusal to permit inspection.
Any person who refuses to permit the inspection authorized by section seventeen-a of this article is guilty of a violation of the rules of the state tax division and shall pay a civil penalty of five thousand dollars, in addition to any other penalty imposed in this code.
ARTICLE 15. CONSUMERS SALES TAX.
§11-15-9. Exemptions.
(a) Exemptions for which exemption certificate may be issued. -- A person having a right or claim to any exemption set forth in this subsection may, in lieu of paying the tax imposed by this article and filing a claim for refund, execute a certificate of exemption, in such form as the tax commissioner may require, and deliver it to the vendor of the property or service, in such manner as the tax commissioner may require. However, the tax commissioner may, by rule, specify those exemptions authorized in this subsection for which exemptions certificates are not required. The following sales of tangible personal property and/or services are exempt as provided in this subsection:
(1) Sales of gas, steam and water delivered to consumers through mains or pipes and sales of electricity;
(2) Sales of textbooks required to be used in any of the schools of this state or in any institution in this state which qualifies as a nonprofit or educational institution subject to the West Virginia department of education and the arts, the board of trustees of the university system of West Virginia or the board of directors for colleges located in this state;
(3) Sales of property or services to this state, its institutions or subdivisions, governmental units, institutions or subdivisions of other states: Provided, That the law of the other state provides the same exemption to governmental units or subdivisions of this state and to the United States, including agencies of federal, state or local governments for distribution in public welfare or relief work;
(4) Sales of vehicles which are titled by the division of motor vehicles and which are subject to the tax imposed by section four, article three, chapter seventeen-a of this code, or like tax;
(5) Sales of property or services to churches who make no charge whatsoever for the services they render: Provided, That the exemption granted in this subdivision applies only to services, equipment, supplies, food for meals and materials directly used or consumed by these organizations, and shall not apply to purchases of gasoline or special fuel;
(6) Sales of tangible personal property or services to a corporation or organization which has a current registration certificate issued under article twelve of this chapter, is exempt from federal income taxes under Section 501(c)(3) or (c)(4) of the Internal Revenue Code of 1986, as amended, and is:
(A) A church or a convention or association of churches as defined in Section 170 of the Internal Revenue Code of 1986, as amended;
(B) An elementary or secondary school which maintains a regular faculty and curriculum and has a regularly enrolled body of pupils or students in attendance at the place in this state where its educational activities are regularly carried on;
(C) A corporation or organization which annually receives more than one half of its support from any combination of gifts, grants, direct or indirect charitable contributions or membership fees;
(D) An organization which has no paid employees and its gross income from fund raisers, less reasonable and necessary expenses incurred to raise the gross income (or the tangible personal property or services purchased with the net income), is donated to an organization which is exempt from income taxes under Section 501(c)(3) or (c)(4) of the Internal Revenue Code of 1986, as amended;
(E) A youth organization, such as the girl scouts of the United States of America, the boy scouts of America or the YMCA Indian guide/princess program and the local affiliates thereof, which is organized and operated exclusively for charitable purposes and has as its primary purpose the nonsectarian character development and citizenship training of its members;
(F) For purposes of this subsection:
(i) The term "support" includes, but is not limited to:
(I) Gifts, grants, contributions or membership fees;
(II) Gross receipts from fund raisers which include receipts from admissions, sales of merchandise, performance of services or furnishing of facilities in any activity which is not an unrelated trade or business within the meaning of Section 513 of the Internal Revenue Code of 1986, as amended;
(III) Net income from unrelated business activities, whether or not such activities are carried on regularly as a trade or business;
(IV) Gross investment income as defined in Section 509(e) of the Internal Revenue Code of 1986, as amended;
(V) Tax revenues levied for the benefit of a corporation or organization either paid to or expended on behalf of the organization; and
(VI) The value of services or facilities (exclusive of services or facilities generally furnished to the public without charge) furnished by a governmental unit referred to in Section 170(c)(1) of the Internal Revenue Code of 1986, as amended, to an organization without charge. This term does not include any gain from the sale or other disposition of property which would be considered as gain from the sale or exchange of a capital asset, or the value of an exemption from any federal, state or local tax or any similar benefit;
(ii) The term "charitable contribution" means a contribution or gift to or for the use of a corporation or organization, described in Section 170(c)(2) of the Internal Revenue Code of 1986, as amended;
(iii) The term "membership fee" does not include any amounts paid for tangible personal property or specific services rendered to members by the corporation or organization; or
(G) The exemption allowed by this subdivision (6) does not apply to sales of gasoline or special fuel or to sales of tangible personal property or services to be used or consumed in the generation of unrelated business income as defined in Section 513 of the Internal Revenue Code of 1986, as amended. The provisions of this subdivision apply to sales made after the thirtieth day of June, one thousand nine hundred eighty-nine: Provided, That the exemption granted in this subdivision applies only to services, equipment, supplies and materials used or consumed in the activities for which the organizations qualify as tax exempt organizations under the Internal Revenue Code and shall not apply to purchases of gasoline or special fuel;
(7) An isolated transaction in which any taxable service or any tangible personal property is sold, transferred, offered for sale or delivered by the owner of the property or by his or her representative for the owner's account, the sale, transfer, offer for sale or delivery not being made in the ordinary course of repeated and successive transactions of like character by the owner or on his or her account by the representative: Provided, That nothing contained in this subdivision may be construed to prevent an owner who sells, transfers or offers for sale tangible personal property in an isolated transaction through an auctioneer from availing himself or herself of the exemption provided in this subdivision, regardless where the isolated sale takes place. The tax commissioner may adopt such legislative rule pursuant to article three, chapter twenty-nine-a of this code as he or she considers necessary for the efficient administration of this exemption;
(8) Sales of tangible personal property or of any taxable services rendered for use or consumption in connection with the commercial production of an agricultural product the ultimate sale of which will be subject to the tax imposed by this article or which would have been subject to tax under this article: Provided, That sales of tangible personal property and services to be used or consumed in the construction of or permanent improvement to real property and sales of gasoline and special fuel are not exempt: Provided, however, That nails and fencing shall not be considered as improvements to real property;
(9) Sales of tangible personal property to a person for the purpose of resale in the form of tangible personal property: Provided, That sales of gasoline and special fuel by distributors and importers is taxable except when the sale is to another distributor for resale: Provided, however, That sales of building materials or building supplies or other property to any person engaging in the activity of contracting, as defined in this article, which is to be installed in, affixed to or incorporated by that person or his or her agent into any real property, building or structure is not exempt under this subdivision, except that sales of tangible personal property to a person engaging in the activity of contracting pursuant to a written contract with the United States, this state, or with a political subdivision of this state, or with a public corporation created by the Legislature or by another governmental entity pursuant to an act of the Legislature, for a building or structure, or improvement thereto, or other improvement to real property that is or will be owned and used by the governmental entity for a governmental or proprietary purpose, who incorporates the property in the building, structure or improvement shall, with respect to the tangible personal property, nevertheless be considered to be the vendor of the property to the governmental entity and any person seeking to qualify for and assert this exception must do so pursuant to the legislative rules as the tax commissioner may promulgate and upon such forms as the tax commissioner may prescribe. A subcontractor who, pursuant to a written subcontract with a prime contractor who qualifies for this exception, provides equipment, or materials, and labor to a prime contractor shall be treated in the same manner as the prime contractor is treated with respect to the prime contract under this exception and the legislative rules promulgated by the tax commissioner: Provided further, That the exemption for government contractors in the preceding proviso expires on the first day of October, one thousand nine hundred ninety, subject to the transition rules set forth in section eight-c of this article;
(10) Sales of newspapers when delivered to consumers by route carriers;
(11) Sales of drugs dispensed upon prescription and sales of insulin to consumers for medical purposes;
(12) Sales of radio and television broadcasting time, preprinted advertising circulars and newspaper and outdoor advertising space for the advertisement of goods or services;
(13) Sales and services performed by day-care centers;
(14) Casual and occasional sales of property or services not conducted in a repeated manner or in the ordinary course of repetitive and successive transactions of like character by a corporation or organization which is exempt from tax under subdivision (6) of this subsection on its purchases of tangible personal property or services:
(A) For purposes of this subdivision, the term "casual and occasional sales not conducted in a repeated manner or in the ordinary course of repetitive and successive transactions of like character" means sales of tangible personal property or services at fund raisers sponsored by a corporation or organization which is exempt, under subdivision (6) of this subsection, from payment of the tax imposed by this article on its purchases, when the fund raisers are of limited duration and are held no more than six times during any twelve-month period and "limited duration" means no more than eighty-four consecutive hours;
(B) The provisions of this subdivision apply to sales made after the thirtieth day of June, one thousand nine hundred eighty-nine;
(15) Sales of property or services to a school which has approval from the board of trustees of the university system of West Virginia or the board of directors of the state college system to award degrees, which has its principal campus in this state, and which is exempt from federal and state income taxes under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended: Provided, That sales of gasoline and special fuel are taxable;
(16) Sales of mobile homes to be utilized by purchasers as their principal year-round residence and dwelling: Provided, That these mobile homes are subject to tax at the three-percent rate;
(17) Sales of lottery tickets and materials by licensed lottery sales agents and lottery retailers authorized by the state lottery commission, under the provisions of article twenty- two, chapter twenty-nine of this code;
(18) Leases of motor vehicles titled pursuant to the provisions of article three, chapter seventeen-a of this code to lessees for a period of thirty or more consecutive days. This exemption applies to leases executed on or after the first day of July, one thousand nine hundred eighty-seven, and to payments under long-term leases executed before that date, for months thereof beginning on or after that date;
(19) Sales of propane to consumers for poultry house heating purposes, with any seller to the consumer who may have prior paid the tax in his or her price, to not pass on the same to the consumer, but to make application and receive refund of the tax from the tax commissioner, pursuant to rules which shall be promulgated by the tax commissioner; notwithstanding the provisions of section eighteen of this article or any other provision of this article to the contrary;
(20) Any sales of tangible personal property or services purchased after the thirtieth day of September, one thousand nine hundred eighty-seven, and lawfully paid for with food stamps pursuant to the federal food stamp program codified in 7 U. S. C. §2011 et seq., as amended, or with drafts issued through the West Virginia special supplement food program for women, infants and children codified in 42 U. S. C. §1786;
(21) Sales of tickets for activities sponsored by elementary and secondary schools located within this state;
(22) Sales of electronic data processing services and related software: Provided, That for the purposes of this subdivision "electronic data processing services" means: (A) The processing of another's data, including all processes incident to processing of data such as keypunching, keystroke verification, rearranging or sorting of previously documented data for the purpose of data entry or automatic processing and changing the medium on which data is sorted, whether these processes are done by the same person or several persons; and (B) providing access to computer equipment for the purpose of processing data or examining or acquiring data stored in or accessible to the computer equipment;
(23) Tuition charged for attending educational summer camps;
(24) Dispensing of services performed by one corporation, partnership or limited liability company for another corporation, partnership or limited liability company when the entities are members of the same controlled group or are related taxpayers as defined in Section 267 of the Internal Revenue Code. "Control" means ownership, directly or indirectly, of stock, equity interests or membership interests possessing fifty percent or more of the total combined voting power of all classes of the stock of a corporation, equity interests of a partnership or membership interests of a limited liability company entitled to vote or ownership, directly or indirectly, of stock, equity interests or membership interests possessing fifty percent or more of the value of the corporation, partnership or limited liability company;
(25) Food for the following are exempt:
(A) Food purchased or sold by public or private schools, school sponsored student organizations or school sponsored parent-teacher associations to students enrolled in such school or to employees of such school during normal school hours; but not those sales of food made to the general public;
(B) Food purchased or sold by a public or private college or university or by a student organization officially recognized by the college or university to students enrolled at the college or university when the sales are made on a contract basis so that a fixed price is paid for consumption of food products for a specific period of time without respect to the amount of food product actually consumed by the particular individual contracting for the sale and no money is paid at the time the food product is served or consumed;
(C) Food purchased or sold by a charitable or private nonprofit organization, a nonprofit organization or a governmental agency under a program to provide food to low-income persons at or below cost;
(D) Food sold in an occasional sale by a charitable or nonprofit organization including volunteer fire departments and rescue squads, if the purpose of the sale is to obtain revenue for the functions and activities of the organization and the revenue obtained is actually expended for that purpose;
(E) Food sold by any religious organization at a social or other gathering conducted by it or under its auspices, if the purpose in selling the food is to obtain revenue for the functions and activities of the organization and the revenue obtained from selling the food is actually used in carrying on those functions and activities: Provided, That purchases made by the organizations e are not exempt as a purchase for resale;
(26) Sales of food by little leagues, midget football leagues, youth football or soccer leagues and similar types of organizations, including scouting groups and church youth groups, if the purpose in selling the food is to obtain revenue for the functions and activities of the organization and the revenues obtained from selling the food is actually used in supporting or carrying on functions and activities of the groups: Provided, That the purchases made by the organizations are not exempt as a purchase for resale;
(27) Charges for room and meals by fraternities and sororities to their members: Provided, That the purchases made by a fraternity or sorority are not exempt as a purchase for resale;
(28) Sales of or charges for the transportation of passengers in interstate commerce;
(29) Sales of tangible personal property or services to any person which this state is prohibited from taxing under the laws of the United States or under the constitution of this state;
(30) Sales of tangible personal property or services to any person who claims exemption from the tax imposed by this article or article fifteen-a of this chapter pursuant to the provision of any other chapter of this code;
(31) Charges for the services of opening and closing a burial lot;
(32) Sales of livestock, poultry or other farm products in their original state by the producer thereof or a member of the producer's immediate family who is not otherwise engaged in making retail sales of tangible personal property; and sales of livestock sold at public sales sponsored by breeders or registry associations or livestock auction markets: Provided, That the exemptions allowed by this subdivision apply to sales made on or after the first day of July, one thousand nine hundred ninety, and may be claimed without presenting or obtaining exemption certificates: Provided, however, That the farmer shall maintain adequate records;
(33) Sales of motion picture films to motion picture exhibitors for exhibition if the sale of tickets or the charge for admission to the exhibition of the film is subject to the tax imposed by this article and sales of coin-operated video arcade machines or video arcade games to a person engaged in the business of providing the machines to the public for a charge upon which the tax imposed by this article is remitted to the tax commissioner: Provided, That the exemption provided in this subdivision applies to sales made on or after the first day of July, one thousand nine hundred ninety, and may be claimed by presenting to the seller a properly executed exemption certificate;
(34) Sales of aircraft repair, remodeling and maintenance services when such services are to an aircraft operated by a certified or licensed carrier of persons or property, or by a governmental entity, or to an engine or other component part of an aircraft operated by a certificated or licensed carrier of persons or property, or by a governmental entity and sales of tangible personal property that is permanently affixed or permanently attached as a component part of an aircraft owned or operated by a certificated or licensed carrier of persons or property, or by a governmental entity, as part of the repair, remodeling or maintenance service and sales of machinery, tools or equipment, directly used or consumed exclusively in the repair, remodeling or maintenance of aircraft, aircraft engines, or aircraft component parts, for a certificated or licensed carrier of persons or property, or for a governmental entity;
(35) Charges for memberships or services provided by health and fitness organizations relating to personalized fitness programs;
(36) Sales of services by individuals who baby-sit for a profit: Provided, That the gross receipts of the individual from the performance of baby-sitting services do not exceed five thousand dollars in a taxable year;
(37) Sales of services after the thirtieth day of June, one thousand nine hundred ninety-seven, by public libraries or by libraries at academic institutions or by libraries at institutions of higher learning;
(38) Commissions received after the thirtieth day of June, one thousand nine hundred ninety-seven, by a manufacturer's representative;
(39) Sales of primary opinion research services after the thirtieth day of June, one thousand nine hundred ninety-seven, when:
(A) The services are provided to an out-of-state client;
(B) The results of the service activities, including, but not limited to, reports, lists of focus group recruits and compilation of data are transferred to the client across state lines by mail, wire or other means of interstate commerce, for use by the client outside the state of West Virginia; and
(C) The transfer of the results of the service activities is an indispensable part of the overall service.
For the purpose of this subdivision the term "primary opinion research" means original research in the form of telephone surveys, mall intercept surveys, focus group research, direct mail surveys, personal interviews and other data collection methods commonly utilized for quantitative and qualitative opinion research studies;
(40) Sales of property or services after the thirtieth day of June, one thousand nine hundred ninety-seven, to persons within the state when those sales are for the purposes of the production of value-added products: Provided, That the exemption granted in this subdivision applies only to services, equipment, supplies and materials directly used or consumed by such persons engaged solely in the production of value-added products: Provided, however, That this exemption may not be claimed by any one purchaser for more than five consecutive years, except as otherwise permitted in this section.
For the purpose of this subdivision, the term "value-added product" means the following products derived from processing a raw agricultural product, whether for human consumption or for other use: For purposes of this subdivision, the following enterprises qualify as processing raw agricultural products into value-added products: Those engaged in the conversion of:
(A) Lumber into furniture, toys, collectibles and home furnishings;
(B) Fruits into wine;
(C) Honey into wine;
(D) Wool into fabric;
(E) Raw hides into semi-finished or finished leather products;
(F) Milk into cheese;
(G) Fruits or vegetables into a dried, canned or frozen product;
(H) Feeder cattle into commonly accepted slaughter weights; (I) Aquatic animals into a dried, canned, cooked or frozen product; and
(J) Poultry into a dried, canned, cooked or frozen product;
(41) Sales of music instructional services after the thirtieth day of June, one thousand nine hundred ninety-seven, by a music teacher; and
(42) After the thirtieth day of June, one thousand nine hundred ninety-seven, charges to a member by a membership association or organization which is exempt from paying federal income taxes under section 501(c)(3) or (c)(6) of the Internal Revenue Code of 1986, as amended, for membership in the association or organization, including charges to members for newsletters prepared by the association or organization for distribution primarily to its members, charges to members for continuing education seminars, workshops, conventions, lectures or courses put on or sponsored by the association or organization, including charges for related course materials prepared by the association or organization or by the speaker or speakers for use during the continuing education seminar, workshop, convention, lecture or course, but not including any separate charge or separately stated charge for meals, lodging, entertainment or transportation taxable under this article: Provided, That the association or organization pays the tax imposed by this article on its purchases of meals, lodging, entertainment or transportation taxable under this article for which a separate or separately stated charge is not made. A membership association or organization which is exempt from paying federal income taxes under Section 501(c)(3) or (c)(6) of the Internal Revenue Code of 1986, as amended, may elect to pay the tax imposed under this article on the purchases for which a separate charge or separately stated charge could apply and not charge its members the tax imposed by this article or, the association or organization may avail itself of the exemption set forth in subdivision (9) of this subsection relating to purchases of tangible personal property for resale and then collect the tax imposed by this article on those items from its member.
(b) Refundable exemptions. -- Any person having a right or claim to any exemption set forth in this subsection shall first pay to the vendor the tax imposed by this article and then apply to the tax commissioner for a refund or credit, or as provided in section nine-d of this article, give to the vendor such person's West Virginia direct pay permit number. The following sales of tangible personal property and/or services are exempt from tax as provided in this subsection:
(1) Sales of property or services to bona fide charitable organizations who make no charge whatsoever for the services they render: Provided, That the exemption granted in this subdivision applies only to services, equipment, supplies, food, meals and materials directly used or consumed by these organizations, and shall not apply to purchases of gasoline or special fuel;
(2) Sales of services, machinery, supplies and materials directly used or consumed in the activities of manufacturing, transportation, transmission, communication, production of natural resources, gas storage, generation or production or selling electric power, provision of a public utility service or the operation of a utility service or the operation of a utility business, in the businesses or organizations named above and shall not apply to purchases of gasoline or special fuel;
(3) Sales of property or services to nationally chartered fraternal or social organizations for the sole purpose of free distribution in public welfare or relief work: Provided, That sales of gasoline and special fuel are taxable;
(4) Sales and services, fire fighting or station house equipment, including construction and automotive, made to any volunteer fire department organized and incorporated under the laws of the state of West Virginia: Provided, That sales of gasoline and special fuel are taxable; and
(5) Sales of building materials or building supplies or other property to an organization qualified under Section 501(c)(3) or (c)(4) of the Internal Revenue Code of 1986, as amended, which are to be installed in, affixed to or incorporated by the organization or its agent into real property, or into a building or structure which is or will be used as permanent low- income housing, transitional housing, emergency homeless shelter, domestic violence shelter or emergency children and youth shelter if the shelter is owned, managed, developed or operated by an organization qualified under Section 501(c)(3) or (c)(4) of the Internal Revenue Code of 1986, as amended.