Senate Bill No. 91
(By Senator Snyder)
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[Introduced February 15, 2001; referred to the
Committee on the Judiciary; and then to the Committee on Finace.]
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A BILL to amend and reenact sections two, three and eight,
article twenty-three, chapter forty-seven of the code of
West Virginia, one thousand nine hundred thirty-one, as
amended; and to further amend said article by adding thereto
a new section, designated section ten-a, all relating to
charitable raffle boards and games; redefining terms;
increasing certain fees; providing for the calculation and
quarterly payment of fees; establishing administrative
remedies; and providing for the deposit of civil penalties.
Be it enacted by the Legislature of West Virginia:
That sections two, three and eight, article twenty-three,
chapter forty-seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted;
and that said article be further amended by adding thereto a new
section, designated section ten-a, all to read as follows:
ARTICLE 23. CHARITABLE RAFFLE BOARDS AND GAMES.
§47-23-2. Definitions.
For purposes of this article, unless specified otherwise:
(a) "Commissioner" means tax commissioner of the state of
West Virginia, or his delegate.
(b) "Retail value" means the actual consideration paid to
the wholesaler by the retailer for any raffle boards or games or,
in the absence of consideration paid, the actual cost to the
wholesaler of the raffle boards or games.
(c) "Person" means any individual, association, society,
incorporated or unincorporated organization, firm, partnership or
other nongovernmental entity or institution.
(d) "Retailer" means every person engaged in the business of
making retail sales of raffle chances except a charitable or
public service organization authorized to conduct raffles without
a license pursuant to section three, article twenty-one of this
chapter the provisions of this code governing charitable raffles.
(e) "Charitable raffle board" or "charitable raffle game" means: (1) A board or other device that has many folded printed
slips to be pulled from the board or otherwise distributed
without a board on payment of a nominal sum in an effort to
obtain a slip or chance that entitles the player to a designated
prize; (2) a series of paper cards with perforated break-open
tabs, a face value of which is covered or otherwise hidden from
view to conceal one or more numbers, letters or symbols, which,
on payment of a nominal sum, entitles the player to obtain a
chance to a designated prize; or (3) such other similar game
which may be defined by the state tax commissioner by legislative
rule.
(f) "Sale" means the transfer of the ownership of tangible
personal property for a consideration.
(g) "Verification" means a unique manufacture identifiable
serial number which is required to be printed on each ticket in
a charitable raffle board or charitable raffle game or such other
form of identification as may be prescribed by the tax
commissioner upon a showing of undue hardship by the taxpayer:
Provided, That such other form of identification shall be
prescribed by rule in accordance with the provisions of article
three, chapter twenty-nine-a of this code.
(h) "Wholesaler" or "distributor" means any person or entity
engaged in the wholesale distribution of charitable raffle boards
or games or similar boards or devices, as defined by the
commissioner, and licensed under the provisions of this article,
to distribute said devices to charitable raffle boards or games
retailers as defined in this article. It also includes anyone
who is engaged in the manufacturing, packaging, preparing or
repackaging of charitable raffle boards or games for distribution
in this state: Provided, That no license taxes or other fees
provided for in this section may be charged to any newspaper or
other printing or duplicating operation not regularly engaged in
the business of manufacturing, packaging, preparing or
repackaging charitable raffle boards or games where the gross
sales of such printing or duplicating operation from such
activity does not exceed seven thousand five hundred dollars per
calendar year and who is donating such items or services to a
nonprofit entity without compensation may not be considered a
"wholesaler" or "distributor" under this article.
§47-23-3. Fees.
(a) Wholesalers or distributors of charitable raffle boards
and games to retailers shall be licensed and a license fee in the amount of five hundred dollars shall be paid to the commissioner
by each wholesaler or distributor for an annual license.
(b) Wholesalers and distributors shall also pay a fee of
twenty cents on each dollar of retail value of each charitable
raffle board or games game sold to a retailer before the first
day of July, two thousand one. Effective the first day of July,
two thousand one, wholesalers and distributors shall pay a fee of
one hundred percent of retail value of each charitable raffle
board or game sold to a retailer. This fee shall be in addition
to any tax imposed pursuant to the provisions of article fifteen,
chapter eleven of this code.
(c) The fees imposed by this article shall be deposited in
accordance with the provisions of section two-a, article nine,
chapter eleven of this code: Provided, That effective the first
day of July, two thousand one, eighty percent of the fees
collected on charitable raffle boards and games sold shall be
deposited into the general revenue fund of this state.
§47-23-8. How fee paid; reports required; due date; records to
be kept; inspection of records and stocks;
examination of witnesses, summons, etc.
(a) The retail value fee imposed by section three of this article shall be paid by each licensed wholesaler or distributor
to the commissioner on or before the twentieth day of April,
July, October and January for the preceding three calendar
months. The measure of the fee on the retail value of charitable
raffle boards or games shall be determined by multiplying the
total amount of the retail value of all charitable raffle boards
and games sold by a wholesaler or distributor to retailers during
the said three-month period by twenty percent until the thirtieth
day of June, two thousand one and by one hundred percent
effective the first day of July, two thousand one. Said fee
shall be in addition to any tax imposed pursuant to the
provisions of article fifteen, chapter eleven of this code.
(b) All fees due and owing to the commissioner by reason of
this article, if paid after the due dates required by this
section, shall be subject to the provisions of article ten,
chapter eleven of this code.
(c) Each wholesaler or distributor shall provide with each
quarterly payment of fees a return covering the business
transacted in the previous three calendar months and providing
such other information as the commissioner may deem necessary for
the ascertainment or assessment of the fee imposed by this article. Such return shall be signed under penalty of perjury on
such forms as the tax commissioner may prescribe and the
wholesaler or distributor shall at the time of filing remit all
fees owed or due.
(d) The returns prescribed herein are required, although a fee
might not be due or no business transacted for the period covered
by the return.
(e) Each person required to file a return under this article
shall make and keep such records as shall be prescribed by the
commissioner that are necessary to substantiate the returns
required by this article, including, but not limited to,
invoices, serial numbers or other verification, inventories,
receipts, disbursements and sales, for a period of time not less
than three years.
(f) Unless otherwise permitted, in writing, by authority of
the commissioner, each delivery ticket or invoice for each
purchase or sale of charitable raffle boards or games must be
recorded upon a serially numbered invoice showing the name and
address of the seller and the purchaser, the point of delivery,
the date, quantity, serial number and price of the product sold
and the fee must be set out separately, and such other reasonable information as the commissioner may require. These invoicing
requirements also apply to cash sales and a person making such
sales must maintain such records as may be reasonably necessary
to substantiate his or her return.
(g) In addition to the commissioner's powers set forth in
section five, article ten, chapter eleven of this code, the
commissioner shall have authority to inspect or examine the stock
of charitable raffle boards and games kept in and upon the
premises of any person where charitable raffle boards and games
are placed, stored or sold, and he or she shall have authority to
inspect or examine the records, books, papers and any equipment
or records of manufacturers, wholesalers and distributors or any
other person for the purpose of determining the quantity of
charitable raffle boards and games acquired or disbursed to
verify the truth and accuracy of any statement or return and to
ascertain whether the fee imposed by this article has been
properly paid.
(h) In addition to the commissioner's powers set forth in
section five, article ten, chapter eleven of this code, and as a
further means of obtaining the records, books and papers of a
manufacturer, wholesaler, distributor or any other person and ascertaining the amount of fees and returns due under this
article, the commissioner shall have the power to examine
witnesses under oath; and if the witness shall fail or refuse at
the request of the commissioner to grant access to the books,
records or papers, the commissioner shall certify the facts and
names to the circuit court of the county having jurisdiction of
the party and such court shall thereupon issue summons to such
party to appear before the commissioner, at a place designated
within the jurisdiction of such court, on a day fixed, to be
continued as the occasion may require for good cause shown and
give such evidence and lay open for inspection such books and
papers as may be required for the purpose of ascertaining the
amount of fee and returns due, if any.
§47-23-10a. Civil remedies when retailer possesses charitable
raffle boards and games not purchased from a
wholesaler or distributor licensed under this
article.
(a) A retailer who possesses charitable raffle boards and
games that were not purchased from a wholesaler or distributor
licensed under this article shall be subject to the following
civil remedies:
(1) For a first offense, the retailer shall pay to the
commissioner, a civil money penalty of not less than one hundred
nor more than five hundred dollars for each charitable raffle
board or game in the possession of the retailer that was not
purchased from a wholesaler or distributor licensed under this
article.
(2) For a second and each subsequent offense, the retailer
shall pay to the commissioner, a civil money penalty of not less
than five hundred nor more than one thousand five hundred dollars
for each charitable raffle board or game in the possession of the
retailer that was not purchased from a wholesaler or distributor
licensed under this article.
(3) For a second offense, the retailer, in addition to
paying the money penalty imposed in subdivision (2) of this
subsection, shall have all licenses issued under article sixteen,
chapter eleven of this code and article seven, chapter sixty of
this code, for the place of business in which charitable raffle
boards and games not purchased from a wholesaler or distributor
licensed under this article were found, suspended for a period of
thirty consecutive days. The alcohol beverage control
commissioner shall suspend the licenses of a retailer upon receipt of the tax commissioner's certified order issued under
this subdivision.
(4) For a third and each subsequent offense, the retailer,
in addition to applying the money penalty imposed in subdivision
(2) of this subsection shall have the business registration
certificate issued under article twelve, chapter eleven of this
code and the licenses issued under articles twelve and sixteen,
chapter eleven of this code and article seven, chapter sixty of
this code, for the place of business in which charitable raffle
boards and games not purchased from a wholesaler or distributor
licensed under this article were found, suspended for a period of
thirty consecutive days. The alcohol beverage control
commissioner shall suspend the licenses of a retailer upon
receipt of the tax commissioner's certified order issued under
this subsection. Additionally, any license issued to the
retailer to conduct charitable bingo games or raffles shall be
suspended for a period of thirty consecutive days.
(b) Administrative procedures. -
(1) An order issued under this section by the tax
commissioner shall be served by certified mail or in the manner
provided in rule 4(d) of the West Virginia rules of civil procedure.
(2) A retailer may appeal an order of the tax commissioner
issued under this section by filing a written protest with the
tax commissioner, either in person or by certified mail, within
twenty days after the licensee is served with a copy of the
order.
(3) When a written protest is filed timely, the provisions
of article five, chapter twenty-nine-a of this code shall apply.
The tax commissioner may, by procedural rule, specify the form
and content of a written protest.
(4) The burden of proof in any administrative or court
proceeding is on the licensee to show cause why the order of the
tax commissioner under this section should be modified, in whole
or in part, or set aside.
(c) Deposit of money penalties. -- All money penalties
imposed under this section and collected by the tax commissioner,
shall be deposited into the general revenue fund of this state.
NOTE: The purpose of this bill is to set the fee
wholesalers and distributors pay on charitable raffle boards and
games sold to retailers at one hundred percent of retail value.
The bill also creates civil penalties where retailers possess charitable raffle boards and games which were purchased from a
wholesaler or distributor not licensed to sell them.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
Section ten-a is new; therefore, strike-throughs and
underscoring have been omitted.