H. B. 3014
(By Mr. Speaker, Mr. Kiss, and Delegates Michael,
Doyle, Anderson, H. White, G. White and Browning)
[Introduced February 14, 2003; referred to the
Committee on Finance.]
A BILL to amend and reenact sections one-a, two, three, four,
four-a, four-b, five, six, eight, nine-f, thirteen, fourteen,
sixteen, thirty-one and thirty-three, article fifteen, chapter
eleven of the code of West Virginia, one thousand nine hundred
thirty-one, as amended; to amend and reenact sections one,
one-a, two, three, three-a, four, five, six, seven, eight,
nine, ten, ten-a, eleven, eighteen, twenty-one, twenty-two,
twenty-seven and twenty-nine, article fifteen-a of said
chapter; to amend and reenact sections one, two, three, and
five, article fifteen-b of said chapter; and to further amend
said article fifteen-b by adding thereto twenty-three new
sections, designated sections two-a, eleven, twelve, thirteen,
fourteen, fifteen, sixteen, seventeen, eighteen, nineteen,
twenty, twenty-one, twenty-two, twenty-three, twenty-four,
twenty-five, twenty-six, twenty-seven, twenty-eight,
twenty-nine, thirty, thirty-one and thirty-two, all relating generally to "Main Street Fairness Act of 2003," amending
consumers sales and service and use tax laws to conform to
requirements of streamlined sales and use tax agreement;
incorporating in this state's sales and use tax laws certain
substantive provisions of agreement pertaining to definitions,
administration, collection and enforcement of sales and use
taxes; renaming simplified sales and use tax administration
act as streamlined sales and use tax administration act;
authorizing tax commissioner to sign agreement; specifying
effective dates; deleting obsolete language and making other
technical changes.
Be it enacted by the Legislature of West Virginia:
That sections one-a, two, three, four, four-a, four-b, five,
six, eight, nine-f, thirteen, fourteen, sixteen, thirty-one and
thirty-three, article fifteen, chapter eleven of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended and reenacted; that sections one, one-a, two, three,
three-a, four, five, six, seven, eight, nine, ten, ten-a, eleven,
eighteen, twenty-one, twenty-two, twenty-seven and twenty-nine,
article fifteen-a of said chapter, be amended and reenacted; that
sections one, two, three, and five, article fifteen-b of said
chapter be amended and reenacted; and to further amended said
article by adding thereto twenty-three new sections, designated
sections two-a, eleven, twelve, thirteen, fourteen, fifteen, sixteen, seventeen, eighteen, nineteen, twenty, twenty-one,
twenty-two, twenty-three, twenty-four, twenty-five, twenty-six,
twenty-seven, twenty-eight, twenty-nine, thirty, thirty-one and
thirty-two, all to read as follows:
ARTICLE 15. CONSUMERS SALES AND SERVICE TAX.
§11-15-1a. Legislative findings.
The Legislature hereby finds and declares that:
(1) It is the intent of the Legislature that the consumers
sales tax imposed by the provisions of article fifteen and the use
tax imposed by the provisions of article fifteen-a of this chapter,
eleven of the code of West Virginia, one thousand nine hundred
thirty-one, as amended be complementary laws and wherever possible
be construed and applied to accomplish such intent as to the
imposition, administration and collection of such these taxes;
and
(2) On and after the first day of January, two thousand four,
the taxes levied by this article and article fifteen-a of this
chapter shall also be administered and collected in accordance with
the provisions of article fifteen-b of this chapter.
§11-15-2. Definitions.
For the purpose of this article: (a) General. -- When used in
this article and article fifteen-a of this chapter, words defined
in subsection (b) of this section shall have the meanings ascribed
to them in this section, except in those instances where a different meaning is provided in this article or the context in
which the word is used clearly indicates that a different meaning
is intended by the Legislature.
(b) Definitions. --
(a)(1) "Business" includes all activities engaged in or caused
to be engaged in with the object of gain or economic benefit,
direct or indirect, and all activities of the state and its
political subdivisions which involve sales of tangible personal
property or the rendering of services when those service activities
compete with or may compete with the activities of other persons.
(b)(2) "Communication" means all telephone, radio, light,
light wave, radio telephone, telegraph and other communication or
means of communication, whether used for voice communication,
computer data transmission or other encoded symbolic information
transfers and shall include commercial broadcast radio, commercial
broadcast television and cable television.
(c)(3) "Contracting":
(1)(A) In general. -- "Contracting" means and includes the
furnishing of work, or both materials and work, for another (by a
sole contractor, general contractor, prime contractor,
subcontractor or construction manager) in fulfillment of a contract
for the construction, alteration, repair, decoration or improvement
of a new or existing building or structure, or any part thereof, or
for removal or demolition of a building or structure, or any part thereof, or for the alteration, improvement or development of real
property. Contracting means and also includes services provided by
a construction manager so long as the project for which the
construction manager provides the services results in a capital
improvement to a building or structure or to real property.
(2)(B) Form of contract not controlling. -- An activity that
falls within the scope of the definition of contracting shall
constitute contracting regardless of whether the contract governing
the activity is written or verbal and regardless of whether it is
in substance or form a lump sum contract, a cost-plus contract, a
time and materials contract, whether or not open-ended, or any
other kind of construction contract.
(3)(C) Special rules. -- For purposes of this definition:
(A)(i) The term "structure" includes, but is not limited to,
everything built up or composed of parts joined together in some
definite manner and attached or affixed to real property or which
adds utility to real property or any part thereof or which adds
utility to a particular parcel of property and is intended to
remain there for an indefinite period of time;
(B)(ii) The term "alteration" means, and is limited to,
alterations which are capital improvements to a building or
structure or to real property;
(C)(iii) The term "repair" means, and is limited to, repairs
which are capital improvements to a building or structure or to real property;
(D)(iv) The term "decoration" means, and is limited to,
decorations which are capital improvements to a building or
structure or to real property;
(E)(v) The term "improvement" means, and is limited to,
improvements which are capital improvements to a building or
structure or to real property;
(F)(vi) The term "capital improvement" means improvements that
are affixed to or attached to and become a part of a building or
structure or the real property or which add utility to real
property, or any part thereof, and that last or are intended to be
relatively permanent. As used herein, "relatively permanent" means
lasting at least a year in duration without the necessity for
regularly scheduled recurring service to maintain the capital
improvement. "Regular recurring service" means regularly scheduled
service intervals of less than one year;
(G)(vii) Contracting does not include the furnishing of work,
or both materials and work, in the nature of hookup, connection,
installation or other services if the service is incidental to the
retail sale of tangible personal property from the service
provider's inventory: Provided, That the hookup, connection or
installation of the foregoing is incidental to the sale of the same
and performed by the seller thereof or performed in accordance with
arrangements made by the seller thereof. Examples of transactions that are excluded from the definition of contracting pursuant
hereto include, but are not limited to, the sale of wall-to-wall
carpeting and the installation of wall-to-wall carpeting, the sale,
hookup and connection of mobile homes, window air conditioning
units, dishwashers, clothing washing machines or dryers, other
household appliances, drapery rods, window shades, venetian blinds,
canvas awnings, free standing industrial or commercial equipment
and other similar items of tangible personal property. Repairs
made to the foregoing are within the definition of contracting if
the repairs involve permanently affixing to or improving real
property or something attached thereto which extends the life of
the real property or something affixed thereto or allows or intends
to allow the real property or thing permanently attached thereto to
remain in service for a year or longer.
(H)(viii) The term "construction manager" means a person who
enters into an agreement to employ, direct, coordinate or manage
design professionals and contractors who are hired and paid
directly by the owner or the construction manager. The business
activities of a "construction manager" as defined herein shall
constitute contracting, so long as the project for which the
construction manager provides the services results in a capital
improvement to a building or structure or to real property.
(d)(1) (4)
"Directly used or consumed" in the activities of
manufacturing, transportation, transmission, communication or the production of natural resources means used or consumed in those
activities or operations which constitute an integral and essential
part of the activities, as contrasted with and distinguished from
those activities or operations which are simply incidental,
convenient or remote to the activities.
(2)(A) Uses of property or consumption of services which
constitute direct use or consumption in the activities of
manufacturing, transportation, transmission, communication or the
production of natural resources includes only:
(A)(i) In the case of tangible personal property, physical
incorporation of property into a finished product resulting from
manufacturing production or the production of natural resources;
(B)(ii) Causing a direct physical, chemical or other change
upon property undergoing manufacturing production or production of
natural resources;
(C)(iii) Transporting or storing property undergoing
transportation, communication, transmission, manufacturing
production or production of natural resources;
(D)(iv) Measuring or verifying a change in property directly
used in transportation, communication, transmission, manufacturing
production or production of natural resources;
(E)(v) Physically controlling or directing the physical
movement or operation of property directly used in transportation,
communication, transmission, manufacturing production or production of natural resources;
(F)(vi) Directly and physically recording the flow of property
undergoing transportation, communication, transmission,
manufacturing production or production of natural resources;
(G)(vii) Producing energy for property directly used in
transportation, communication, transmission, manufacturing
production or production of natural resources;
(H)(viii) Facilitating the transmission of gas, water, steam
or electricity from the point of their diversion to property
directly used in transportation, communication, transmission,
manufacturing production or production of natural resources;
(I)(ix) Controlling or otherwise regulating atmospheric
conditions required for transportation, communication,
transmission, manufacturing production or production of natural
resources;
(J)(x) Serving as an operating supply for property undergoing
transmission, manufacturing production or production of natural
resources, or for property directly used in transportation,
communication, transmission, manufacturing production or production
of natural resources;
(K)(xi) Maintenance or repair of property, including
maintenance equipment, directly used in transportation,
communication, transmission, manufacturing production or production
of natural resources;
(L)(xii) Storage, removal or transportation of economic waste
resulting from the activities of manufacturing, transportation,
communication, transmission or the production of natural resources;
(M)(xiii) Pollution control or environmental quality or
protection activity directly relating to the activities of
manufacturing, transportation, communication, transmission or the
production of natural resources and personnel, plant, product or
community safety or security activity directly relating to the
activities of manufacturing, transportation, communication,
transmission or the production of natural resources; or
(N)(xiv) Otherwise be used as an integral and essential part
of transportation, communication, transmission, manufacturing
production or production of natural resources.
(3)(B) Uses of property or services which do not constitute
direct use or consumption in the activities of manufacturing,
transportation, transmission, communication or the production of
natural resources include, but are not limited to:
(A)(i) Heating and illumination of office buildings;
(B)(ii) Janitorial or general cleaning activities;
(C)(iii) Personal comfort of personnel;
(D)(iv) Production planning, scheduling of work or inventory
control;
(E)(v) Marketing, general management, supervision, finance,
training, accounting and administration; or
(F)(vi) An activity or function incidental or convenient to
transportation, communication, transmission, manufacturing
production or production of natural resources, rather than an
integral and essential part of these activities.
(e)(1) (5)
"Directly used or consumed" in the activities of
gas storage, the generation or production or sale of electric
power, the provision of a public utility service or the operation
of a utility business means used or consumed in those activities or
operations which constitute an integral and essential part of those
activities or operation, as contrasted with and distinguished from
activities or operations which are simply incidental, convenient or
remote to those activities.
(2)(A) Uses of property or consumption of services which
constitute direct use or consumption in the activities of gas
storage, the generation or production or sale of electric power,
the provision of a public utility service or the operation of a
utility business include only:
(A)(i) Tangible personal property, custom software or
services, including equipment, machinery, apparatus, supplies, fuel
and power and appliances, which are used immediately in production
or generation activities and equipment, machinery, supplies, tools
and repair parts used to keep in operation exempt production or
generation devices. For purposes of this subsection, production or
generation activities shall commence from the intake, receipt or storage of raw materials at the production plant site;
(B)(ii) Tangible personal property, custom software or
services, including equipment, machinery, apparatus, supplies, fuel
and power, appliances, pipes, wires and mains, which are used
immediately in the transmission or distribution of gas, water and
electricity to the public, and equipment, machinery, tools, repair
parts and supplies used to keep in operation exempt transmission or
distribution devices, and these vehicles and their equipment as are
specifically designed and equipped for such purposes are exempt
from the tax when used to keep a transmission or distribution
system in operation or repair. For purposes of this subsection,
transmission or distribution activities shall commence from the
close of production at a production plant or wellhead when a
product is ready for transmission or distribution to the public and
shall conclude at the point where the product is received by the
public;
(C)(iii) Tangible personal property, custom software or
services, including equipment, machinery, apparatus, supplies, fuel
and power, appliance, pipes, wires and mains, which are used
immediately in the storage of gas or water, and equipment,
machinery, tools, supplies and repair parts used to keep in
operation exempt storage devices;
(D)(iv) Tangible personal property, custom software or
services used immediately in the storage, removal or transportation of economic waste resulting from the activities of gas storage, the
generation or production or sale of electric power, the provision
of a public utility service or the operation of a utility business;
(E)(v) Tangible personal property, custom software or services
used immediately in pollution control or environmental quality or
protection activity or community safety or security directly
relating to the activities of gas storage, generation or production
or sale of electric power, the provision of a public utility
service or the operation of a utility business.
(3)(B) Uses of property or services which would not constitute
direct use or consumption in the activities of gas storage,
generation or production or sale of electric power, the provision
of a public utility service or the operation of a utility business
include, but are not limited to:
(A)(i) Heating and illumination of office buildings;
(B)(ii) Janitorial or general cleaning activities;
(C)(iii) Personal comfort of personnel;
(D)(iv) Production planning, scheduling of work or inventory
control;
(E)(v) Marketing, general management, supervision, finance,
training, accounting and administration; or
(F)(vi) An activity or function incidental or convenient to
the activities of gas storage, generation or production or sale of
electric power, the provision of public utility service or the operation of a utility business.
(f) "Drugs" includes all sales of drugs or appliances to a
purchaser upon prescription of a physician or dentist and any other
professional person licensed to prescribe.
(g)(6) "Gas storage" means the injection of gas into a storage
reservoir or the storage of gas for any period of time in a storage
reservoir or the withdrawal of gas from a storage reservoir engaged
in by businesses subject to the business and occupation tax imposed
by sections two and two-e, article thirteen of this chapter.
(h)(7) "Generating or producing or selling of electric power"
means the generation, production or sale of electric power engaged
in by businesses subject to the business and occupation tax imposed
by section two, two-d, two-m or two-n, article thirteen of this
chapter.
(i)(8) "Gross proceeds" means the amount received in money,
credits, property or other consideration from sales and services
within this state, without deduction on account of the cost of
property sold, amounts paid for interest or discounts or other
expenses whatsoever. Losses may not be deducted, but any credit or
refund made for goods returned may be deducted.
(9) "Includes" and "including," when used in a definition
contained in this article, shall not be deemed to exclude other
things otherwise within the meaning of the term being defined.
(j) "Management information services" means, and is limited to, data processing, data storage, data recovery and backup,
programming recovery and backup, telecommunications, computation
and computer processing, computer programming, electronic
information and data management activities, or any combination of
these activities, when such activity, or activities, is not subject
to regulation by the West Virginia public service commission and
the activity, or activities, is for the purpose of managing,
planning for, organizing or operating, any industrial or commercial
business, or any enterprise, facility or facilities of an
industrial or commercial business, whether the industrial or
commercial business or enterprise, facility or facilities of an
industrial or commercial business is located within or without this
state and without regard to whether the industrial or commercial
business, or enterprise, facility or facilities of an industrial or
commercial business is owned by the provider of the management
information services or by a "related person," as defined in
Section 267(b) of the Internal Revenue Code of 1986, as amended.
(k) "Management information services facility" means a
building, or any part thereof, or a complex of buildings, or any
part thereof, including the machinery and equipment located
therein, that is exclusively dedicated to providing management
information services to the owner or operator thereof or to another
person.
(l)(10) "Manufacturing" means a systematic operation or integrated series of systematic operations engaged in as a business
or segment of a business which transforms or converts tangible
personal property by physical, chemical or other means into a
different form, composition or character from that in which it
originally existed.
(n)(11) "Persons" "Person"
means any individual, partnership,
association, corporation, limited liability company, limited
liability partnership, or any other legal entity including this
state or its political subdivisions or an agency of either, or the
guardian, trustee, committee, executor or administrator of the
person.
(m)(12) "Personal service" includes those: (1)(A) Compensated
by the payment of wages in the ordinary course of employment; and
(2)(B) Rendered to the person of an individual without, at the same
time, selling tangible personal property, such as nursing,
barbering, shoe shining, manicuring and similar services.
(o)(13) Production of natural resource.
(1)(A) "Production of natural resources" means, except for oil
and gas, the performance, by either the owner of the natural
resources or another, of the act or process of exploring,
developing, severing, extracting, reducing to possession and
loading for shipment and shipment for sale, profit or commercial
use of any natural resource products and any reclamation, waste
disposal or environmental activities associated therewith and the construction, installation or fabrication of ventilation
structures, mine shafts, slopes, boreholes, dewatering structures,
including associated facilities and apparatus, by the producer or
others, including contractors and subcontractors, at a coal mine or
coal production facility.
(2)(B) For the natural resources oil and gas, "production of
natural resources" means the performance, by either the owner of
the natural resources, a contractor or a subcontractor, of the act
or process of exploring, developing, drilling, well-stimulation
activities such as logging, perforating or fracturing,
well-completion activities such as the installation of the casing,
tubing and other machinery and equipment and any reclamation, waste
disposal or environmental activities associated therewith,
including the installation of the gathering system or other
pipeline to transport the oil and gas produced or environmental
activities associated therewith and any service work performed on
the well or well site after production of the well has initially
commenced.
(3)(C) All work performed to install or maintain facilities up
to the point of sale for severance tax purposes would be included
in the "production of natural resources" and subject to the direct
use concept.
(4)(D) "Production of natural resources" does not include the
performance or furnishing of work, or materials or work, in fulfillment of a contract for the construction, alteration, repair,
decoration or improvement of a new or existing building or
structure, or any part thereof, or for the alteration, improvement
or development of real property, by persons other than those
otherwise directly engaged in the activities specifically set forth
in this subsection subdivision (13) as "production of natural
resources."
(p)(14) "Providing a public service or the operating of a
utility business" means the providing of a public service or the
operating of a utility by businesses subject to the business and
occupation tax imposed by sections two and two-d, article thirteen
of this chapter.
(q)(15) "Purchaser" means a person who purchases tangible
personal property, custom software or a service taxed by this
article.
(r)(16) "Sale," "sales" or "selling" includes any transfer of
the possession or ownership of tangible personal property or custom
software for a consideration, including a lease or rental, when the
transfer or delivery is made in the ordinary course of the
transferor's business and is made to the transferee or his or her
agent for consumption or use or any other purpose. "Sale" also
includes the furnishing of a service for consideration.
(s)(17) "Service" or "selected service" includes all
nonprofessional activities engaged in for other persons for a consideration, which involve the rendering of a service as
distinguished from the sale of tangible personal property or custom
software, but shall does not include contracting, personal services
or the services rendered by an employee to his or her employer or
any service rendered for resale.
(18) "Streamlined sales and use tax agreement" or "agreement,"
when used in this article, shall have the same meaning as when used
in article fifteen-b of this chapter, except when the context in
which the word agreement is used clearly indicates that a different
meaning is intended by the Legislature.
(t)(19) "Tax" includes all taxes, additions to tax, interest
and penalties levied hereunder under this article or article ten of
this chapter.
(u)(20) "Tax commissioner" means the state tax commissioner or
his or her delegate. The term "delegate" in the phrase "or his or
her delegate," when used in reference to the tax commissioner,
means any officer or employee of the state tax division duly
authorized by the tax commissioner directly, or indirectly by one
or more redelegations of authority, to perform the functions
mentioned or described in this article or rules promulgated for
this article.
(v)(21) "Taxpayer" means any person liable for the tax imposed
by this article or additions to tax, penalties and interest imposed
by article ten of this chapter.
(w)(22) "Transmission" means the act or process of causing
liquid, natural gas or electricity to pass or be conveyed from one
place or geographical location to another place or geographical
location through a pipeline or other medium for commercial
purposes.
(x)(23) "Transportation" means the act or process of
conveying, as a commercial enterprise, passengers or goods from one
place or geographical location to another place or geographical
location.
(y)(24) "Ultimate consumer" or "consumer" means a person who
uses or consumes services or personal property.
(z)(25) "Vendor" means any person engaged in this state in
furnishing services taxed by this article or making sales of
tangible personal property or custom software. "Vendor" and
"seller" are used interchangeably in this article.
(c) Additional definitions. -- Other terms used in this
article are defined in article fifteen-b of this chapter, which
definitions are incorporated by reference into article fifteen.
Additionally, other sections of this article may define terms
primarily used in the section in which the term is defined.
§11-15-3. Amount of tax; allocation of tax and transfers.
(a) Vendor to collect. -- For the privilege of selling
tangible personal property or custom software and for the privilege
of dispensing furnishing certain selected services defined in sections two and eight of this article, the vendor shall collect
from the purchaser the tax as provided under this article and
article fifteen-b of this chapter, and shall pay the amount of tax
to the tax commissioner in accordance with the provisions of this
article or article fifteen-b of this chapter.
(b) Beginning on the first day of March, one thousand nine
hundred eighty-nine, the Amount of tax. -- The general consumer
sales and service tax imposed by this article shall be at the rate
of six cents on the dollar of sales or services, excluding gasoline
and special fuel sales, which remain taxable at the rate of five
cents on the dollar of sales.
(c) Calculation tax on fractional parts of a dollar until
January 1, 2004. -- There shall be no tax on sales where the
monetary consideration is five cents or less. The amount of the
tax shall be computed as follows:
(1) On each sale, where the monetary consideration is from six
cents to sixteen cents, both inclusive, one cent.
(2) On each sale, where the monetary consideration is from
seventeen cents to thirty-three cents, both inclusive, two cents.
(3) On each sale, where the monetary consideration is from
thirty-four cents to fifty cents, both inclusive, three cents.
(4) On each sale, where the monetary consideration is from
fifty-one cents to sixty-seven cents, both inclusive, four cents.
(5) On each sale, where the monetary consideration is from sixty-eight cents to eighty-four cents, both inclusive, five cents.
(6) On each sale, where the monetary consideration is from
eighty-five cents to one dollar, both inclusive, six cents.
(7) If the sale price is in excess of one dollar, six cents on
each whole dollar of sale price, and upon any fractional part of a
dollar in excess of whole dollars as follows: One cent on the
fractional part of the dollar if less than seventeen cents; two
cents on the fractional part of the dollar if in excess of sixteen
cents but less than thirty-four cents; three cents on the
fractional part of the dollar if in excess of thirty-three cents
but less than fifty-one cents; four cents on the fractional part of
the dollar if in excess of fifty cents but less than sixty-eight
cents; five cents on the fractional part of the dollar if in excess
of sixty-seven cents but less than eighty-five cents; and six cents
on the fractional part of the dollar if in excess of eighty-four
cents. For example, the tax on sales from one dollar and one cent
to one dollar and sixteen cents, both inclusive, seven cents; on
sales from one dollar and seventeen cents to one dollar and
thirty-three cents, both inclusive, eight cents; on sales from one
dollar and thirty-four cents to one dollar and fifty cents, both
inclusive, nine cents; on sales from one dollar and fifty-one cents
to one dollar and sixty-seven cents, both inclusive, ten cents; on
sales from one dollar and sixty-eight cents to one dollar and
eighty-four cents, both inclusive, eleven cents and on sales from one dollar and eighty-five cents to two dollars, both inclusive,
twelve cents: Provided, That beginning the first day of January,
two thousand four, tax due under this article shall be calculated
as provided in subsection (d) of this subsection and this
subsection (c) does not apply to sales made after the thirty-first
day of December, two thousand three.
(d) Calculation of tax on fractional parts of a dollar after
December 31, 2003. -- Beginning the first day of January, two
thousand four, the tax computation under subsection (b) of this
section shall be carried to the third decimal place, and the tax
rounded up to the next whole cent whenever the third decimal place
is greater than four and rounded down to the lower whole cent
whenever the third decimal place is four or less. The vendor may
elect to compute the tax due on a transaction on a per item basis
or on an invoice basis provided the method used shall be
consistently used during the reporting period.
(d)(e) No aggregation of separate sales transactions,
exception for coin-operated devices. -- Separate sales, such as
daily or weekly deliveries, shall not be aggregated for the purpose
of computation of the tax even though such sales are aggregated in
the billing or payment therefor. Notwithstanding any other
provision of this article, coin-operated amusement and vending
machine sales shall be aggregated for the purpose of computation of
this tax.
(f) Rate of tax on certain mobile homes. -- Notwithstanding
any provision of this article to the contrary, after the
thirty-first day of December, two thousand three, the tax levied on
sales of mobile homes to be used by the owner thereof as his or her
principal year-round residence and dwelling shall be an amount
equal to six percent of fifty percent of the sales price.
(g) Construction; custom software. -- After the thirty-first
day of December, two thousand three, whenever the words "tangible
personal property" or "property" appear in this article, the same
shall also include the words "custom software."
(f) Computation of tax on sales of gasoline and special fuel.
-- The method of computation of tax provided in this section does
not apply to sales of gasoline and special fuel.
(e) Of the taxes collected under the provisions of this
article, one sixth of such taxes collected for the period
subsequent to the thirty-first day of May, one thousand nine
hundred eighty-eight, prior to the first day of July, one thousand
nine hundred eighty-nine, and not attributable to or resulting from
the repeal of section eleven of this article or attributable to tax
on purchases of gasoline and special fuel, shall be reasonably
allocated, with allowance for refunds and net of reasonable costs
of administration, to and deposited by the tax commissioner in the
special account created in the treasury by section eight-a, article
four-b, chapter twenty-three of this code, not to exceed the amount sufficient for making timely repayment of the principal and
interest under the first payment due, by the thirtieth day of June,
one thousand nine hundred eighty-nine, in repayment for the moneys
previously transferred from such pneumoconiosis fund.
§11-15-4. Purchaser to pay; accounting by vendor.
(a) The purchaser shall pay to the vendor the amount of tax
levied by this article which shall be added to and constitute a
part of the sales price, and shall be collectible as such by the
vendor who shall account to the state for all tax paid by the
purchaser.
The vendor shall keep the amount of tax paid separate from the
proceeds of sale exclusive of the tax unless authorized in writing
by the tax commissioner to keep such amount of tax in a different
manner. Where such authorization is given, the state's claim shall
be enforceable against and shall take precedence over all other
claims against the moneys commingled.
(b) The vendor shall keep records necessary to account for:
(1) The vendor's gross proceeds from sales of personal
property and services;
(2) The vendor's gross proceeds from taxable sales;
(3) The vendor's gross proceed from exempt sales;
(4) The amount of taxes collected under this article, which
taxes shall be held in trust for the state of West Virginia until
paid over to the tax commissioner; and
(5) Such other information as is required by this article, or
article fifteen-b of this chapter, or as may be required by the tax
commissioner.
§11-15-4a. Failure to collect tax; liability of vendor.
If any vendor fails to collect the tax imposed by section
three of this article, he the vendor shall be personally liable for
such the amount as he the vendor failed to collect, except as
otherwise provided in this article or article fifteen-b of this
chapter.
§11-15-4b. Liability of purchaser; assessment and collection.
(a) General. -- If any purchaser refuses or otherwise does not
pay to the vendor the tax imposed by section three of this article,
or in the case of a sale subject to section nine-c of this article,
a purchaser refuses to sign and present to the vendor a proper
certificate indicating the sale is not subject to this tax, or
signs or presents to the vendor a false certificate, or after
signing and presenting a proper certificate uses the items
purchased in such manner that the sale would be subject to the tax,
he the purchaser shall be personally liable for the amount of tax
applicable to the transaction or transactions. Provided, That
nothing herein relieves any purchaser who owes the tax and who has
not paid the tax imposed by section three of this article from
liability therefor
(b) Collection of tax from purchaser. -- Nothing in this section relieves any purchaser who owes the tax and who has not
paid the tax imposed by section three of this article from
liability for payment of the tax. In such cases the tax
commissioner has authority to make an assessment against such the
purchaser, based upon any information within his or her possession
or that may come into his or her possession. This assessment and
notice thereof shall be made and given in accordance with sections
seven and eight, article ten of this chapter.
(c) Liability of vendor. -- This section may not be construed
as relieving the vendor from liability for the tax, except as
otherwise provided in this article or article fifteen-b of this
chapter.
§11-15-5. Total amount collected is to be remitted.
No profit shall accrue to any person as a result of the
collection of the tax levied by this article notwithstanding the
total amount of such taxes collected may be in excess of the amount
for which such person would be liable by the application of the
levy of five percent rate of tax levied by section three of this
article to the vendor's gross proceeds of his from taxable sales
and services. and The total amount of all taxes collected by such
person the vendor shall be returned and remitted to the tax
commissioner as hereinafter provided in this article or article
fifteen-b of this chapter.
§11-15-6. Vendor must show sale or service exempt; presumption.
In the case of sales subject to section nine-c of this
article, the (a) The burden of proving that a sale or service was
exempt from the tax shall be upon the vendor, unless he the vendor
takes from the purchaser an exemption certificate signed by and
bearing the address of the purchaser and setting forth the reason
for the exemption and substantially in the form prescribed by the
tax commissioner: Provided, That when the seller is registered
under the streamlined sales and use tax agreement to collect the
tax imposed by this article, the exemption certificate shall be in
the form prescribed by the governing board of the streamlined sales
and use tax agreement, and the signature of the purchaser is not
required unless a paper exemption certificate is furnished to the
seller.
(b) To prevent evasion, it shall be presumed that all sales
and services are subject to the tax until the contrary is clearly
established.
§11-15-8. Furnishing of services included; exceptions.
The provisions of this article shall apply not only to selling
tangible personal property and custom software, but also to the
furnishing of all services, except professional and personal
services, and except those services furnished by corporations
businesses subject to the control of the public service commission
when the service or the manner in which it is delivered is subject
to regulation by the public service commission.
§11-15-9f. Exemption for sales and services subject to special
district excise tax.
Notwithstanding any provision of this article to the contrary,
any sale or service upon which a special district excise tax is
paid, pursuant to the provisions of section eleven, article
thirteen-b, chapter eight of this code, shall be exempt from the
tax imposed by this article: Provided, That the special district
excise tax does not apply to sales of gasoline and special fuel.
§11-15-13. Collection of tax when sale on credit.
A vendor doing business wholly or partially on a credit basis
shall require the purchaser to pay the full amount of tax due upon
a credit sale at the time such sale is made or within thirty days
thereafter remit to the tax commissioner the tax due on the credit
sale for the month in which the credit transaction occurred.
§11-15-14. When separate records of sales required.
(a) Any vendor engaged in a business subject to this tax, who
is at the same time engaged in some other kind of business,
occupation or profession, not taxable under this article, shall
keep records to show separately the transactions used in
determining the tax base herein taxed under this article.
(b) In the event such the person fails to keep such separate
records there shall be levied upon him the person a tax based upon
the entire gross proceeds of both or all of his the person's
businesses.
§11-15-16. Tax return and payment; exception.
(a) Payment of tax. -- Subject to the exceptions set forth in
subsection (b) of this section, the taxes levied by this article
shall be due and payable in monthly installments, on or before the
fifteenth twentieth day of the month next succeeding the month in
which the tax accrued, except as otherwise provided in this
article.
(b) Tax return. -- The taxpayer shall, on or before the
fifteenth twentieth day of each month, make out and mail to the tax
commissioner a return for the preceding month, in the form
prescribed by the tax commissioner, showing:
(a)(1) The total gross proceeds of his the vendor's business
for that the preceding month;
(b)(2) the gross proceeds of his the vendor's business upon
which the tax is based;
(c)(3) the amount of the tax for which he the vendor is
liable; and
(d)(4) any further information necessary in the computation
and collection of the tax which the tax commissioner may require,
except as otherwise provided in this article or article fifteen-b
of this chapter.
(c) Remittance to accompany return. -- Except as otherwise
provided in this article or article fifteen-b of this chapter, A
remittance for the amount of the tax shall accompany the return. Provided, That notwithstanding the provisions of section thirty of
this article
(d) Deposit of collected tax. -- Tax collected by the tax
commissioner shall be deposited as provided in section thirty of
this article, except that:
(1) Tax collected on sales of gasoline and special fuel shall
be deposited in the state road fund; and
(2) Any such sales tax collected by the alcohol beverage
control commissioner from persons or organizations licensed under
authority of article seven, chapter sixty of this code shall be
paid into a revolving fund account in the state treasury,
designated the drunk driving prevention fund, to be administered by
the commission on drunk driving prevention, subject to
appropriations by the Legislature. Provided, however, That any
balances in the drunk driving prevention fund on the first day of
July, one thousand nine hundred eighty-nine, and all moneys
received into such fund during the fiscal year commencing the first
day of July, one thousand nine hundred eighty-nine, may, up to a
maximum of seven hundred fifty thousand dollars, be used by the
department of public safety for personal services, employee
benefits and unclassified expenditures for the time period
commencing the first day of July, one thousand nine hundred
eighty-nine, and ending the last day of June, one thousand nine
hundred ninety, subject to appropriation by the Legislature
(e) Return to be signed. -- A monthly return shall be signed
by the taxpayer or his the taxpayer's duly authorized agent, when
a paper return is prepared and filed. When the return is filed
electronically, the return shall include the digital mark or
digital signature, as defined in article three, chapter thirty-
nine-a of this code, or the personal identification number of the
taxpayer, or the taxpayer's duly authorized agent, made in
accordance with any procedural rule that may be promulgated by the
tax commissioner.
(b)(f) Accelerated payment. --
(1) For calendar years beginning after the thirty-first day of
December, one thousand nine hundred ninety, Taxpayers whose
average monthly installments for payment of the taxes levied by
this article and article fifteen-a of this chapter during the
previous calendar year exceeds one hundred thousand dollars, shall
remit the tax attributable to the first fifteen days of June each
year on or before the twenty-third twentieth day of said month of
June.
(2) For purposes of complying with subdivision (1) of this
subsection (b)(f), the taxpayer shall remit an amount equal to the
amount of tax imposed by this article and article fifteen-a of this
chapter on actual taxable sales of tangible personal property and
custom software and sales of taxable services during the first
fifteen days of June or, at the taxpayer's election, taxpayer may remit an amount equal to fifty percent of taxpayer's liability for
tax under this article on taxable sales of tangible personal
property and custom software and sales of taxable services made
during the preceding month of May.
(3) For a business which has not been in existence for a full
calendar year, the total tax due from the business during such the
prior calendar year shall be divided by the number of months,
including fractions of a month, that it was in business during such
the prior calendar year; and if that amount exceeds one hundred
thousand dollars, the tax attributable to the first fifteen days of
June each year shall be remitted on or before the twenty-third
twentieth day of said month of June as provided in subdivision (2)
of this subsection (b)(f).
(4) When a taxpayer required to make an advanced payment of
tax under subdivision (1) of this subsection (b) (f) makes out its
return for the month of June, which is due on the fifteenth
twentieth day of July, such the taxpayer may claim as a credit
against its liability under this article for tax on taxable
transactions during the month of June, the amount of the advanced
payment of tax made under subdivision (1) of this subsection
(b)(f).
§11-15-31. Construction and severability.
If any of the provisions of this article are held invalid,
such invalidation shall not affect other provisions which can be given effect without the invalid provision and to this end the
provisions of this article are declared to be severable.
(a) Construction. -- If a court of competent jurisdiction
finds that the provisions of this article and of article fifteen-b
of this chapter conflict and cannot be harmonized, then the
provisions of article fifteen-b shall control.
(b) Severability. -- If any section, subsection, subdivision,
paragraph, sentence, clause or phrase of this article is for any
reason held to be invalid, unlawful or unconstitutional, that
decision may not affect the validity of the remaining portions of
this article or any part thereof.
§11-15-33. Effective date.
(a) The provisions of this article as amended or added by
Senate Bill No. 1 took effect on the first day of March, one
thousand nine hundred eighty-nine, and apply to all sales made on
or after that date: Provided, That if an effective date was
expressly provided in a provision of such act, that specific
effective date controlled in lieu of this general effective date
provision.
(b) The provisions of this article as amended or added by
chapter two hundred one, Acts of the Legislature, one thousand nine
hundred eighty-nine, took effect on the first day of July, one
thousand nine hundred eighty-nine, and apply to all sales made on
or after that date: Provided, That if an effective date is expressly provided in any provision, that specific effective date
shall control in lieu of this general effective date provision.
(c) The provisions of this article as amended or added by
Committee Substitute for House Bill No. 4247 shall take effect on
the first day of July, one thousand nine hundred ninety, and apply
to all sales made on or after that date: Provided, That if an
effective date is expressly provided in any provision of such act,
that specific effective date shall control in lieu of this general
effective date provision with respect to such provision.
The provisions of this article as amended or added during the
regular legislative session in the year two thousand three shall
take effect the first day of January, two thousand four, and apply
to all sales made on or after that date and to all returns and
payments due on or after that day.
ARTICLE 15A. USE TAX.
§11-15A-1. Definitions.
The following words, terms and phrases, when (a) General. --
When used in this article and article fifteen of this chapter,
terms defined in subsection (b) of this section shall have the
meanings ascribed to them in this section, except in those
instances where a different meaning is provided in this article or
the context in which the word is used clearly indicates that a
different meaning is required intended by the Legislature:
(1) "Business" means any activity engaged in by any person, or caused to be engaged in by any person, with the object of direct or
indirect economic gain, benefit or advantage, and includes any
purposeful revenue generating activity in this state;
(2) "Consumer" means any person purchasing tangible personal
property, custom software or a taxable service from a retailer as
defined in paragraph (7) of this subsection (b) or from a seller as
defined in section two, article fifteen-b of this chapter;
(3) "Lease" includes rental, hire and license;
(4) "Person" includes any individual, firm, partnership, joint
venture, joint stock company, association, public or private
corporation, limited liability company, limited liability
partnership, cooperative, estate, trust, business trust, receiver,
executor, administrator, any other fiduciary, any representative
appointed by order of any court or otherwise acting on behalf of
others, or any other group or combination acting as a unit, and the
plural as well as the singular number;
(5) "Purchase" means any transfer, exchange or barter,
conditional or otherwise, in any manner or by any means whatsoever,
for a consideration;
(6) "Purchase price" means the total amount for which tangible
personal property is sold, valued in money, whether paid in money
or otherwise: Provided, That cash discounts allowed and taken on
sales shall not be included measure subject to the tax imposed by
this article and has the same meaning as sales price;
(7) "Retailer" means and includes every person engaging in the
business of selling, leasing or renting tangible personal property
or custom software or furnishing a taxable service for use within
the meaning of this article, or in the business of selling, at
auction, tangible personal property or custom software owned by the
person or others for use in this state: Provided, That when in the
opinion of the tax commissioner it is necessary for the efficient
administration of this article to regard any salesmen,
representatives, truckers, peddlers or canvassers as the agents of
the dealers, distributors, supervisors, employees or persons under
whom they operate or from whom they obtain the tangible personal
property sold by them, irrespective of whether they are making
sales on their own behalf or on behalf of such dealers,
distributors, supervisors, employers or persons, the tax
commissioner may so regard them and may regard the dealers,
distributors, supervisors, employers, or persons as retailers for
purposes of this article;
(8) "Retailer engaging in business in this state" or any like
term, unless otherwise limited by federal statute, shall mean and
include but not be limited to any retailer having or maintaining,
occupying or using, within this state, directly or by a subsidiary,
an office, distribution house, sales house, warehouse, or other
place of business, or any agent (by whatever name called) operating
within this state under the authority of the retailer or its subsidiary, irrespective of whether such place of business or agent
is located here permanently or temporarily, or whether such
retailer or subsidiary is admitted to do business within this state
pursuant to section forty-nine, article one fifteen, chapter
thirty-one thirty-one-d of this code or article fourteen, chapter
thirty-one-e of this code;
(9) "Sale" means any transaction resulting in the purchase or
lease of tangible personal property, custom software or a taxable
service from a retailer;
(10) "Seller" means a retailer, and includes every person
selling or leasing tangible personal property or custom software or
furnishing a taxable service in a transaction which that is subject
to the tax imposed by this article;
(11) "Streamlined sales and use tax agreement" or "agreement,"
when used in this article, shall have the same meaning as when used
in article fifteen-b of this chapter, except when the context in
which the word agreement is used clearly indicates that a different
meaning is intended by the Legislature;
(12) "Tangible personal property" means tangible goods, wares
and merchandise when sold by a retailer for use in this state
personal property that can be seen, weighed, measured, felt, or
touched, or that is in any manner perceptible to the senses.
"Tangible personal property" includes, but is not limited to,
electricity, water, gas, and prewritten computer software;
(11)(13) "Tax commissioner" or "commissioner" means the state
tax commissioner, or his or her delegate. The term "delegate" in
the phrase "or his or her delegate," when used in reference to the
tax commissioner, means any officer or employee of the state tax
division duly authorized by the tax commissioner directly, or
indirectly by one or more redelegations of authority, to perform
the functions mentioned or described in this article or rules
promulgated for this article;
(13)(14) "Taxpayer" includes any person within the meaning of
this section, who is subject to a tax imposed by this article,
whether acting for himself or herself or as a fiduciary.
(14)(15) "Use" means and includes:
(A) The exercise by any person of any right or power over
tangible personal property or custom software incident to the
ownership, possession or enjoyment of such the property, or by any
transaction in which possession of or the exercise of any right or
power over tangible personal property, custom software or the
result of a taxable service is acquired for a consideration,
including any lease, rental or conditional sale of tangible
personal property or custom software; or
(B) The use or enjoyment in this state of the result of a
taxable service. As used in this definition subdivision (15),
"enjoyment" includes a purchaser's right to direct the disposition
of the property or the use of the taxable service, whether or not the purchaser has possession of the property.
The term "use" does not include the keeping, retaining or
exercising any right or power over tangible personal property,
custom software or the result of a taxable service for the purpose
of subsequently transporting it outside the state for use
thereafter solely outside this state.
(b) Additional definitions. -- Other terms used in this
article are defined in articles fifteen and fifteen-b of this
chapter, which definitions are incorporated by reference into
article fifteen-a. Additionally, other sections of this article
may define terms primarily used in the section in which the term is
defined.
§11-15A-1a. Legislative findings.
The Legislature hereby finds and declares that:
(1) It is the intent of the Legislature that the use tax
imposed by the provisions of article fifteen-a and the consumers
sales tax imposed by the provisions of article fifteen chapter
eleven of the Code of West Virginia, one thousand nine hundred
thirty-one, as amended, of this chapter be complementary laws and
wherever possible be construed and applied to accomplish such
intent as to the imposition, administration and collection of such
these taxes; and
(2) On and after the first day of January, two thousand four,
the taxes levied by this article and article fifteen of this chapter shall also be administered and collected in accordance with
the provisions of article fifteen-b of this chapter.
§11-15A-2. Imposition of tax; six percent tax rate; inclusion of
services as taxable; transition rules; allocation of
tax and transfers.
(a) An excise tax is hereby levied and imposed on the use in
this state of tangible personal property, custom software or
taxable services, to be collected and paid as hereinafter provided
in this article or article fifteen-b of this chapter, at the rate
of six percent of the purchase price of such the property or
taxable services, except as otherwise provided in this article.
(b) Calculation of tax on fractional parts of a dollar. -- The
tax computation under subsection (b) of this section shall be
carried to the third decimal place and the tax rounded up to the
next whole cent whenever the third decimal place is greater than
four and rounded down to the lower whole cent whenever the third
decimal place is four or less. The vendor may elect to compute the
tax due on a transaction on a per item basis or on an invoice basis
provided the method used shall be consistently used during the
reporting period.
(c) "Taxable services," for the purposes of this article,
means services of the nature that are subject to the tax imposed by
article fifteen of this chapter. In this article, wherever the
words "tangible personal property" or "property" appear, the same shall include the words "or taxable services," where the context so
requires.
(b)(d) Such Use tax is hereby imposed upon every person using
tangible personal property, custom software or taxable services
service within this state. That person's liability is not
extinguished until such the tax has been paid. A receipt with the
tax separately stated thereon issued by a retailer engaged in
business in this state, or by a foreign retailer who is authorized
by the tax commissioner to collect the tax imposed by this article,
relieves the purchaser from further liability for the tax to which
the receipt refers.
(c)(e) Purchases of tangible personal property or taxable
services made for the government of the United States or any of its
agencies by ultimate consumers shall be subject to the tax imposed
by this section. Industrial materials and equipment owned by the
federal government within the state of West Virginia of a character
not ordinarily readily obtainable within the state, shall not be
subject to use tax when sold, if such industrial materials and
equipment would not be subject to use taxes if such were sold
outside of the state for use in West Virginia.
(d)(f) This article shall does not apply to purchases made by
counties or municipal corporations.
(e) The provisions of this section, as amended, shall apply on
and after the first day of March, one thousand nine hundred eighty-nine, except where another internal specific effective date
controls.
(f) Of the taxes collected under the provisions of this
article, one sixth of such taxes collected for the period
subsequent to the thirty-first day of May, one thousand nine
hundred eighty-eight, and prior to the first day of July, one
thousand nine hundred eighty-nine, and not attributable to or
resulting from the repeal of section eleven, article fifteen of
this chapter or attributable to tax on gasoline and special fuel,
shall be reasonably allocated, with allowances for refunds and net
of reasonable costs of administration, to, and deposited by the tax
commissioner in the special account created in the treasury by
section eight-a, article four-b, chapter twenty-three of this code,
not to exceed the amount sufficient for making timely repayment of
the principal and interest under the first payment due, by the
thirtieth day of June, one thousand nine hundred eighty-nine, in
repayment for the moneys previously transferred from such
pneumoconiosis fund.
§11-15A-3. Exemptions.
(a) The use in this state of the following tangible personal
property, custom software and services is hereby specifically
exempted from the tax imposed by this article to the extent
specified:
(1) All articles of tangible personal property and custom software brought into the state of West Virginia by a nonresident
individual thereof for his or her use or enjoyment while
temporarily within this state or while passing through this state,
except gasoline and special fuel: Provided, That fuel contained in
the supply tank of a motor vehicle that is not a motor carrier
shall may not be taxable.
(2) Tangible personal property, custom software or services,
the gross receipts from the sale of which are exempt from the sales
tax by the terms of article fifteen, chapter eleven of the code of
West Virginia, one thousand nine hundred thirty-one, as amended,
and the property or services are being used for the purpose for
which it was exempted.
(3) Tangible personal property, custom software or services,
the gross receipts or the gross proceeds from the sale of which are
required to be included in the measure of the tax imposed by
article fifteen, chapter eleven of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, and upon which the
tax imposed by said article fifteen has been paid.
(4) Tangible personal property, custom software or services,
the sale of which in this state is not subject to the West Virginia
consumers sales tax.
(5) Mobile Fifty percent of the measure of tax on mobile homes
utilized by the owners thereof as their principal year-round
residence and dwelling. Provided, That use of these mobile homes shall be subject to tax at the three percent rate
(b) The provisions of this section, as amended in the year two
thousand three, shall apply on and after the first day of July, one
thousand nine hundred eighty-seven January, two thousand four.
§11-15A-3a. Moving residence or business into state.
The tax imposed by this article shall does not apply to
tangible personal property, custom software or services purchased
outside this state for use outside this state by a person who at
that time was a nonresident natural person, or a business entity
not actually doing business within this state, who or which later
brings such tangible personal property or custom software into this
state in connection with his establishment of a permanent residence
or business in this state: Provided, That such property was
purchased more than six months prior to the date it was first
brought into this state, or six months prior to the establishment
of such residence or business, whichever first occurs.
§11-15A-4. Evidence of use.
For the purpose of the proper administration of this article
to prevent evasion of the tax, evidence that tangible personal
property, custom software or a service was sold by any person for
delivery in this state shall be prima facie evidence that such the
tangible personal property, custom software or service was sold for
use in this state.
§11-15A-5. How collected.
The tax herein imposed shall be collected in the following
manner:
(1) The tax upon the use of all tangible personal property,
custom software or services, which is sold by a retailer engaging
in business in this state, or by such other retailer as the tax
commissioner shall authorize pursuant to section seven of this
article, or article fifteen -b of this chapter, shall be collected
by such the retailer and remitted to the state tax commissioner,
pursuant to the provisions of sections six through ten, inclusive,
of this article, or by the seller registered under article
fifteen-b of this chapter, in accordance with the provisions of
this article and article fifteen-b of this chapter.
(2) The tax upon the use of all tangible personal property,
custom software and taxable services not paid pursuant to
subsection subdivision one of this section, shall be paid to the
tax commissioner directly by any person using such property or
service within this state, pursuant to the provisions of section
eleven of this article.
§11-15A-6. Collection by retailer.
(a) Every retailer engaging in business in this state and
making sales of tangible personal property, custom software or
taxable services for delivery into this state, or with the
knowledge, directly or indirectly, that the property or service is
intended for use in this state, that are not exempted under the provisions of section three of this article, shall at the time of
making such the sales, whether within or without the state, collect
the tax imposed by this article from the purchaser, and give to the
purchaser a receipt therefor in the manner and form prescribed by
the tax commissioner, if the tax commissioner shall, by regulation
rule, so prescribe.
(b) Each such retailer shall list with the tax commissioner
the name and address of all his the retailer's agents operating in
this state, and the location of any and all distribution or sales
houses or offices or other places of business in this state of the
retailer and the retailer's agent or agents.
§11-15A-7. Foreign retailers.
The tax commissioner may, in his or her discretion, upon
application authorize the collection of the tax herein imposed by
any retailer not engaging in business within this state, who, to
the satisfaction of the tax commissioner, furnishes adequate
security to insure collection and payment of the tax. Such The
retailer shall be issued, without charge, a permit to collect such
the tax in such the manner, and subject to such regulations rules
and agreements as the tax commissioner shall prescribe. When so
authorized, it shall be the duty of such the retailer to collect
the tax upon all tangible personal property, custom software and
services sold to his the retailer's knowledge for use within this
state, in the same manner and subject to the same requirements as a retailer engaging in business within this state. Such The
authority and permit may be cancelled when, at any time, the tax
commissioner considers the security inadequate, or that such the
tax can more effectively be collected from the person using such
the property or taxable service in this state.
§11-15A-8. Absorbing tax; criminal penalty.
(a) It shall be unlawful for any retailer to advertise or hold
out or state to the public or to any purchaser, consumer or user,
directly or indirectly, that the tax or any part thereof imposed by
this article will be assumed or absorbed by the retailer or that it
will not be added to the selling price of the property or taxable
service sold, or if added that it or any part thereof will be
refunded.
(b) The tax commissioner shall have the power to adopt and
promulgate rules and regulations for adding such the tax, or the
equivalent thereof, by providing different methods applying
uniformly to retailers within the same general classification for
the purpose of enabling such retailers to add and collect, as far
as practicable, the amount of such the tax.
(c) Any person violating any of the provisions of this section
within this state shall be is guilty of a misdemeanor, and subject
to the penalties provided in section twenty of this article seven,
article nine of this chapter.
§11-15A-9. Tax as debt.
The tax herein required to be collected by any retailer
pursuant to sections six, six-a or seven of this article, or by any
seller or certified service provider pursuant to article fifteen-b
of this chapter, and any tax collected by any retailer, seller or
certified service provider pursuant to said sections six, six-a or
seven of this article, or article fifteen-b of this chapter, shall
constitute a debt owed by the retailer, seller or certified service
provider to this state. The amount of tax collected shall be held
in trust for the state of West Virginia until paid over to the tax
commissioner.
§11-15A-10. Payment to tax commissioner.
(a) Each retailer required or authorized, pursuant to sections
six, six-a or seven, or pursuant to article fifteen-b of this
chapter, to collect the tax herein imposed, is required to pay to
the tax commissioner the amount of the tax on or before the
fifteenth twentieth day of the month next succeeding each quarterly
period calendar month, except as otherwise provided in this article
or article fifteen-b of this chapter.
(b) Each certified service provider for a Model I seller shall
pay to the tax commissioner the tax levied by this article on or
before the twentieth day of the month next succeeding the calendar
month in which the tax accrued, except as otherwise provided in
this article or article fifteen-b of this chapter.
(b)(c) At that time, each retailer, seller or certified service provider shall file with the tax commissioner a return for
the preceding quarterly monthly period, except as otherwise
provided in this article or article fifteen-b of this chapter, in
the form prescribed by the tax commissioner showing the sales price
of any or all tangible personal property, custom software and
taxable services sold by the retailer or seller during the
preceding quarterly period, the use of which is subject to the tax
imposed by this article, and any other information the tax
commissioner may deem consider necessary for the proper
administration of this article. The return shall be accompanied by
a remittance of the amount of the tax, for the period covered by
the return, except as otherwise provided in this article or article
fifteen-b of this chapter: Provided, That where the tangible
personal property or custom software is sold under a conditional
sales contract, or under any other form of sale wherein the payment
of the principal sum, or a part of the sum is extended over a
period longer than sixty days from the date of the sale, the
retailer may collect and remit each quarterly monthly period that
portion of the tax equal to six percent of that portion of the
purchase price actually received during the quarterly monthly
period. The tax commissioner, if he or she deems it necessary in
order to insure payment to the state of the amount of the tax, may
in any or all cases require returns and payments of the amount to
be made for other than quarterly periods.
(c)(d) The tax commissioner may, upon request and a proper
showing of the necessity to do so, grant an extension of time not
to exceed thirty days for making any return and payment.
(d)(e) Returns shall be signed by the retailer or seller or
his or her duly authorized agent, and must be certified by him or
her to be correct, except as otherwise provided in this article or
article fifteen-b of this chapter.
(f) Accelerated payment. --
(1) For calendar years beginning after the thirty-first day of
December, two thousand two, taxpayers whose average monthly
payment of the taxes levied by this article and article fifteen of
this chapter during the previous calendar year exceeds one hundred
thousand dollars, shall remit the tax attributable to the first
fifteen days of June each year on or before the twentieth day of
said month of June.
(2) For purposes of complying with subdivision (1) of this
subsection, the taxpayer shall remit an amount equal to the amount
of tax imposed by this article and article fifteen of this chapter
on actual taxable sales of tangible personal property and custom
software and sales of taxable services during the first fifteen
days of June or, at the taxpayer's election, taxpayer may remit an
amount equal to fifty percent of taxpayer's liability for tax under
this article on taxable sales of tangible personal property and
custom software and sales of taxable services made during the preceding month of May.
(3) For a business which has not been in existence for a full
calendar year, the total tax due from the business during the prior
calendar year shall be divided by the number of months, including
fractions of a month, that it was in business during such prior
calendar year; and if that amount exceeds one hundred thousand
dollars, the tax attributable to the first fifteen days of June
each year shall be remitted on or before the twentieth day of said
month of June as provided in subdivision (2) of this subsection.
(4) When a taxpayer required to make an advanced payment of
tax under subdivision (1) of subsection (b) makes out its return
for the month of June, which is due on the twentieth day of July,
the taxpayer may claim as a credit against its liability under this
article for tax on taxable transactions during the month of June,
the amount of the advanced payment of tax made under subdivision
(1) of this subsection (f).
§11-15A-10a. Credit for sales tax liability paid to another state.
(a) A person is entitled to a credit against the tax imposed
by this article on the use of a particular item of tangible
personal property, custom software or service equal to the amount,
if any, of sales tax lawfully paid to another state for the
acquisition of that property or service: Provided, That the amount
of credit allowed shall does not exceed the amount of use tax
imposed on the use of the property in this state.
(b) For purposes of this section:
(1) "Sales tax" includes a sales tax or compensating use tax
imposed on the use of tangible personal property or a service by
the state in which the sale occurred; and
(2) "State" includes the District of Columbia but does not
include any of the several territories organized by Congress.
(c) This section shall apply to claims for refund or credit of
use tax filed after the thirty-first day of August, one thousand
nine hundred eighty-six, for taxable purchases made on or after the
first day of July, one thousand nine hundred eighty-five, that were
legally subject to a sales tax or compensating use tax paid in
another state and then also taxed under this article.
§11-15A-11. Liability of user.
(a) Any person who uses any tangible personal property, custom
software or the results of a taxable service upon which the tax
herein imposed has not been paid either to a retailer or direct to
the tax commissioner is liable for the amount of the nonpayment,
and persons required by law to hold a West Virginia business
registration certificate shall on or before the fifteenth day of
the month next succeeding each quarterly period pay the tax herein
imposed upon all the property and services used by him or her
during the preceding quarterly period and accompanied by returns
the tax commissioner prescribes: Provided, That if the aggregate
annual tax liability of any person under this article is six hundred dollars or less, the person shall, in lieu of the quarterly
payment and filing, pay the tax on or before the fifteenth day of
the first month next succeeding the end of his or her taxable year,
and shall file the annual return as may be prescribed by the tax
commissioner. The tax commissioner may, by nonemergency
legislative rules promulgated pursuant to article three, chapter
twenty-nine-a of this code, change the foregoing minimum amounts.
(b) Any individual who is not required by law to hold a West
Virginia business registration certificate, who uses any tangible
personal property or taxable service upon which the West Virginia
use tax has not been paid either to a retailer or directly to the
tax commissioner is liable for the West Virginia use tax upon
property or taxable services and, notwithstanding the amount of the
annual aggregate annual tax liability, shall pay the use tax
imposed upon all property or taxable services used by him or her
during the taxpayer's federal taxable year on or before the
fifteenth day of April of the taxpayer's next succeeding federal
tax year, and shall file the annual return therewith as the tax
commissioner may authorize or require.
(c) All of the provisions of section ten with reference to
quarterly or annual returns and payments are applicable to the
returns and payments required under this section.
(d) The amendments to this section enacted in the year two
thousand are effective for tax years beginning on or after the first day of January, two thousand one.
§11-15A-18. Seller must show sale not at retail; presumption.
(a) The burden of proving that a sale was not taxable shall be
upon the seller, unless, for sales subject to section three-c of
this article, he the seller, in good faith, takes from the
purchaser a certificate signed by and bearing the address of the
purchaser setting forth the reason for exemption of the sale from
imposition of the tax.
(b) Notwithstanding subsection (a) of this section, a seller
who is registered under the streamlined sales and use tax agreement
to collect this tax shall be relieved of the good faith requirement
for the taking of an exemption certificate in accordance with
article fifteen-b of this chapter, and any rule promulgated by the
governing board for the agreement.
(c) To prevent evasion it shall be presumed that all proceeds
are subject to the tax until the contrary is clearly established.
(d) This certificate shall be substantially in the form
prescribed by the tax commissioner: Provided, That when the seller
is registered under the streamlined sales and use tax agreement to
collect the tax imposed by this article, the exemption certificate
taken shall conform with requirements of the streamlined sales and
use tax agreement and any rules prescribed by the governing board
for the agreement.
§11-15A-21. Books; examination.
(a) Every retailer required or authorized to collect taxes
imposed by this article and every person using in this state
tangible personal property, custom software or taxable services
purchased on or after the first day of July, one thousand nine
hundred fifty-one, shall keep such records, receipts, invoices, and
other pertinent papers as the tax commissioner shall require, in
such form as the tax commissioner shall require.
(b) In addition to the tax commissioner's powers set forth in
article ten of this chapter, the tax commissioner or any of his or
her duly authorized agents is hereby authorized to examine the
books, papers, records and equipment of any person who either:
(1) Is selling tangible personal property, custom software or
taxable services; or
(2) Is liable for the tax imposed by this article, and to
investigate the character of the business of any such person in
order to verify the accuracy of any return made, or if no return
was made by such the person, to ascertain and determine the amount
due under the provisions of this article. Any such books, papers
and records shall be made available within this state for such
examination upon reasonable notice when the tax commissioner shall
deem it advisable and shall so order. However, where the
taxpayer's records must be kept out-of-state, the taxpayer may upon
being notified by the tax commissioner that an examination is to be
made, elect to do one of the following:
(1) Forthwith transport the required records to a convenient
point in West Virginia and notify the tax commissioner that they
are available; or
(2) Pay the reasonable traveling expenses of the tax
commissioner's representatives from Charleston, West Virginia, to
the out-of-state place where the records are kept, and return, and
reasonable living expenses of such representatives while engaged in
their examination.
§11-15A-22. Canceling or revoking permits.
Whenever any retailer engaging in business in this state, or
authorized to collect the tax herein imposed pursuant to section
seven of this article, fails to comply with any of the provisions
of this article or any orders, or rules or regulations of the tax
commissioner prescribed and adopted for this article under article
ten of this chapter, the tax commissioner may, upon notice and
hearing, hereinafter provided, by order, cancel the business
registration certificate, if any, issued to such retailer under
article twelve, chapter eleven of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, or if such retailer
is a corporation authorized to do business in this state under
section forty-nine, article one, chapter thirty-one of said article
fifteen, chapter thirty-one-d of this code or article fourteen,
chapter thirty-one-e of this code, may certify to the secretary of
state a copy of an order finding that such the retailer has failed to comply with certain specified provisions, orders, or rules or
regulations. The secretary of state shall, upon receipt of such
certified copy the certification, revoke the permit authorizing
said the corporation to do business in this state, and shall issue
a new permit only when such the corporation shall have has obtained
from the tax commissioner an order finding that such the
corporation has complied with its obligations under this article.
No order authorized in this section shall be made until the
retailer is given an opportunity to be heard and to show cause why
such order should not be made, and he the corporation shall be
given twenty days' notice of the time, place and purpose of such
the hearing, which shall be heard as provided in section nine,
article ten ten-a of this chapter. The tax commissioner shall have
the power in his or her discretion to issue a new business
registration certificate after such canceling the business
registration certificate is cancelled.
§11-15A-27. Construction; partial unconstitutionality.
The provisions of this article shall be deemed to be severable
and if for any reason any provision shall be determined to be
unconstitutional or invalid, such determination shall not be held
to affect any other provision hereof.
(a) If a court of competent jurisdiction finds that the
provisions of this article and of article fifteen-b of this chapter
conflict and cannot be harmonized, then the provisions of article fifteen-b shall control.
(b) If any section, subsection, subdivision, paragraph,
sentence, clause or phrase of this article causes article nine-b of
this chapter to no longer constitute a qualifying or model statute,
as those terms are defined in the master settlement agreement, then
that portion of this article shall not be valid.
(c) If any section, subsection, subdivision, paragraph,
sentence, clause or phrase of this article is for any reason held
to be invalid, unlawful or unconstitutional, that decision does not
affect the validity of the remaining portions of this article or
any part thereof.
§11-15A-29. Effective date.
(a) The provisions of this article as amended or added by
Senate Bill No. 1 took effect on the first day of March, one
thousand nine hundred eighty-nine, and apply to all purchases made
or used in this state on or after that date: Provided, That if an
effective date was expressly provided in a provision of such act,
that specific effective date controlled in lieu of this general
effective date provision.
(b) The provisions of this article as amended or added by this
act shall take effect on the first day of July, one thousand nine
hundred eighty-nine, and apply to all purchases made or used in
this state on or after that date: Provided, That if an effective
date is expressly provided in such provision, that specific effective date shall control in lieu of this general effective date
provision. The provisions of this article, as amended or added
during the regular legislative session in the year two thousand
three, shall take effect the first day of January, two thousand
four, and apply to all sales made on or after that date and to all
returns and payments due on or after that day.
ARTICLE 15B. STREAMLINED SALES AND USE TAX ADMINISTRATION ACT.
§11-15B-1. Title.
The provisions of this article shall be known as and referred
to as the "Simplified "Streamlined Sales and Use Tax Administration
Act."
§11-15B-2. Definitions.
As used in this article: (a) General. -- When used in this
article and articles fifteen and fifteen-a of this chapter, words
defined in subsection (b) of this section shall have the meanings
ascribed to them in this section, except in those instances where
a different meaning is distinctly expressed or the context in which
the term is used clearly indicates that a different meaning is
intended by the Legislature.
(b) Terms defined. --
(1) "Agent" means a person appointed by a seller to represent
the seller before the member states.
(1)(2) "Agreement" means the streamlined sales and use tax
agreement, as defined in section two-a of this article.
(3) "Alcoholic beverages" means beverages that are suitable
for human consumption and contain one-half of one percent or more
of alcohol by volume.
(2)(4) "Certified automated system" or "CAS" means software
certified jointly by the states that are signatories to under the
agreement to calculate the tax imposed by each jurisdiction on a
transaction, determine the amount of tax to remit to the
appropriate state, and maintain a record of the transaction.
(3)(5) "Certified service provider" or "CSP" means an agent
certified jointly by the states that are signatories to under the
agreement to perform all of the seller's sales tax functions.
(6) "Computer" means an electronic device that accepts
information in digital or similar form and manipulates it for a
result based on a sequence of instructions.
(7) "Computer software" means a set of coded instructions
designed to cause a "computer" or automatic data processing
equipment to perform a task.
(8) "Delivered electronically" means delivered to the
purchaser by means other than tangible storage media.
(9) "Delivery charges" means charges by the seller of personal
property or services for preparation and delivery to a location
designated by the purchaser of personal property or services
including, but not limited to, transportation, shipping, postage,
handling, crating, and packing.
(10) "Dietary supplement" means any product, other than
"tobacco," intended to supplement the diet that:
(A) Contains one or more of the following dietary ingredients:
(i) A vitamin;
(ii) A mineral;
(iii) A herb or other botanical;
(iv) An amino acid;
(v) A dietary substance for use by humans to supplement the
diet by increasing the total dietary intake; or
(vi) A concentrate, metabolite, constituent, extract or
combination of any ingredient described in paragraph (A) of this
subdivision (10); and
(B) Is intended for ingestion in tablet, capsule, powder,
softgel, gelcap, or liquid form, or if not intended for ingestion
in such a form, is not represented as conventional food and is not
represented for use as a sole item of a meal or of the diet; and
(C) Is required to be labeled as a dietary supplement,
identifiable by the "Supplemental Facts" box found on the label and
as required pursuant to 21 C.F.R §101.36, or in any successor
section of the code of federal regulations.
(11) "Direct mail" means printed material delivered or
distributed by United States mail or other delivery service to a
mass audience or to addressees on a mailing list provided by the
purchaser or at the direction of the purchaser when the cost of the items are not billed directly to the recipients. "Direct mail"
includes tangible personal property supplied directly or indirectly
by the purchaser to the direct mail seller for inclusion in the
package containing the printed material. "Direct mail" does not
include multiple items of printed material delivered to a single
address.
(12)
"Drug"
means a compound, substance or preparation, and
any component of a compound, substance or preparation, other than
food and food ingredients, dietary supplements or alcoholic
beverages:
(A) Recognized in the official United States pharmacopoeia,
official homeopathic pharmacopoeia of the United States, or
official national formulary, and supplement to any of them; or
(B) Intended for use in the diagnosis, cure, mitigation,
treatment, or prevention of disease in humans; or
(C) Intended to affect the structure or any function of the
human body.
(13) "Durable medical equipment" means equipment including
repair and replacement parts for the same, but does not include
"mobility enhancing equipment," which:
(A) Can withstand repeated use; and
(B) Is primarily and customarily used to serve a medical
purpose; and
(C) Generally is not useful to a person in the absence of
illness or injury; and (4) Is not worn in or on the body.
(14) "Electronic" means relating to technology having
electrical, digital, magnetic, wireless, optical, electromagnetic,
or similar capabilities.
(15) "Entity-based exemption" means an exemption based on who
purchases the product or service or who sells the product or
service.
(16) "Food and food ingredients" means substances, whether in
liquid, concentrated, solid, frozen, dried or dehydrated form, that
are sold for ingestion or chewing by humans and are consumed for
their taste or nutritional value. "Food and food ingredients" does
not include alcoholic beverages or tobacco.
(17) "Includes" and "including" when used in a definition
contained in this article may not be considered to exclude other
things otherwise within the meaning of the term being defined.
(18) "Lease" includes rental, hire and license. "Lease" means
any transfer of possession or control of tangible personal property
for a fixed or indeterminate term for consideration. A lease or
rental may include future options to purchase or extend.
(A) "Lease" does not include:
(i) A transfer of possession or control of property under a
security agreement or deferred payment plan that requires the
transfer of title upon completion of the required payments;
(ii) A transfer or possession or control of property under an
agreement that requires the transfer of title upon completion of
required payments and payment of an option price does not exceed
the greater of one hundred dollars or one percent of the total
required payments; or
(iii) Providing tangible personal property along with an
operator for a fixed or indeterminate period of time. A condition
of this exclusion is that the operator is necessary for the
equipment to perform as designed. For the purpose of this
subparagraph (iii), an operator must do more than maintain,
inspect, or set-up the tangible personal property.
(B) This definition shall be used for sales and use tax
purposes regardless if a transaction is characterized as a lease or
rental under generally accepted accounting principles, the Internal
Revenue Code, the uniform commercial code, or other provisions of
federal, state or local law.
(19) "Load and leave" means delivery to the purchaser by use
of a tangible storage media where the tangible storage media is not
physically transferred to the purchaser.
(20)
"Mobility enhancing equipment"
means equipment, including
repair and replacement parts to the equipment, but does not include
"durable medical equipment," which:
(A) Is primarily and customarily used to provide or increase
the ability to move from one place to another and which is
appropriate for use either in a home or a motor vehicle; and
(B)Is not generally used by persons with normal mobility; and
(C) Does not include any motor vehicle or equipment on a motor
vehicle normally provided by a motor vehicle manufacturer.
(21) "Model I seller" means a seller that has selected a
certified service provider as its agent to perform all the seller's
sales and use tax functions, other than the seller's obligation to
remit tax on its own purchases.
(22) "Model II seller" means a seller that has selected a
certified automated system to perform part of its sales and use tax
functions, but retains responsibility for remitting the tax.
(23) "Model III seller" means a seller that has sales in at
least five member states, has total annual sales revenue of at
least five hundred million dollars, has a proprietary system that
calculates the amount of tax due each jurisdiction, and has entered
into a performance agreement with the member states that
establishes a tax performance standard for the seller. As used in
this definition, a seller includes an affiliated group of sellers
using the same proprietary system.
(4)(24) "Person" means an individual, trust, estate,
fiduciary, partnership, limited liability company, limited
liability partnership, corporation or any other legal entity.
(25) "Personal service" includes those:
(A) Compensated by the payment of wages in the ordinary course
of employment; and
(B) Rendered to the person of an individual without, at the
same time, selling tangible personal property, such as nursing,
barbering, manicuring and similar services.
(26) "Prescription" means an order, formula or recipe issued
in any form of oral, written, electronic, or other means of
transmission by a duly licensed practitioner authorized by the laws
of this state to issue prescriptions.
(27) "Prewritten computer software" means "computer software,"
including prewritten upgrades, which is not designed and developed
by the author or other creator to the specifications of a specific
purchaser.
(A) The combining of two or more prewritten computer software
programs or prewritten portions thereof does not cause the
combination to be other than prewritten computer software.
(B) "Prewritten computer software" includes software designed
and developed by the author or other creator to the specifications
of a specific purchaser when it is sold to a person other than the
purchaser. Where a person modifies or enhances computer software
of which the person is not the author or creator, the person is
considered to be the author or creator only of such person's
modifications or enhancements.
(C) "Prewritten computer software" or a prewritten portion
thereof that is modified or enhanced to any degree, where such
modification or enhancement is designed and developed to the
specifications of a specific purchaser, remains prewritten computer
software: Provided, That where there is a reasonable, separately
stated charge or an invoice or other statement of the price given
to the purchaser for such modification or enhancement, such
modification or enhancement does not constitute prewritten computer
software.
(28) "Product-based exemption" means an exemption based on the
description of the product or service and not based on who
purchases the product or service or how the purchaser intends to
use the product or service.
(29) "Prosthetic device" means a replacement, corrective, or
supportive device including repair and replacement parts for same
worn on or in the body to:
(A) Artificially replace a missing portion of the body;
(B) Prevent or correct physical deformity or malfunction; or
(C) Support a weak or deformed portion of the body.
(30) "Protective equipment" means items for human wear and
designed as protection of the wearer against injury or disease or
as protections against damage or injury of other persons or
property but not suitable for general use.
(31) "Purchase price" means the measure subject to the tax
imposed by this article or article fifteen-a of this chapter and
has the same meaning as sales price.
(32) "Purchaser" means a person to whom a sale of personal
property is made or to whom a service is furnished.
(33) "Registered under this agreement" means registration by
a seller with the member states under the central registration
system provided in article IV of the agreement.
(34) "Retail sale" or "sale at retail" means:
(A) Any sale or lease for any purpose other than for resale as
tangible personal property, sublease, or subrent, and
(B) any sale of a service other than a service purchased for
resale.
(35) "Sales price."
(A) "Sales price" means the measure subject to the tax levied
by this article and includes the total amount of consideration,
including cash, credit, property and services, for which personal
property or services are sold, leased or rented, valued in money,
whether received in money or otherwise, without any deduction for
the following:
(i) The seller's cost of the property sold;
(ii) The cost of materials used, labor or service cost,
interest, losses, all costs of transportation to the seller, all
taxes imposed on the seller, and any other expense of the seller;
(iii) Charges by the seller for any services necessary to
complete the sale, other than delivery and installation charges;
(iv) Delivery charges;
(v) Installation charges;
(vi) The value of exempt personal property given to the
purchaser where taxable and exempt personal property have been
bundled together and sold by the seller as a single product or
piece of merchandise; and
(vii) Credit for the fair market value of any trade-in.
(B) "Sales price" does not include:
(i) Discounts, including cash, term, or coupons that are not
reimbursed by a third party that are allowed by a seller and taken
by a purchaser on a sale;
(ii) Interest, financing, and carrying charges from credit
extended on the sale of personal property, goods or services, if
the amount is separately stated on the invoice, bill of sale or
similar document given to the purchaser; and
(iii) Any taxes legally imposed directly on the consumer that
are separately stated on the invoice, bill of sale or similar
document given to the purchaser.
(5)(36) "Sales tax" means the tax levied under article fifteen
of this chapter.
(6)(37) "Seller" means any person making sales, leases or
rentals of personal property or services.
(38) "Service" or "selected service" includes all
nonprofessional activities engaged in for other persons for a
consideration, which involve the rendering of a service as
distinguished from the sale of tangible personal property, but does
not include contracting, personal services, services rendered by an
employee to his or her employer, any service rendered for resale,
or any service furnished by a business that is subject to the
control of the public service commission when the service or the
manner in which it is delivered is subject to regulation by the
public service commission of this state.
(7)(39) "State" means any state of the United States and the
District of Columbia.
(40) "Tangible personal property" means personal property that
can be seen, weighed, measured, felt, or touched, or that is in any
manner perceptible to the senses. "Tangible personal property"
includes, but is not limited to, electricity, water, gas, and
prewritten computer software.
(41) "Tax" includes all taxes levied under articles fifteen
and fifteen-a of this chapter, and additions to tax, interest and
penalties levied under article ten of this chapter.
(42) "Tax commissioner" means the state tax commissioner or
his or her delegate. The term "delegate" in the phrase "or his or
her delegate," when used in reference to the tax commissioner,
means any officer or employee of the state tax division duly authorized by the tax commissioner directly, or indirectly by one
or more redelegations of authority, to perform the functions
mentioned or described in this article or rules promulgated for
this article.
(43) "Taxpayer" means any person liable for the taxes levied
by articles fifteen and fifteen-a of this chapter or any additions
to tax, penalties imposed by article ten of this chapter.
(44) "Tobacco" means cigarettes, cigars, chewing or pipe
tobacco, or any other item that contains tobacco.
(8)(45) "Use tax" means the tax levied under article fifteen-a
of this chapter.
(46) "Use based exemption" means an exemption based on the
purchaser's use of the product or service.
(47) "Vendor" means any person furnishing services taxed by
article fifteen or fifteen-a of this chapter, or making sales of
tangible personal property or custom software. "Vendor" and
"seller" are used interchangeably in this article and in article
fifteen and fifteen-a of this chapter.
(c) Additional definitions. -- Other terms used in this
article are defined in articles fifteen and fifteen-a of this
chapter, which definitions are incorporated by reference into
article fifteen-b. Additionally, other sections of this article
may define terms primarily used in the section in which the term is
defined.
§11-15B-2a. Streamlined sales and use tax agreement defined.
As used in this article and articles fifteen and fifteen-a of
this chapter, the term "streamlined sales and use tax agreement" or
"agreement" means the agreement adopted the twelfth day of
November, two thousand two, by states that enacted authority to
engage in multistate discussions similar to that provided in
section four of this article, except when the context in which the
term is used clearly indicates that a different meaning is intended
by the Legislature. "Agreement" does not include any substantive
changes in the agreement adopted after the Legislature enacts this
section in the year two thousand three.
§11-15B-3. Legislative findings.
(a) The Legislature finds that a simplified streamlined sales
and use tax administration system will reduce and over time
eliminate the burden and cost for all vendors to collect this
state's sales and use tax. The Legislature further finds that this
state should participate in multistate discussions to review and/or
amend the terms of the agreement to simplify and modernize sales
and use tax administration in order to substantially reduce the
burden of tax compliance for all sellers and for all types of
commerce.
(b) The Legislature finds that the streamlined sales and use
tax agreement adopted the twelfth day of November, two thousand
two, by representatives of the states participating in multistate discussions to amend and implement the agreement substantially
complies with the requirements of section seven of this article, as
enacted in the year two thousand two, and that this state should
now sign the agreement.
§11-15B-5. Authority to enter agreement.
Subject to approval of the Legislature, by concurrent
resolution or general law, the
(a) The tax commissioner is authorized and directed to enter
into the streamlined sales and use tax agreement, after the
thirtieth day of June, two thousand three, with one or more states
to simplify and modernize sales and use tax administration in order
to substantially reduce the burden of tax compliance for all
sellers and for all types of commerce.
(b) In furtherance of the agreement, the tax commissioner is
authorized to act jointly with other states that are members of the
agreement to establish standards for certification of a certified
service provider and certified automated system and establish
performance standards for multistate sellers. The tax commissioner
is further authorized to take other actions reasonably required to
implement the provisions set forth in this article. Other actions
authorized by this section include, but are not limited to, the
adoption of rules and the joint procurement, with other member
states, of goods and services in furtherance of the cooperative
agreement. The tax commissioner or the commissioner's designee is authorized to represent this state before the other states that are
signatories to the agreement.
§11-15B-11. Seller registration under streamlined sales tax
agreement.
(a) General. -- A seller that registers to collect West
Virginia sales and use taxes using the online sales and use tax
registration system established under the streamlined sales and use
tax agreement is not required to also register under article twelve
of this chapter unless the seller has sufficient presence in this
state that provides at least the minimum contacts necessary for a
constitutionally sufficient nexus for this state to require
registration and payment of the registration tax under article
twelve of this chapter.
(b) Registration by agent. -- A person appointed by a seller
to represent the seller before the states that are members of the
streamlined sales tax agreement may register a seller under the
agreement under uniform procedures adopted by the member states.
The appointment of an agent shall be in writing and submitted to a
member state if requested by the member.
(c) Cancellation of registration. -- A seller registered under
the streamlined sales and use tax agreement may cancel its
registration at any time under uniform procedures adopted by the
member states.
§11-15B-12. Effect of seller registration and participation in
streamlined sales and use tax administration.
(a) Collection of tax. -- By registering under the streamlined
sales use tax agreement, the seller agrees to collect and remit
sales and use taxes for all taxable sales into this state, as well
as for all other states participating in the agreement. Subsequent
withdrawal or revocation of a member state does not relieve a
seller of its responsibility to remit taxes previously or
subsequently collected on behalf of the state.
(b) Effect of registration. -- A member state, or a state that
has withdrawn or been expelled from the streamlined sales and use
tax agreement, may not use registration with the central
registration system and the collection of sales and use taxes in
the member states as a factor in determining whether the seller has
a nexus with that state for any tax at any time.
§11-15B-13. Amnesty for registration.
(a) Subject to the limitations in this section:
(1) The tax commissioner shall provide amnesty for uncollected
or unpaid sales or use tax to a seller who registers to pay or to
collect and remit applicable sales or use tax on sales made to
purchasers in this state in accordance with the terms of the
streamlined sales and use tax agreement: Provided, That the seller
was not registered in this state in the twelve-month period preceding the effective date of this state's participation in the
streamlined sales and use tax agreement.
(2) The amnesty shall preclude assessment for uncollected or
unpaid sales or use tax together with additions to tax, penalty or
interest for sales made during the period the seller was not
registered in this state: Provided, That registration under the
agreement occurs within twelve months after the effective date of
this state's participation in the streamlined sales and use tax
agreement.
(b) Exceptions. -- The amnesty is not available:
(1) To a seller with respect to any matter or matters for
which the seller received notice of the commencement of an audit
and which audit is not yet finally resolved including any related
administrative and judicial processes; or
(2) For sales or use taxes already paid or remitted to the
state or to taxes collected by the seller for this state.
(c) Period of amnesty. -- The amnesty is fully effective,
absent the seller's fraud or intentional misrepresentation of a
material fact, as long as the seller continues registration under
the agreement and continues payment or collection and remittance of
applicable sales or use taxes for a period of at least thirty-six
months. The statute of limitations applicable to asserting a tax
liability during this thirty-six month period shall be tolled.
(d) Effect of amnesty. -- The amnesty is applicable only to
sales or use taxes due from a seller in its capacity as a seller
and not to sales or use taxes due from a seller in its capacity as
a buyer.
§11-15B-14. General transaction sourcing definitions.
(a) Definition of receive or receipt. -- For the purposes of
subsection (a), section fifteen of this article, the terms
"receive" and "receipt" mean:
(1) Taking possession of tangible personal property;
(2) Making first use of services; or
(3) Taking possession or making first use of custom software,
whichever comes first.
(b) Limitation. -- The terms "receive" and "receipt" do not
include possession by a shipping company on behalf of the
purchaser.
§11-15B-15. General transaction sourcing rules.
(a) General rule. -- For purposes of articles fifteen and
fifteen-a of this chapter, the retail sale, excluding lease or
rental, of a product shall be sourced as follows:
(1) When the product is received by the purchaser at a
business location of the seller, the sale is sourced to that
business location.
(2) When the product is not received by the purchaser at a
business location of the seller, the sale is sourced to the location where receipt by the purchaser (or the purchaser's donee,
designated as such by the purchaser) occurs, including the location
indicated by instructions for delivery to the purchaser (or donee),
known to the seller.
(3) When subdivisions (1) and (2) of this subsection (a) do
not apply, the sale is sourced to the location indicated by an
address for the purchaser that is available from the business
records of the seller that are maintained in the ordinary course of
the seller's business when use of this address does not constitute
bad faith.
(4) When subdivisions (1), (2), and (3) of this subsection (a)
do not apply, the sale is sourced to the location indicated by an
address for the purchaser obtained during the consummation of the
sale, including the address of a purchaser's payment instrument, if
no other address is available, provided use of this address does
not constitute bad faith.
(5) When none of the previous subdivisions of this subsection
(a) apply, including the circumstance in which the seller is
without sufficient information to apply the previous rules, then
the location will be determined by the address from which tangible
personal property was shipped, or computer software delivered
electronically was first available for transmission by the seller,
or from which the service was provided (disregarding for these purposes any location that merely provided the digital transfer of
the product sold).
(b) Lease or rental. -- The lease or rental of tangible
personal property, other than property identified in subsection (c)
or subsection (d) of this section, shall be sourced as follows:
(1) For a lease or rental that requires recurring periodic
payments, the first periodic payment is sourced the same as a
retail sale in accordance with the provisions of subsection (a) of
this section. Periodic payments made subsequent to the first
payment are sourced to the primary property location for each
period covered by the payment. The primary property location shall
be as indicated by an address for the property provided by the
lessee that is available to the lessor from its records maintained
in the ordinary course of business, when use of this address does
not constitute bad faith. The property location may not be altered
by intermittent use at different locations, such as use of business
property that accompanies employees on business trips and service
calls.
(2) For a lease or rental that does not require recurring
periodic payments, the payment is sourced the same as a retail sale
in accordance with the provisions of subsection (a) of this
section.
(3) This subsection does not affect the imposition or
computation of sales or use tax on leases or rentals based on a lump sum or accelerated basis, or on the acquisition of property
for lease.
(c) Vehicles. -- The lease or rental of motor vehicles,
trailers, semi-trailers, or aircraft that do not qualify as
transportation equipment, as defined in subsection (d) of this
section, shall be sourced as follows:
(1)For a lease or rental that requires recurring periodic
payments, each periodic payment is sourced to the primary property
location. The primary property location shall be as indicated by
an address for the property provided by the lessee that is
available to the lessor from its records maintained in the ordinary
course of business, when use of this address does not constitute
bad faith. This location shall not be altered by intermittent use
at different locations.
(2) For a lease or rental that does not require recurring
periodic payments, the payment is sourced the same as a retail sale
in accordance with the provisions of subsection (a) of this
section.
(3) This subsection does not affect the imposition or
computation of sales or use tax on leases or rentals based on a
lump sum or accelerated basis, or on the acquisition of property
for lease.
(d) Sale or lease or rental of transportation equipment. --
The retail sale, including lease or rental, of transportation equipment shall be sourced the same as a retail sale in accordance
with the provisions of subsection (a) of this section,
notwithstanding the exclusion of lease or rental in subsection (a).
"Transportation equipment" means any of the following:
(1) Locomotives and railcars that are utilized for the
carriage of persons or property in interstate commerce.
(2) Trucks and truck-tractors with a gross vehicle weight
rating (GVWR) of ten thousand pounds or greater, trailers,
semitrailers, or passenger buses that are:
(A) Registered through the international registration plan;
and
(B) Operated under authority of a carrier authorized and
certificated by the United States department of transportation or
another federal authority to engage in the carriage of persons or
property in interstate commerce.
(3) Aircraft that are operated by air carriers authorized and
certificated by the U.S. department of transportation or another
federal or foreign authority to engage in the carriage of persons
or property in interstate or foreign commerce.
(4) Containers designed for use on and component parts
attached or secured on the items set forth in subsections (1)
through (3) of this subsection.
§11-15B-16. Application of general sourcing rule and exclusions
from the rules.
(a) General. -- Sellers who collect the taxes levied by
articles fifteen and fifteen-a of this chapter shall source the
retail sale of a product, as provided in section fifteen of this
article. As used in this section, the term "product" includes
tangible personal property, custom software or a service, or any
combination of the preceding.
(b) Scope of sourcing rule. -- The provisions of section
fifteen of this article only apply to determine a seller's
obligation to pay or collect and remit a sales or use tax with
respect to the seller's retail sale of a product. Section fifteen
of this article does not affect the obligation of a purchaser or
lessee to remit tax on the use of the product to the taxing
jurisdiction of that use.
(c) Exceptions. -- The sourcing rules in this section and
section fifteen of this article do not apply to telecommunications
services.
§11-15B-17. Direct mail sourcing.
(a) General. -- Notwithstanding section fifteen of this
article, a purchaser of direct mail that is not a holder of a
direct pay permit shall provide to the seller in conjunction with
the purchase either a "direct mail form" or information to show the
jurisdictions to which the direct mail is delivered to recipients.
(1) Upon receipt of the direct mail form, the seller is
relieved of all obligations to collect, pay, or remit the applicable tax and the purchaser is obligated to pay or remit the
applicable tax on a direct pay basis. A direct mail form shall
remain in effect for all future sales of direct mail by the seller
to the purchaser until it is revoked in writing.
(2) Upon receipt of information from the purchaser showing the
jurisdictions to which the direct mail is delivered to recipients,
the seller shall collect the tax according to the delivery
information provided by the purchaser. In the absence of bad faith
by the seller, the seller is relieved of any further obligation to
collect tax on any transaction where the seller has collected tax
pursuant to the delivery information provided by the purchaser.
(b) When purchaser does not have direct pay permit and does
not provide direct mail form. -- If the purchaser of direct mail
does not have a direct pay permit and does not provide the seller
with either a direct mail form or delivery information, as required
by subsection (a) of this section, the seller shall collect the tax
according to subdivision (5), subsection (a), section fourteen of
this article. Nothing in this subsection (b) shall limit a
purchaser's obligation for sales or use tax to any state to which
the direct mail is delivered.
(c) Direct pay permit. -- If a purchaser of direct mail
provides the seller with documentation of direct pay authority, the
purchaser may not be required to provide a direct mail form or
delivery information to the seller.
§11-15B-18. Multiple points of use of certain products and
services.
(a) General. -- Notwithstanding the provisions of section
fifteen of this article, a business purchaser that is not a holder
of a direct pay permit that knows at the time of its purchase of a
digital good, computer software delivered electronically, or a
service that the digital good, computer software delivered
electronically, or service will be concurrently available for use
in more than one jurisdiction shall deliver to the seller in
conjunction with its purchase a "multiple points of use" or "MPU
exemption" form disclosing this fact.
(1) Upon receipt of the MPU exemption form, the seller is
relieved of all obligation to collect, pay, or remit the applicable
tax and the purchaser shall be obligated to collect, pay, or remit
the applicable tax on a direct pay basis.
(2) A purchaser delivering the MPU exemption form may use any
reasonable, but consistent and uniform, method of apportionment
that is supported by the purchaser's business records as they exist
at the time of the consummation of the sale.
(3) The MPU exemption form shall remain in effect for all
future sales by the seller to the purchaser (except as to the
subsequent sale's specific apportionment that is governed by the
principle of subdivision (2) of this subsection and the facts
existing at the time of the sale) until it is revoked in writing.
(b) Holders of direct pay permits. -- A holder of a direct pay
permit may not be required to deliver a MPU exemption form to the
seller. A direct pay permit holder shall follow the provisions of
subdivision (2), subsection (a) of this section in apportioning the
tax due on a digital good, computer software delivered
electronically, or a service that will be concurrently available
for use in more than one jurisdiction.
[§11-15B-19 and §11-15B-20 Reserved.]
§11-15B-21. Notice for state tax changes.
(a) General. -- The tax commissioner shall provide sellers
with as much advance notice as practicable of a rate change for a
tax levied by article fifteen or fifteen-a of this chapter.
(b) Effective date of rate changes. -- Unless the Legislature
expressly provides a different effective date for a rate change,
the change shall take effect on the first day of the calendar
quarter that begins on or after the effective date of the act of
the Legislature that makes the rate change and that is more than
sixty days after passage of the bill making the rate change.
(c) Notification of changes to tax base. -- The tax
commissioner shall make reasonable efforts to notify sellers of
legislative changes to the tax base and to amendments to sales and
use tax rules, as that term is defined in section two, article one,
chapter twenty-nine-a of this code.
(d) Liability of seller. -- Failure of a seller to receive
notice or failure of the state to provide notice of a rate change
or a change in the tax base, or to limit the effective date of a
rate change, does not relieve the seller of its obligation to
collect sales or use taxes for this state.
§11-15B-22. Effective date of rate changes for certain services.
The effective date of rate changes for services covering a
service period starting before and ending after the statutory
effective date shall be as follows:
(1) For a rate increase, the new rate shall apply to the first
billing period starting on or after the effective date.
(2) For a rate decrease, the new rate shall apply to bills
rendered on or after the effective date.
§11-15B-23. Enactment of exemptions.
(a) Product-based exemptions. -- The Legislature may enact a
product-based exemption from the taxes levied by article fifteen
and fifteen-a of this chapter without restriction if the
streamlined sales and use tax agreement does not have a definition
for the product or for a term that includes the product. If the
agreement has a definition for the product or for a term that
includes the product, the Legislature may exempt all items included
within the definition but may not exempt only part of the items
included within the definition, unless the streamlined sales and use tax agreement sets out the exemption for part of the items as
an acceptable variation.
(b) Entity-based or use-based exemption. -- The Legislature
may enact an entity-based or use-based exemption from a tax levied
by article fifteen or fifteen-a of this chapter without restriction
if the streamlined sales and use tax agreement does not have a
definition for the product whose use or purchase by a specific
entity is exempt or for a term that includes the product. If the
agreement has a definition for the product whose use or specific
purchase is exempt, the Legislature may enact an entity-based or
use-based exemption that applies to that product, as long as the
exemption utilizes the streamline sales and use tax agreement
definition of the product. If the agreement does not have a
definition for the product whose use or specific purchase is exempt
but has a definition for a term that includes the product, the
Legislature may enact an entity-based or use-based exemption for
the product without restriction.
(c) Construction. -- For purposes of complying with the
requirements in this section, the inclusion of a product within the
definition of tangible personal property is disregarded.
§11-15B-24. Administration of exemptions.
(a) General. -- When a purchaser claims an exemption under
article fifteen or fifteen-a of this chapter:
(1) A seller registered under the streamlined sales and use
tax agreement shall obtain identifying information of the purchaser
and the reason for claiming a tax exemption at the time of the
purchase, as determined by the governing board established pursuant
to the agreement. A seller not registered under the agreement
shall obtain identifying information of the purchaser and the
reason for claiming a tax exemption at the time of purchase, as
determined by the tax commissioner.
(2) A purchaser is not required to provide a signature to
claim an exemption from tax unless a paper exemption certificate is
used.
(3) The seller shall use the standard form for claiming an
exemption electronically that is adopted by the governing board
administering the streamlined sales and use tax agreement.
(4) The seller shall obtain the same information for proof of
a claimed exemption regardless of the medium in which the
transaction occurred.
(5) The tax commissioner may utilize a system wherein the
purchaser exempt from the payment of the tax is issued an
identification number that shall be presented to the seller at the
time of the sale.
(6) The seller shall maintain proper records of exempt
transactions and provide them to the tax commissioner or the tax
commissioner's designee.
(7) The tax commissioner shall administer use-based and
entity-based exemptions when practicable through a direct pay
permit, an exemption certificate, or another means that does not
burden sellers.
(8) The tax commissioner shall relieve sellers registered
under the streamlined sales and use tax agreement that follow the
requirements of this section from any tax otherwise applicable if
it is determined that the purchaser improperly claimed an exemption
and hold the purchaser liable for the nonpayment of tax. This
relief from liability does not apply to a seller who fraudulently
fails to collect the tax or solicits purchasers to participate in
the unlawful claim of an exemption.
§11-15B-25. Uniform tax returns.
(a) General. -- A seller who registers with this state under
the streamlined sales tax agreement is required to file one
sales/use tax return with the tax commissioner for each taxing
period.
(b) Due date of return. -- This return shall be due on the
twentieth day of the month following the month in which the
transaction subject to tax occurred.
(c) Additional information returns. -- The tax commissioner
shall allow any Model I, Model II, or Model III seller to
submit its sales and use tax returns in a simplified format that
does not include more data fields than permitted by the governing board administering the streamlined sales and use tax agreement.
The tax commissioner may require additional informational returns
to be submitted not more frequently than every six months under a
staggered system developed by the governing board administering the
streamlined sales and use tax agreement.
(d) The tax commissioner shall allow any seller that is
registered with this state under the streamlined sales and use tax
agreement, which does not have a legal requirement to register in
this state under article twelve of this chapter, and is not a Model
I, II, or III seller, to submit its sales and use tax returns as
follows:
(1) Upon registration, the tax commissioner shall provide to
the seller the returns required by this state.
(2) The tax commissioner may require a seller to file a return
anytime within one year of the month of initial registration, and
future returns may be required on an annual basis in succeeding
years.
(3) In addition to the returns required in subdivision (2) of
this subsection (d), a seller shall submit a return by the
twentieth day of the month following any month in which the seller
accumulated state and local tax funds for the state in the amount
of one thousand dollars or more.
(4) The tax commissioner shall participate with other states
that are members of the streamlined sales and use tax agreement in developing a more uniform sales and use tax return that, when
completed, shall be available to all sellers.
(5) All Model I, II, and III sellers shall file returns
electronically after the first day of January, two thousand four.
§11-15B-26. Uniform rules for remittances of funds.
(a) General. -- Only one remittance shall be required for each
return except as provided in this section.
(b) When electronic remittance required. -- All remittances
from sellers under Models I, II, and III shall be remitted
electronically after the thirtieth day of June, two thousand three.
(c) Method of remittance. -- Electronic payments shall be made
using either the ACH credit or ACH debit method.
(d) Alternative method. -- The tax commission shall provide by
rule, which may be an existing rule, an alternative method for
making "same day" payments if an electronic funds transfer fails.
(e) Format of data accompany remittance. -- Any data that
accompanies a remittance shall be formatted using uniform tax type
and payment type codes approved by the governing board
administering the streamlined sales and use tax agreement.
§11-15B-27. Uniform rules for recovery of bad debt.
(a) General. -- A deduction from taxable sales shall be
allowed for bad debts. Any deduction taken that is attributed to
bad debts may not include interest or any amount upon which the
sales or use tax imposed by this state was not previously paid.
(b) "Bad debt" defined. -- The term "bad debt" has the same
meaning as when used in the federal definition of "bad debt" in 26
U.S.C. Sec. 166 as the basis for calculating bad debt recovery.
However, the amount calculated pursuant to 26 U.S.C. Sec. 166 shall
be adjusted to exclude:
(1) Financing charges or interest;
(2) Sales or use taxes charged on the purchase price;
(3) Uncollectible amounts on property that remain in the
possession of the seller until the full purchase price is paid;
(4) Expenses incurred in attempting to collect any debt; and
(5) Repossessed property.
(c) When deduction may be taken. -- Bad debts may be deducted
on the return for the period during which the bad debt is written
off as uncollectible in the claimant's books and records and is
eligible to be deducted for federal income tax purposes. For
purposes of this section, a claimant who is not required to file
federal income tax returns may deduct a bad debt on a return filed
for the period in which the bad debt is written off as
uncollectible in the claimant's books and records and would be
eligible for a bad debt deduction for federal income tax purposes
if the claimant was required to file a federal income tax return.
(d) Subsequent recovery. -- If a deduction is taken for a bad
debt and the debt is subsequently collected, in whole or in part, the tax on the amount so collected shall be paid and reported on
the return filed for the period in which the collection is made.
(e) When bad debt deduction exceeds taxable sales. -- When the
amount of bad debt exceeds the amount of taxable sales for the
period during which the bad debt is written off, a refund claim may
be filed within the period specified in section fourteen, article
ten of this chapter, for filing a claim for refund or sales or use
tax, except that the statute of limitations shall be measured from
the due date of the return on which the bad debt could first be
claimed.
(f) When certified service provider is used. -- Where filing
responsibilities of the seller have been assumed by a certified
service provider, the certified service provider may claim, on
behalf of the seller, any bad debt allowance provided by this
section. The certified service provider shall credit or refund to
the seller the full amount of any bad debt allowance or refund
received under this section.
(g) Reporting of payment received on previously claimed bad
debt. -- For the purposes of reporting a payment received on a
previously claimed bad debt, any payments made on a debt or account
shall be applied first proportionally to the taxable price of the
property or service and the sales tax thereon, and secondly to
interest, service charges, and any other charges.
(h) Allocation. -- In situations where the books and records
of the party claiming the bad debt allowance support an allocation
of the bad debts among two or more states that are members of the
streamlined sales and use tax agreement, the allocation shall be
permitted.
§11-15B-28. Confidentiality and privacy protections under Model I.
(a) Purpose. -- The purpose of this section is to set forth
the policy of this state for the protection of the confidentiality
rights of all participants in the streamlined sales and use tax
administration and collection system and of the privacy interests
of consumers who deal with Model I sellers.
(b) Certain terms defined. -- As used in this section:
(1) The term "confidential taxpayer information" means all
information that is protected under section five-d, article ten of
this chapter;
(2) The term "personally identifiable information" means
information that identifies a person; and
(3) The term "anonymous data" means information that does not
identify a person.
(c) Certified service providers. -- With very limited
exceptions, a certified service provider shall perform its tax
calculation, remittance, and reporting functions without retaining
the personally identifiable information of consumers.
(d) Certification of service providers. -- The governing board
administering the streamlined sales and used tax agreement may
certify a service provider only if that certified service provider
certifies that:
(1) Its system has been designed and tested to ensure that the
fundamental precept of anonymity is respected;
(2) That personally identifiable information is only used and
retained to the extent necessary for the administration of Model I
with respect to exempt purchasers;
(3) It provides consumers clear and conspicuous notice of its
information practices, including what information it collects, how
it collects the information, how it uses the information, how long,
if at all, it retains the information and whether it discloses the
information to member states. This notice shall be satisfied by a
written privacy policy statement accessible by the public on the
official web site of the certified service provider;
(4) Its collection, use and retention of personally
identifiable information is limited to that required by the states
that are members of the streamlined sales and use tax agreement to
ensure the validity of exemptions from taxation that are claimed by
reason of a consumer's status or the intended use of the goods or
services purchased; and
(5) It provides adequate technical, physical, and
administrative safeguards so as to protect personally identifiable
information from unauthorized access and disclosure.
(e) State notification of privacy policy. -- The tax
commissioner shall provide public notification to consumers,
including their exempt purchasers, of this state's practices
relating to the collection, use and retention of personally
identifiable information.
(f) Destruction of confidential information. -- When any
personally identifiable information that has been collected and
retained by the tax commissioner is no longer required for the
purposes set forth in subdivision (4), subsection (d) of this
section, the information shall no longer be retained by the tax
commissioner.
(g) Review and correction by individuals. -- When personally
identifiable information regarding an individual is retained by or
on behalf of the tax commissioner, the commissioner shall provide
reasonable access by an individual to his or her own information in
the commissioner's possession and a right to correct any
inaccurately recorded information.
(h) Discovery by other persons. -- If anyone other than the
individual, or a person authorized in writing by the individual,
seeks to discover personally identifiable information, the tax commissioner shall make a reasonable and timely effort to notify
the individual of the request.
(i) Enforcement. -- This privacy policy may be enforced by the
tax commissioner or the attorney general of this state.
(j) Service provider's confidentiality policy may be more
restrictive. -- This privacy policy does not preclude the governing
board administering the streamlined sales and use tax agreement
from certifying a certified service provider whose privacy policy
is more protective of confidential taxpayer information or
personally identifiable information than is required by the
agreement of the laws of this state.
§11-15B-29. Customer refund procedure.
(a) General. -- The customer refund procedures set forth in
this section apply when a purchaser seeks a return of
over-collected sales or use taxes from the seller.
(b) Applicability. -- These customer refund procedures provide
the first course of remedy available to purchasers seeking a return
of over-collected sales or use taxes from the seller. A cause of
action against the seller for the over-collected sales or use taxes
does not accrue until a purchaser has provided written notice to a
seller and the seller has had sixty days to respond. The notice to
the seller must contain the information necessary to determine the
validity of the request.
(c) Presumption of reasonable business practice. -- In
connection with a purchaser's request from a seller of
over-collected sales or use taxes, a seller shall be presumed to
have a reasonable business practice, if in the collection of the
sales or use taxes, the seller:
(1) Uses either a certified service provider or a certified
automated system, including a proprietary system, that is certified
by the state; and
(2) Has remitted to the state all taxes collected less any
allowable deductions, credits, or collection allowances.
(d) Statute of limitations. -- Nothing in this section shall
operate to extend any person's time to seek from the tax
commissioner a refund of sales or use taxes collected or remitted
by a seller in error.
§11-15B-30. Monetary allowances for new technological models for
sales tax collection; delayed effective date.
(a) Monetary allowance under Model I. --
(1) The tax commissioner shall provide a monetary allowance to
a certified service provider in Model I. This allowance shall be
in accordance with the terms of the contract between the governing
board of the streamlined sales and use tax agreement and the
certified service provider. The details of this monetary allowance
shall be developed and provided through the contract process. The contract shall provide that the allowance be funded entirely from
money collected in Model I.
(2) The contract between the governing board and the certified
service provider may base the monetary allowance to a certified
service provider on one or more of the following:
(A) A base rate that applies to taxable transactions processed
by the certified service provider; or
(B) For a period not to exceed twenty-four months following a
voluntary seller's registration through the agreement's central
registration process, a percentage of tax revenue generated for a
member state by the voluntary seller for each member state for
which the seller does not have a requirement to register to collect
the tax.
(b) Monetary allowance for Model II sellers. -- The monetary
allowance to sellers under Model II may be based on the following:
(1) All sellers shall receive a base rate for a period not to
exceed twenty-four months following the commencement of
participation by a seller. The base rate shall be set by the
governing board of the streamlined sales and use tax agreement
after the base rate has been established for Model I certified
service providers. This allowance shall be in addition to any
vendor or seller discount afforded by each member state at the
time.
(2) The monetary allowance to a Model II seller may be based
on the following:
(A) For a period not to exceed twenty-four months following a
voluntary seller's registration through the agreement's central
registration process, a percentage of tax revenue generated for a
member state by the voluntary seller for each member state for
which the seller does not have a requirement to register to collect
the tax; and
(B) Following the conclusion of the twenty-four month period,
a seller will only be entitled to a vendor discount afforded under
each member state's law at the time the base rate expires.
(c) Monetary allowance for Model III sellers and all other
sellers that are not under Models I or II. -- A monetary allowance
to sellers under Model III and to all other sellers that are not
under Models I or II may be allowed based on the following:
(1) For a period not to exceed twenty-four months following a
voluntary seller's registration through the agreement's central
registration process, a percentage of tax revenue generated for a
member state by the voluntary seller for each member state for
which the seller does not have a requirement to register to collect
the tax; and
(2) Vendor discounts afforded under each member state's law.
(d) Prohibition on allowance or payment of monetary
allowances. -- Notwithstanding subsections (a), (b) and (c) of this section, the tax commissioner may not allow any vendor, seller or
certified service provider any monetary allowance, discount or
other compensation for collecting and remitting the taxes levied by
articles fifteen and fifteen-a of this chapter, or for making and
filing the periodic reports required by this article, or articles
fifteen and fifteen-a of this chapter, until such time as this
section is amended by the Legislature.
(e) Findings and declarations. -- The Legislature finds that
the vendor cost of collection study was not completed for use by
the governing board of the streamlined sales and use tax agreement
or this Legislature before this Legislature was asked to authorize
the tax commissioner to sign the streamlined sales and use tax
agreement. Additionally, no preliminary findings or conclusions of
the study regarding vendor costs of collection are available upon
which the tax commissioner or the Legislature can reasonably
project the effect the payment of the monetary allowances provided
for in subsections (a) through (c) of this section will have on net
sales and use tax collections. Because the cost of allowing
monetary allowances under collection Models I through IV may reduce
net sales and use tax collections, at least in the early years of
the agreement, because many states including this state are
experiencing revenue shortfalls, and because the Legislature is
constitutionally required to pass a balanced budget, the
Legislature finds and declares that it is both reasonable and prudent to delay approving this aspect of the agreement until
adequate information does become available and the effect the
monetary allowances will have on West Virginia sales and use tax
collections can reasonably be quantified. The Legislature declares
its support for the streamlined sales and use tax agreement by
adopting in this enactment all substantive changes in West
Virginia's sales and use tax laws necessary for West Virginia's
sales and use tax laws to be in substantial compliance with the
streamlined sales and use tax agreement. Additionally, the
Legislature declares that it can quickly act to reconsider
subsection (d) of this section once the requisite information
becomes available.
§11-15B-31. Conflict; partial unconstitutionality.
(a) Conflict. -- If a court of competent jurisdiction finds
that the provisions of this article and of article fifteen-b of
this chapter conflict and cannot be harmonized, then the provisions
of article fifteen-b shall control.
(b) Severability. -- If any section, subsection, subdivision,
paragraph, sentence, clause or phrase of this article is for any
reason held to be invalid, unlawful or unconstitutional, that
decision does not affect the validity of the remaining portions of
this article or any part thereof.
§11-15B-32. Effective date.
The provisions of this article, as amended or added during the
regular legislative session in the year two thousand three, shall
take effect the first day of January, two thousand four, and apply
to all sales made on or after that date and to all returns and
payments due on or after that day, except as otherwise expressly
provided in this article.
NOTE: The purpose of this bill is: (a) To authorize the Tax
Commissioner to sign the Streamlined Sales and Use Tax Agreement
adopted by the implementing states on November 12, 2002; and (b) to
enact all substantive changes in West Virginia sales and use tax
laws necessary for those laws to be in substantial compliance with
the Agreement, which is a condition precedent to signing the
Agreement and participating as a member of the governing board of
the Agreement, except that the Legislature would reserve to another
day authorizing payment of vendor compensation until such time as
necessary information becomes available to reasonably quantify the
effect the monetary allowances will have on net sales and use tax
collections.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§§11-15B-2a, 11 through 32 are new; therefore, strike-throughs
and underscoring have been omitted.