[Introduced January 91, 2003; referred to the Committee on
Economic Development; and then to the Committee on Finance.]thousand nine hundred thirty-one, as amended, by adding thereto a new article, designated article thirteen-t, relating to taxation generally; setting forth short title; setting forth legislative findings; defining terms; specifying method for determining tax attributable to qualified investment; specifying eligibility for tax credit; specifying procedures for application for certification and for certification of project plans; specifying limitations on certification and criteria for certification; specifying applications for certification are public information; specifying procedures and criteria for decertification of projects or withdrawal or suspension of certification of projects or decrease of amounts of credit or qualified investment for which a project is certified; providing for audits and investigations; specifying confidentiality of certain information; providing for a project administration allowance to be deposited in a revolving fund for use by the division of tourism; establishing the small tourism business fund as a revolving fund; providing for a tax administration allowance to be deposited in a revolving fund for use by the tax department; establishing the general tax administration fund as a revolving fund; specifying method for determining qualified investment; specifying amount of tax credit allowed; setting forth application of credit; specifying method for assertion of credit and filings; specifying requirements for reporting of credit; setting forth total maximum aggregate tax credit limitation; specifying forfeiture of unused tax credits; specifying redetermination of credit; specifying recapture of credit; specifying treatment for premature disposition of qualified property; specifying treatment for premature cessation of use of qualified property; specifying recapture tax; specifying imposition of recapture tax; specifying application of the West Virginia tax procedure and administration act to the recapture tax; setting forth rules for transfer of qualified property to successors; specifying treatment of successor businesses where predecessor is entitled to the credit; specifying treatment of a mere change in the form of doing business; requiring and specifying identification of qualified tourism development property; specifying rules for failure to keep adequate records; specifying certain credit information to be published as public information; authorizing audits and joint audits or examinations of taxpayers claiming the credit and certain other persons; requiring program evaluation; setting forth expiration date for the tax credit program; specifying preservation of vested entitlements; specifying general procedure and administration and adoption of the West Virginia tax procedure and administration act as applying to the tax credit; and authorizing promulgation of regulations.
That chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, be amended by adding thereto
a new article, designated article thirteen-t, to read as follows:This article shall be known and cited as the "Small Tourism
Business Development Act."The Legislature finds and declares that the general welfare
and material well-being of the people of West Virginia will be
improved and increased by the development of tourism attractions
and amenities in the less developed counties of this state with high unemployment. It is in the best interests of this state to
induce the creation, expansion and improvement of tourism
attractions and amenities within those counties of this state.
Development of tourism attractions and amenities serves the public
purposes of relieving unemployment, preserving and creating jobs,
and creating tax revenues for the support of essential public
services. The Legislature finds and declares that the purposes to
be accomplished by this article are proper governmental and public
services for which public moneys can be expended.(a) General. -- When used in this article, or in the
administration of this article, terms defined in subsection (b) of
this section have the meanings ascribed to them by this section,
unless a different meaning is clearly required by either the
context in which the term is used, or by specific definition in
this article. (b) Terms defined. -- (1) Affiliate. -- The terms "affiliate" or "affiliates"
include all concerns which are affiliates of each other when either
directly or indirectly: (A) One concern controls or has the power to control the
other; or (B) A third party or third parties control or have the power
to control both. In determining whether concerns are independently owned and operated and whether or not affiliation exists,
consideration will be given to all appropriate factors, including
common ownership, common management and contractual relationships. (2) Bed and breakfast facility. -- Bed and breakfast facility
means:(A) An architecturally interesting or historic structure,
facility, complex, or set of facilities consisting of one or more
buildings, cottages, carriage houses, cabins, homesteads or
structures, operated as a lodging facility or complex which
contains not more than eight bedrooms in total for the commercial
accommodation of paying overnight lodgers. In order to qualify as
a bed and breakfast facility under this article, the facility or
complex, if located in an area subject to zoning laws, must be
located in an area legally zoned for such operation, and must
comply with all applicable tax, fire, building and health
requirements applicable to the property given its size and use.(B) Exclusions. -- The term bed and breakfast facility does
not include: (i) Any facility or complex having more than eight bedrooms
for commercial accommodation of paying overnight lodgers;(ii) Rental condominiums, time sharing housing units and
similar accommodations;(iii) Any bed and breakfast facility which, even though the
facility may have once qualified as a bed and breakfast facility under this section, is enlarged to the point that the facility or
complex includes more than eight bedrooms for commercial
accommodation of paying overnight lodgers;(iv) Hotels, motels, hostels and resort lodging facilities. (3) Corporation. -- The term "corporation" means any
corporation, joint-stock company or association and any business
conducted by a trustee or trustees wherein interest or ownership is
evidenced by a certificate of interest or ownership or similar
written instrument, or any entity treated as a corporation for
federal income tax purposes.(4) 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 department of tax and revenue,
tax department 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. (5) Eligible taxpayer. --(A) The term "eligible taxpayer" means any person subject to
the taxes imposed by article twenty-one, twenty-three or
twenty-four of this chapter that makes qualified investment
pursuant to the terms of a certified project plan in qualified
tourism development property.(B) The term "eligible taxpayer" also includes an affiliated
group of taxpayers if the group elects to file a consolidated corporation net income tax return under article twenty-four of this
chapter and if one or more affiliates included in the affiliated
group would qualify as an eligible taxpayer under paragraph (A) of
this subdivision. (C) The term "eligible taxpayer" does not include this state,
any state, territory or district of the United States, the United
States or, any agency, governmental subdivision, authority,
commission, department, division, office, bureau, branch, board,
district or other unit, or instrumentality of federal, state,
county or local government or any public corporation, or
governmental instrumentality or quasi-governmental instrumentality
or entity created by statute or ordinance.(6) Includes and including. -- The terms "includes" and
"including", when used in a definition contained in this article,
do not exclude other things otherwise within the meaning of the
term defined. (7) Natural person or individual. -- The term "natural person"
and the term "individual" mean a human being. The terms "natural
person" and "individual" do not mean, and specifically exclude any
corporation, limited liability company, partnership, joint venture,
trust, organization, association, agency, governmental subdivision,
syndicate, affiliate or affiliation, group or unit or any entity
other than a human being. (8) Partnership and partner. -- The term "partnership" includes a syndicate, group, pool, joint venture or other
unincorporated organization through or by means of which any
business, financial operation or venture is carried on, and which
is not a trust or estate, a corporation or a sole proprietorship.
The term "partner" includes a member in a syndicate, group, pool,
joint venture or organization. (9) Person. -- The term "person" includes any natural person,
corporation, limited liability company or partnership. (10) Qualified investment. -- The term "qualified investment"
means qualified investment as determined under section five of this
article.(11) Qualified tourism development area. -- The term
"qualified tourism development area" means any of those counties of
this state that have, for the calendar year immediately preceding
the calendar year when qualified tourism investment property is to
be placed in service or use in the county, a county average annual
unemployment rate that is at least one percentage point greater
than the statewide unemployment average percentage, as determined
by the West Virginia bureau of employment programs: Provided, That
the commissioner of the division of tourism may issue legislative
regulations further restricting inclusion of counties in any
qualified tourism development area and describing those counties of
this state that qualify as qualified tourism development areas or
parts thereof, but in no case may any county be designated a qualified tourism development area that has a county average annual
unemployment rate that is less than one percentage point greater
than the statewide unemployment average percentage, as determined
under this subdivision. (12) Qualified tourism development property. -- (A) The term "qualified tourism development property" means
property purchased or leased pursuant to the terms of a certified
project plan for the purpose of expanding, improving, enlarging,
constructing or creating in a qualified tourism development area:(i) A site, area or facility which will constitute a tourism
attraction, as defined in this section, or part of a tourism
attraction; or (ii) A bed and breakfast facility located in this state, which
primarily serves individuals who participate in, patronize or
attend a tour or trip constituting a tourism attraction, or who
visit an area, site or facility constituting a tourism attraction,
primarily for the purpose of personal entertainment, recreation or
amusement. The term "lodging facility" means a temporary place to
stay or a place where overnight accommodations for sleeping and
shelter are available.For purposes of this section, the terms expanding, improving
and enlarging mean: If a bed and breakfast facility: Expansion, improvement or
enlargement such as to create additional lodging capacity at least ten percent greater than such capacity, measured at the maximum, of
the lodging facility as it existed immediately prior to the
expansion, improvement or enlargement: Provided, That any bed and
breakfast facility which is enlarged to the point that the facility
or complex includes more than eight bedrooms for commercial
accommodation of paying overnight lodgers does not constitute
qualified tourism development property, even though the facility
may have once qualified as a bed and breakfast facility under this
article prior to the expansion.If an area, site or facility constituting a tourism
attraction, expansion, improvement or enlargement as to create
additional daily visitor or daily customer capacity at least ten
percent greater than that capacity, measured at the maximum, of the
area, site or facility as it existed immediately prior to the
expansion, improvement or enlargement: Provided, That where there
is replacement property, only betterments resulting in expansions
of fifty percent or more, as specified in this section constitute
qualified tourism development property.(B) Excluded property. -- The term "qualified tourism
development property" does not include: (i) Property purchased or leased before the first day of July,
one thousand nine hundred ninety-nine;(ii) Property owned or leased by the taxpayer, investment in
which qualifies for the business investment and jobs expansion tax credit under article thirteen-c of this chapter, without regard to
whether the taxpayer actually takes or applies the business
investment and jobs expansion tax credit against tax liabilities.
Investment for which the business investment and jobs expansion tax
credit is or would be allowed is not eligible for the credit
allowed under this article, and no credit may be allowed or taken
under this article for any such investment;(iii) Property owned or leased by the taxpayer and for which
the taxpayer was previously allowed tax credit under article
thirteen-d of this chapter or tax credit under article thirteen-c
of this chapter, the historic buildings and structures preservation
tax credit under sections eight-a through eight-f, article
twenty-one of this chapter or sections twenty-three-a through
twenty-three-f, article twenty-four of this chapter or the tax
credits allowed by this article;(iv) Property owned or leased by the taxpayer and for which
the seller, lessor or other transferor, was previously allowed tax
credit under article thirteen-d of this chapter or tax credit under
article thirteen-c of this chapter, the historic buildings and
structures preservation tax credit under sections eight-a through
eight-f, article twenty-one of this chapter or sections
twenty-three-a through twenty-three-f, article twenty-four of this
chapter or the tax credits allowed by this article. However,
successors in business shall be allowed entitlement to this credit to the extent of the predecessor's entitlement in accordance with
section twelve of this article;(v) Repair costs, including materials used in the repair; (vi) Airplanes;(vii) Property which is primarily used outside this state,
with use being determined based upon the amount of time the
property is actually used both within and without this state; (viii) Property which is acquired incident to the purchase of
the stock or capital assets of the seller, unless for good cause
shown, the tax commissioner consents to waiving this requirement; (ix) Natural resources in place;(x) Property, either leased or purchased, the cost or
consideration for which cannot be quantified with any reasonable
degree of accuracy at the time the property is placed in service or
use: Provided, That when the contract of purchase or lease
specifies a minimum purchase price or minimum annual rent, the
amount thereof shall be used to determine the qualified investment
in the property under section five of this article if the property
otherwise qualifies as qualified tourism development property;(xi) Property purchased for ongoing maintenance and upkeep,
repairs, facility maintenance or other maintenance, airplanes,
motor vehicles licensed by the division of motor vehicles,
inventories, noncapitalized property and property that does not
create additional lodging capacity or visitor or customer capacity. For purposes of this section, the term "noncapitalized property"
means property, the cost of which is not required to be capitalized
for federal income tax purposes under the Internal Revenue Code or
the rules, regulations or policies implemented or promulgated by
the United States Internal Revenue Service;(xii) Property owned or leased (as lessee) by this state, any
state, territory or district of the United States, the United
States or, any agency, governmental subdivision, authority,
commission, department, division, office, bureau, branch, board,
district or other unit, or instrumentality of federal, state,
county or local government or any public corporation, or
governmental instrumentality or quasi-governmental instrumentality
or entity created by statute or ordinance and located in a state
park or elsewhere in this state. However, investment made by a
qualified taxpayer in a facility or property located in a state
park may constitute qualified tourism development property if
investment therein would otherwise qualify for credit under this
article;(xiii) Replacement property, except certain replacement
property that will qualify as specified in this article. For
purposes of this section, the term "replacement property" means
property acquired by purchase or lease for the purpose of replacing
other property in a facility, the investment in which replacement
property would not have been made but for the loss of service, destruction, removal or other loss of the property which the
replacement property is intended to replace: Provided, That
significant betterments will be recognized as qualified tourism
development property. The term "betterment" means and is limited
to:(aa) Replacement property which enlarges the lodging capacity
of a bed and breakfast facility in which the replacement property
is installed or placed by at least fifty percent; and to (bb) Replacement property which enlarges the daily visitor or
customer capacity of an area, site or facility that constitutes a
tourism attraction by at least fifty percent. A betterment will be
treated as significant if it enlarges capacity by at least fifty
percent over the capacity, measured at the maximum, of the bed and
breakfast facility or area, site or facility constituting a tourism
attraction at the time the property which the replacement property
is intended to replace was in operation. Replacement property
which is installed or constructed to replace property that was
destroyed by flood, storm or other casualty will constitute
qualified tourism development property if the property would
otherwise qualify as such under this section if newly constructed,
but the measure of the cost of the replacement property for
purposes of this article will be reduced by any insurance proceeds
or other proceeds received in compensation for the casualty loss;(xiv) The term "qualified tourism development property," does not mean or include investment (by purchase or lease) in any
property acquired from or between related entities. The tax
commissioner can waive this prohibition against related entity
acquisitions if the property was acquired from a related entity for
the fair market value and there is no manipulation of the cost of,
or amount of, investment in property for the purpose of gaining
entitlement to the credit allowed under this article;(xv) Any hotel, motel, resort lodging facility or other
lodging facility other than a bed and breakfast facility;(xvi) Any restaurant: Provided, That a bed and breakfast
facility which offers only breakfast to its guests does not
constitute a restaurant for purposes of this exclusion: Provided,
however, That investment in a tourism attraction facility which
contains or incorporates a restaurant into the otherwise qualified
tourism attraction constitutes qualified tourism development
property to the extent of investment in those parts or portions of
the facility, other than the restaurant, that are not otherwise
disqualified under this article.(13) Related person. -- The term "related person" or "person
related to" a stated taxpayer means: (A) An individual, corporation, partnership, affiliate,
association or trust or any combination or group thereof controlled
by the taxpayer; or (B) An individual, corporation, partnership, affiliate, association or trust or any combination or group thereof that is in
control of the taxpayer; or (C) An individual, corporation, partnership, affiliate,
association or trust or any combination or group thereof controlled
by an individual, corporation, partnership, affiliate, association
or trust or any combination or group thereof that is in control of
the taxpayer; or (D) A member of the same controlled group as the taxpayer.
For purposes of this article, "control", with respect to a
corporation means ownership, directly or indirectly, of stock
possessing fifty percent or more of the total combined voting power
of all classes of the stock of the corporation which entitles its
owner to vote. "Control", with respect to a trust, means
ownership, directly or indirectly, of fifty percent or more of the
beneficial interest in the principal or income of the trust. The
ownership of stock in a corporation, of a capital or profits
interest in a partnership or association or of a beneficial
interest in a trust shall be determined in accordance with the
rules for constructive ownership of stock provided in Section
267(c), other than paragraph (3) of such section, of the United
States Internal Revenue Code, as amended. (14) State fiscal year. -- "State fiscal year" means a
twelve-month period beginning on the first day of July and ending
on the thirtieth day of June. (15) Tax attributable to qualified investment. -- "Tax
attributable to qualified investment" means that amount of the
consumers sales and service tax determined under section three-a of
this article as tax attributable to qualified investment.(16) Taxpayer. -- The term "taxpayer" means any person subject
to the tax imposed by article twenty-one, twenty-three or
twenty-four of this chapter (or any one or combination of those
articles of this chapter).(17) Tax year. -- "Tax year" means the tax year of a taxpayer
as determined for federal income tax purposes.(18) Tourism attraction. -- "Tourism attraction" means:(A) Any of the following facilities, sites or areas occurring
or present in this state:(i)A cultural or historical site certified for those
purposes of this article by the division of culture and history of
the department of education and the arts;(ii) A recreational or entertainment facility;(iii) An area of scenic beauty or a phenomenon of natural or
scientific significance;(iv) A theme park;(v) An amusement park;(vi) An indoor or outdoor theater or amphitheater for the
exhibition of plays or live shows, but not theaters exclusively for
the exhibition of moving pictures or video presentations;(vii) Botanical gardens;(viii) Cultural or educational centers other than primary and
secondary schools and institutions of higher education;(ix) Whitewater rafting trips, tours, areas or facilities or
other water float trips, tours, areas or facilities;(x) West Virginia state parks; (xi) Rail excursion tours or facilities;(xii) River boat tours or facilities; (xiii) Excursions and tours over pathways, roads and trails
established pursuant to the West Virginia rails to trails program.(xiv) Water sports facilities;(xv) Boating or canoeing trips, tours, areas or facilities;(xvi) Mountain biking trips, tours, areas and facilities;(xvii) Cycling trips, tours, areas and facilities;(xviii) Hunting areas and facilities;(xix) Snow skiing, snow boarding and snow sport or snow
recreation areas and facilities;(xx) Fishing areas and facilities;(xxi) Golf courses;(xxii) Hiking trails, areas or facilities;(xxiii) Bird watching areas or facilities;(xxiv) Camping areas or facilities;(xxv) Industrial tourism sites; (xxvi) Sports arenas and sports centers;(xxvii) Race tracks for automobile or motorcycle racing;(B) The term "tourism attraction" does not mean or include:(i) Any facility, site or area not wholly occurring in this
state or not wholly located in this state;(ii) Facilities, areas or sites that are primarily devoted to
the retail sale of goods, unless the goods are created at the site
of the tourism attraction or unless the sale of the goods is
incidental to the tourism attraction;(iii) Facilities, tours, trips, areas or sites that are not
open to the public;(iv) Facilities, sites or areas established, wholly or in
part, for the purpose of conducting legalized or illegal gambling,
or facilities, sites or areas where gambling occurs. For purposes
of this definition the term "gambling" does not include charitable
bingo gaming sponsored and operated by an organization licensed by
this state to hold charitable bingo occasions. For purposes of this
definition the term "gambling" does not include charitable raffle
gaming sponsored and operated by an organization licensed by this
state to hold charitable raffle occasions.(a) Annual determination of tax attributable to qualified
investment. --(1) Tax attributable to qualified investment is the excess of: (A) The allowable portion of the consumers sales and service tax imposed by article fifteen of this chapter and collected by the
eligible taxpayer from its patrons and vendees during the tax year
over:(B) The amount of the consumers sales and service tax imposed
by article fifteen of this chapter and collected by the eligible
taxpayer from its patrons and vendees in the base year;(2) In any tax year when the amount described in paragraph
(A), subdivision (1) of this subsection exceeds the amount
described in paragraph (B), subdivision (1) of this subsection, tax
attributable to qualified investment is zero.(c) Allowable portion. -- The allowable portion of the
consumers sales and service tax imposed by article fifteen of this
chapter and collected by the eligible taxpayer from its patrons and
vendees during the tax year is the total amount of consumers sales
and service tax imposed by article fifteen of this chapter and
collected by the eligible taxpayer from its patrons and vendees
during the tax year less: Consumers sales and service tax
collected as a result of the making of sales, or the providing of
taxable services by the eligible taxpayer or the operation or use
of any facility or business, or the result of any other activity
taxable under article fifteen of this chapter which is pursued,
undertaken, engaged in or otherwise done subsequent to the
placement of the qualified investment into service or use, but
which is not:(1) Directly attributable to and the direct result of the
qualified investment; or(2) Directly attributable to and the direct result of
investment in place and owned or leased by the eligible taxpayer
and in operation in the base year; or(3) Directly attributable to or derived from the operation of
any restaurant, hotel, motel or other lodging facility excluded
from the definition of qualified tourism development property.(d) Base year. -- The base year is the eligible taxpayer's tax
year, for federal income tax purposes, immediately preceding the
tax year during which any qualified investment is first placed into
service or use.(e) Multiple entitlements to credit. -- If there are multiple
entitlements to the credit allowed under this article which arise
under separate certified projects, the tax attributable to
qualified investment, the allowable portion of the consumers sales
and service tax imposed by article fifteen of this chapter and
collected by the eligible taxpayer from its patrons and vendees
during the tax year, and the base year shall be determined
separately for each certified project. (f) Tax attributable to qualified investment for purposes of
the monthly or quarterly remittance of tax and assertion of credit.
--(1) For purposes of the monthly or quarterly filing and remittance of the consumers sales and service tax and the assertion
of credit on the monthly or quarterly consumers sales and service
tax return against tax attributable to qualified investment, the
monthly or quarterly tax attributable to qualified investment is
the excess of:(A) The allowable portion, determined on a monthly or
quarterly basis, of the consumers sales and service tax imposed by
article fifteen of this chapter and collected by the eligible
taxpayer from its patrons and vendees during the taxable month or
taxable quarter over;(B) The amount of the consumers sales and service tax imposed
by article fifteen of this chapter and collected by the eligible
taxpayer from its patrons and vendees in the corresponding taxable
month or taxable quarter of the base year.(2) In any taxable month or taxable quarter when the amount
described in paragraph (B), subdivision (1) of this subsection
exceeds the amount described in paragraph (A), subdivision (1) of
this subsection, tax attributable to qualified investment for that
taxable month or taxable quarter is zero.(g) Annual reconciliation. --(1) Eligible taxpayers who apply the credit allowed under this
article on a monthly or quarterly basis must make a reconciliation
at the end of each tax year to determine the amount of annual tax
credit allowable under this article for the tax year, based on annual tax attributable to qualified investment, and on the
limitations set forth in section seven of this article; (2) Within thirty days of the close of the tax year, the
eligible taxpayer must file an annual credit reconciliation
statement on a form prescribed by the tax commissioner, and for
those eligible taxpayers who have underpayments of tax or
overpayments of tax shown on the reconciliation:(A) Must pay to the tax commissioner the amount of any credit
taken in excess of the annual limitations, as shown of the annual
credit reconciliation statement; or (B) Must apply to the tax commissioner for a refund of any tax
overpayment resulting from the eligible taxpayer's failure to apply
annual credit to which the eligible taxpayer was entitled.§11-13T-5. Eligibility for tax credits; certification of project plans by the division of tourism.
(a) A taxpayer who seeks to have a project certified pursuant
to this article must submit to the commissioner of the division of
tourism an application for certification of a project plan, in the
form prescribed by the commissioner of the division of tourism,
setting forth the project to be implemented, the amount of
projected qualified investment to be made, the nature and location
of the proposed project, the amount of total tax credits to be
created by the proposed project under this article, an estimate of
the number of new jobs to be created by the project and the schedule for implementing the project. Every applicant for certification must pay to the division of
tourism an application fee with each application for project
certification filed with the division of tourism. The application
fee shall be an amount to be set by the division of tourism by
legislative rule, but may in no case exceed the amount of fifty
dollars per project application. The application fee shall be
deposited by the division of tourism in the small tourism business
development fund created under this article, and is nonrefundable
to the applicant. The division may not certify or consider for
certification any project until the application fee for that
project has been paid.(b) Receipt of applications for certification in the first and
third quarters. -- The commissioner of the division of tourism
shall receive applications for certification of proposed projects
during the first quarter and the third quarter of each state fiscal
year. These quarters being held open for receipt of applications,
the commissioner of the division of tourism may not issue
certification of any project during the first and third quarters of
each state fiscal year.(c) Issuance of certification in the second and fourth
quarters. -- The commissioner of the division of tourism shall, in
the second quarter of the state fiscal year, certify, or deny
certification of, those proposed projects for which applications for certification have been filed during the first quarter of the
state fiscal year. The commissioner of the division of tourism
shall, in the fourth quarter of the state fiscal year certify, or
deny certification of, those proposed projects for which
applications for certification have been filed during the third
quarter of the state fiscal year. No applications for
certification may be accepted by the commissioner of the division
of tourism during the second and fourth quarters of the state
fiscal year: Provided, That the commissioner of the division of
tourism may during any quarter accept information, documents or
other material necessary to complete an application lawfully filed
in a prior quarter, but found to be incomplete by the commissioner
of the division of tourism.(d) No certification may be issued for any proposed project
that is not in conformance with the requirements of this article.(e) Applications for which the commissioner of the division of
tourism requires additional information do not constitute completed
applications until the information has been received by the
commissioner of the division of tourism. (f) Those projects for which certification is not issued by
the commissioner of the division of tourism within in the next
succeeding second or fourth quarter subsequent to the quarter
during which the completed application for certification was
received by the division of tourism are considered disapproved by operation of law. (g) The division of tourism shall promptly notify an applicant
as to whether an application for certification of a project plan
has been approved or disapproved. (h) Those applicants who receive certification of a project
plan, and which otherwise comply with the requirements of this
article, may place qualified tourism development property into
service or use. Eligible taxpayers may begin taking the credit
allowed under this article in the tax year when qualified
investment is placed in service or use. (i) Eligible taxpayers who make qualified investment in
qualified tourism development property in a project certified under
this article shall receive a tax credit as provided in section six
of this article: (1) No tax credit may be granted under this article for any
investment except qualified investment in qualified tourism
development property, as defined in this article, placed in service
in a project which has been certified in accordance with the
requirements of this article prior to the placement of the
qualified investment into service or use; (2) No tax credit may be granted under this article for any
investment which, if allowed, would cause the amount of tax credit
generated by the project to exceed the maximum amount of tax credit
for which the project was certified as stated in the application for project certification filed with the division of tourism; (3) No project may be certified, in whole or in part, for
which the amount of the proposed investment exceeds four million
dollars. However, certification may not be negated or withdrawn for
a project having a legitimate projected cost at the time of
certification of four million dollars or less, solely by reason of
cost overruns or unforseen circumstances which cause the ultimate
cost of the certified project to exceed four million dollars:
Provided, That no tax credit may be allowed or taken for that
portion of the investment which exceeds the amount for which the
project was originally certified.(j) All applications for certification of a project filed with
the division of tourism, whether the project is certified or denied
certification, are public information which may be viewed and
copied by the public and, at the discretion of the division of
tourism, published by the division of tourism. (1) Decertification, withdrawal of certification suspension of
certification. --(A) The commissioner of the division of tourism may, at the
discretion of the commissioner of the division of tourism, impose
sanctions in circumstances where:(i) The taxpayer has failed, in whole or in part, to place
qualified investment into service or use as delineated in the
application for project certification; (ii) The taxpayer has obtained certification of a project
under this article fraudulently; or (B) A taxpayer has failed to remit to the tax department that
portion of the consumers sales and service tax attributable to
qualified investment, after withholding by the taxpayer of the
credit allowed under this article. (2) Sanctions. -- Upon determining the existence of one or
more of the conditions set forth in subdivision (1) of this
subsection, the commissioner of the division of tourism may impose
the following sanctions:(A) Prospective revocation of the project certification. --
No tax credit may be allowed for any project for which
certification has been revoked for periods subsequent to the
effective date of revocation. Tax credit taken by any taxpayer or
person in accordance with this article pursuant to the making of
qualified investment in a certified project prior to the effective
date of revocation of project certification is not subject to
recapture by reason of revocation of the certification. However,
the credit is otherwise subject to audit and adjustment or
recapture in accordance with the requirements of this article and
article ten of this chapter;(B) Retroactive withdrawal of the project certification. --
No tax credit may be allowed for any project for which
certification has been withdrawn. Tax credit taken by any taxpayer or person in accordance with this article pursuant to the making of
qualified investment in a certified project for which certification
is later withdrawn pursuant to the provisions of this section is
not subject to recapture upon withdrawal of the certification; (C) Suspension of the project certification for a stated
period of time. -- No tax credit may be allowed for investment made
during the suspension period for a project. Tax credit taken by
any taxpayer or person in accordance with this article pursuant to
the making of a qualified investment in a certified project prior
to or subsequent to the suspension period is not subject to
recapture by reason of the suspension. However, the credit is
otherwise subject to audit and adjustment or recapture in
accordance with the requirements of this article and article ten of
this chapter;(D) Decreasing the amount of tax credit or qualified
investment for which the taxpayer or person is certified. -- The
commissioner of the division of tourism may decrease the amount of
qualified investment or the amount of tax credit for which a given
project is certified, so that the eligible taxpayer may continue to
take the credit, but the amounts of total credit and annual tax
credit allowed to be taken by the eligible taxpayer are decreased;(E) Any combination of the aforementioned sanctions may be
imposed at the discretion of the commissioner of the division of
tourism.(k) Audits and investigations. --(1) The division of tourism or the tax department, or both the
division of tourism or the tax department, may initiate and carry
out investigations or audits of any taxpayer or person or eligible
taxpayer, applicant for project certification or recipient of
project certification to determine whether: (A) The taxpayer or person has failed, in whole or in part, to
place qualified investment into service or use as delineated in the
application for project certification; (B) The taxpayer or person has obtained certification of a
project under this article fraudulently; or (C) A taxpayer or person has failed to remit to the tax
department that portion of the consumers sales and service tax
attributable to qualified investment, after withholding by the
taxpayer or person of the credit allowed under this article. (2) No provision of this article may be construed to limit,
impede or abrogate the powers of the tax commissioner to initiate
and carry out investigations or audits of any taxpayer or person
for the purpose of determining any amount of tax due, the
correctness of any remittance of tax or withholding of tax,
entitlement to any tax credit, and the amount of tax credit
asserted or allowed, or any other matter relating to the
administration and enforcement of the tax laws of this state.(l) Procedures. --(1) Notice of pending sanctions. -- Upon the making of a
determination by the commissioner of the division of tourism that
sanctions shall be applied under this section, the commissioner of
the division of tourism shall serve upon the taxpayer or person
against whom sanctions are to be applied a notice of pending
sanctions. (2) Service of notice, content of notice. -- The notice of
pending sanctions shall be served upon the taxpayer or person in
the same manner as an assessment of tax in accordance with article
ten of this chapter. The notice of pending sanctions shall state
the sanctions to be applied in accordance with this section, the
effective date or dates of such sanctions, with specific statements
of whether any sanction is to be applied retroactively or in part
retroactively, and the commencement and termination dates for any
suspensions of certification or temporary disqualifications of any
taxpayer or person to be disqualified under this section from
participation in certified projects. The notice of pending
sanctions shall state that sanctions must be imposed sixty days
after service of the notice of pending sanctions upon the taxpayer
or person, unless the taxpayer or person effects a remedy of the
cause for the sanction, satisfactory to the commissioner of the
division of tourism such as to allow the commissioner of the
division of tourism to waive, withdraw, modify or not impose the
sanction. (3) Appeals. -- The taxpayer or person may file an appeal of
pending sanctions as if the notice of pending sanctions were an
assessment of tax under article ten of this chapter, and the matter
on appeal is subject to the procedures set forth in article ten of
this chapter. On appeal, the burden of proof is on the taxpayer or
person against whom sanctions are to be imposed to prove that the
conditions for applying sanctions have not been met.(4) Statutory confidentiality. -- Any proceeding relating to
any amount of tax due or the recapture of tax credit taken under
this article or any adjustment of the amount of tax credit taken
under this article is subject to the provisions of article ten of
this chapter, including all statutory confidentiality provisions,
and is subject to all other applicable statutory tax
confidentiality provisions of this code. (m) Effect of a final determination, waiver of penalties or
sanctions. -- The notice of pending sanctions becomes final sixty
days after service unless an appeal is filed under this section,
and is not subject to further appeal by the recipient thereof.
When a determination has become final that a taxpayer or person is
subject to sanctions under this section, the sanctions described in
the notice of pending sanctions shall apply, effective as of the
date set forth in that notice, unless the taxpayer or person
effects a remedy of the cause for the sanction, satisfactory to the
commissioner of the division of tourism such as to allow the commissioner of the division of tourism to waive, withdraw, modify
or not impose the sanction. The sanctions authorized under this
section may be imposed, adjusted, withdrawn or waived, in whole or
in part, at the discretion of the commissioner of the division of
tourism. (a) Project administration allowance. -- Out of consumers
sales and service tax attributable to qualified investment remitted
to the tax commissioner, the tax commissioner shall deposit in the
small tourism development fund created under this article the
lesser of:(1) Two percent of the amount of the remaining tax
attributable to qualified investment that is remitted to the tax
department, after withholding by the eligible taxpayer of the
credit allowed under this article; or (2) Four tenths of one percent of total tax attributable to
qualified investment.(b) Small tourism business development fund. --(1) For the purpose of permitting payments to be made and
costs to be met for operation of the program established by this
article, there is hereby created a revolving fund for the division
of tourism, which shall be known as the small business tourism
development fund. Moneys in the small tourism business development
fund shall be expended by the division of tourism for purposes of defraying the costs incurred by the division of tourism in
administering the program established pursuant to this article, and
for general administrative costs of the division of tourism. (2) The small tourism business development fund shall be
accumulated and administered as follows:(A) Portions of the consumers sales and service tax
attributable to qualified investment remitted to the tax
commissioner shall be deposited into the small tourism business
development fund by the tax commissioner as specified in this
article; (B) Any appropriations made to the small tourism business
development fund and all moneys therein are not considered to have
expired at the end of any fiscal period;(c) Tax administration allowance. -- Out of consumers sales
and service tax attributable to qualified investment remitted to
the tax commissioner, the tax commissioner shall deposit in the
general tax administration fund created under this article the
lesser of:(1) Two percent of the remaining tax attributable to qualified
investment that is remitted to the tax commissioner after
withholding by the eligible taxpayer of the credit allowed under
this article; or (2) Four tenths of one percent of total tax attributable to
qualified investment.(d) General tax administration fund. --(1) There is hereby created a revolving fund for the tax
department which shall be known as the general tax administration
fund. The tax department administration fee paid under this
article shall be paid by the tax commissioner into the state
treasury and deposited to the credit of the tax department general
tax administration fund. Moneys in the tax department general tax
administration fund must be expended by the tax department for the
purpose of defraying costs incurred by the tax department for
handling remittances and deposits for the program established
pursuant to this article and for costs of general tax
administration. (2) The tax department general tax administration fund shall
be accumulated and administered as follows: (A) Portions of the consumers sales and service tax
attributable to qualified investment shall be deposited into the
small tourism business development fund by the tax commissioner as
specified in this article; (B) Any appropriations made to the tax department general tax
administration fund and all moneys therein are not considered to
have expired at the end of any fiscal period.(a) General. -- Qualified investment in qualified tourism
development property is the applicable percentage of the cost of property purchased or leased and constituting qualified tourism
development property as defined in this article which is placed in
service or use in this state by the taxpayer during the taxable
year.(b) Applicable percentage. -- For the purpose of subsection
(a) of this section, the applicable percentage of any property
shall be determined under the following table:If useful life is:The applicable
percentage is:4 years or more but less than 6 years ......33-%6 years or more but less than 8 years ......66|%
8 years or more ............................100% (c) Cost. -- For purposes of subsection (a) of this section,
the cost of each property purchased for business expansion shall be
determined under the following rules: (1) Trade-ins. -- Cost does not include the value of property
given in trade or exchange for the property purchased for business
expansion; (2) Damaged, destroyed or stolen property. -- If property is
damaged or destroyed by fire, flood, storm or other casualty, or is stolen, then the cost of replacement property does not include any
insurance proceeds received in compensation for the loss;(3) Rental property. --(A) The cost of real property acquired by written lease for a
primary term of ten years or longer is one hundred percent of the
rent reserved for the primary term of the lease, not to exceed
twenty years. Real property leased for a primary term of less than
ten years does not constitute qualified tourism development
property.(B) The cost of tangible personal property acquired by written
lease for a primary term of: (i) Four years, or longer, is one third of the rent reserved
for the primary term of the lease; (ii) Six years, or longer, is two thirds of the rent reserved
for the primary term of the lease; or (iii) Eight years, or longer, is one hundred percent of the
rent reserved for the primary term of the lease, not to exceed
twenty years: Provided, That in no event may rent reserved include
rent for any year subsequent to expiration of the book life of the
equipment, determined using the straight-line method of
depreciation. (4) Self-constructed property. -- For self-constructed
property, the cost thereof is the amount properly charged to the
capital account for depreciation in accordance with federal income tax law. (5) Transferred property. -- The cost of property used by the
taxpayer out-of-state and then brought into this state, is
determined based on the remaining useful life of the property at
the time it is placed in service or use in this state, and the cost
is the original cost of the property to the taxpayer less straight
line depreciation allowable for the tax years or portions thereof
taxpayer used the property outside this state. For leased tangible
personal property, cost is to be based on the period remaining in
the primary term of the lease after the property is brought into
this state for use in a new or expanded business facility of the
taxpayer, and is the rent reserved for the remaining period of the
primary term of the lease, not to exceed twenty years, or the
remaining useful life of the property (determined as aforesaid),
whichever is less.(a) Credit allowed. --Eligible taxpayers are allowed a credit, the application of
which and the amount of which are determined as provided in this
article. (b) Amount of credit. -- The amount of credit allowable is
twenty-five percent of the amount of the taxpayer's qualified
investment, as defined in this article: Provided, That for a
qualified investment in a bed and breakfast facility, as defined in this article, the amount of credit allowable is fifty percent of
the amount of the taxpayer's qualified investment, as defined in
this article.(c) Application of credit over either five years or ten years
at the election of the taxpayer, limitations. --At the election of the taxpayer, the amount of credit
allowable under this article must be taken over either a five-year
period or over a ten-year period. The election to take the credit
over a ten-year period or a five-year period must be made in the
application for certification of the project filed with the
commissioner of the division of tourism under this article. The
election is irrevocable for the life of the credit. The amount of
credit allowed under this article must be taken as follows:(1) If over a ten-year period, at the rate of one tenth of the
amount thereof per tax year, beginning with the tax year in which
the taxpayer places the qualified tourism development property into
service or use, unless the taxpayer elected to delay the beginning
of the ten-year period until the next succeeding tax year. This
election must be made in the annual income tax return filed for the
tax year in which credit is first taken on the qualified investment
placed into service or use by the taxpayer. Once made, the
election cannot be revoked. A tax credit is allowable under this
article only for the tax year of the eligible taxpayer in which the
qualified tourism development property is placed in service or use (or at the election of the eligible taxpayer, the next succeeding
tax year), and for the next succeeding nine tax years. (2) If over a five-year period, at the rate of one fifth of
the amount thereof per tax year, beginning with the tax year in
which the taxpayer places the qualified tourism development
property into service or use, unless the taxpayer elected to delay
the beginning of the five-year period until the next succeeding tax
year. This election must be made in the annual income tax return
filed for the tax year in which credit is first taken on the
qualified investment placed into service or use by the taxpayer.
Once made, the election cannot be revoked. A tax credit is
allowable under this article only for the tax year of the eligible
taxpayer in which the qualified tourism development property is
placed in service or use (or at the election of the eligible
taxpayer, the next succeeding tax year), and for the next
succeeding four tax years. (d) Placed in service or use. -- For purposes of the credit
allowed by this article, property is considered placed in service
or use in the earlier of the following taxable years: (1) The taxable year in which, under the taxpayer's
depreciation practice, the period for depreciation with respect to
the property begins; or (2) The taxable year in which the property is placed in a
condition or state of readiness and availability for a specifically assigned function.(a) In general. -- The aggregate annual credit allowance for
a current tax year is an amount equal to the sum of the following: (1) If taken over a ten-year period; (A) The one-tenth part allowed under section six of this
article for qualified tourism development property placed into
service or use during a prior tax year; plus (B) The one-tenth part allowed under section six of this
article for qualified tourism development property placed into
service or use during the current tax year;(2) If taken over a five-year period: (A) The one-fifth part allowed under section six of this
article for qualified tourism development property placed into
service or use during a prior tax year; plus (B) The one-fifth part allowed under section six of this
article for qualified tourism development property placed into
service or use during the current tax year. (b) Application of current year annual credit allowance. --
The amount determined under subsection (a) of this section is
allowed as a credit as follows:(1) Out of the consumers sales and service tax imposed by
article fifteen of this chapter and collected by the vendor from
its patrons and vendees on and after the date qualified investment is placed in service or use, which amount would otherwise be
remitted periodically by the eligible taxpayer to the tax
commissioner, the eligible taxpayer shall withhold the lesser of:(A) The annual credit determined under subsection (a) of this
section; or (B) Up to eighty percent of tax attributable to qualified
investment;(C) The amount so withheld by the eligible taxpayer out of
each monthly or quarterly periodic remittance may not exceed eighty
percent of the total periodic remittance of tax attributable to
qualified investment which would otherwise be forwarded to the tax
commissioner;(D) Amounts of consumers sales and service tax withheld by the
eligible taxpayer in accordance with this subsection become the
property of the eligible taxpayer in satisfaction of the credit
allowed under this article.(d) The credit allowed under this article does not apply
against any other tax remittance or against any tax other than as
specified in this section.(e) Unused credit forfeited. -- If any annual credit allowable
for the taxable year, as determined under subsection (a) of this
section, remains after application of subsection (b) of this
section, the amount thereof shall be forfeited. No carryover to a
subsequent taxable year or carryback to a prior taxable year may be allowed for the amount of any unused portion of any annual credit
allowance.(a) Any eligible taxpayer who claims a tax credit as provided
in this article must file with the monthly or quarterly periodic
remittance to the tax commissioner of the consumers sales and
service tax collected, a statement, in a form prescribed by the tax
commissioner, of the amount of the consumers sales and service tax
withheld by the eligible taxpayer out of the periodic remittance,
along with any other information as the tax commissioner requires. (b) Any eligible taxpayer who claims a tax credit as provided
in this article must file with the West Virginia tax commissioner,
in a form prescribed by the tax commissioner, an annual tax credit
reporting schedule stating the amount of the qualified tourism
development property which the taxpayer has placed into service or
use. The eligible taxpayer must file with the tax credit reporting
schedule a certificate, issued by the commissioner of the division
of tourism, evidencing certification of the project plan by the
commissioner of the division of tourism, pursuant to which the
qualified tourism development property was placed into service or
use. (c) In the tax credit reporting schedule required under this
section, the taxpayer must provide all information required by the
tax commissioner's prescribed form. (d) The tax credit reporting schedule must be filed with the
annual return for the taxes imposed by article twenty-four of this
chapter for the tax year in which the qualified investment was
first placed into service or use pursuant to a certified project
plan: Provided, That if the eligible taxpayer is not required to
file a tax return under article twenty-four of this chapter, then
the tax credit reporting schedule must be filed with the annual
return for the taxes imposed by article twenty-three of this
chapter for the year: Provided, That if the eligible taxpayer is
not required to file a tax return under article twenty-three or
twenty-four of this chapter, then the tax credit reporting schedule
must be filed with the annual return for the taxes imposed by
article twenty-one of this chapter for the year. (e) The tax commissioner may disallow any credit claimed under
this article for which a properly completed tax credit reporting
schedule or other required documentation, statements or proofs are
not timely filed.§11-13T-11. Total maximum aggregate tax credit amount; certification of projects.
(a) The total amount of tax credits allowed under this article
may not exceed ten million dollars in any state fiscal year. (b) Applications for project certification must be filed with
the division of tourism. The division of tourism shall record the
date each application is filed. All complete and valid applications must be considered for approval or disapproval in a
timely manner by the division of tourism.(c) When the total amount of tax credits certified under this
article equals the maximum amount of tax credits allowed, as
specified in subsection (a) of this section, in any state fiscal
year, no further certifications may be issued in that same fiscal
year.(d) All applications filed in any state fiscal year and not
certified during the state fiscal year in which they are filed are
void by operation of law on the last day of the state fiscal year
in which they are filed, and all applicants which elect to seek
certification of a project plan must file anew on and after the
first day of the succeeding state fiscal year. (e) No project may be certified under this article whereby the
amount of qualified investment exceeds four million dollars. (f) No series of projects or group or number of projects may
be certified under this article for any person or group of related
persons whereby the amount of aggregate qualified investment
exceeds four million dollars.§11-13T-12. Forfeiture of unused tax credits; redetermination of credit allowed; credit recapture.
(a) Disposition of property or cessation of use. -- If during
any taxable year, property with respect to which a tax credit has
been allowed under this article: (1) Is disposed of prior to the end of its useful life; or (2) Ceases to be used in an eligible business of the taxpayer
in this state prior to the end of its useful life, then the unused
portion of the credit allowed for the property will be forfeited
for the taxable year and all ensuing years. Additionally, except
when the property is damaged or destroyed by fire, flood, storm or
other casualty, or is stolen, the taxpayer must redetermine the
amount of credit allowed in all earlier years by reducing the
applicable percentage of cost of the property allowed under section
seven of this article, to correspond with the percentage of cost
allowable for the period of time that the property was actually
used in this state in the new or expanded business of the taxpayer.
The taxpayer must then file a reconciliation statement with the tax
credit reporting schedule filed under section ten of this article,
for the year in which the forfeiture occurs. If the amount of
credit taken exceeds the amount of credit allowed as redetermined,
the taxpayer must pay the recapture tax as specified in this
article.(b) Cessation of operation of business facility. -- If during
any taxable year the taxpayer ceases operation of qualified tourism
development property in this state for which credit was allowed
under this article, before expiration of the useful life of the
property with respect to which tax credit has been allowed under
this article, then the unused portion of the allowed credit is forfeited for the taxable year and all ensuing years.
Additionally, except when the cessation is due to fire, flood,
storm or other casualty, the taxpayer must redetermine the amount
of credit allowed in earlier years by reducing the applicable
percentage of cost of the property allowed under section five of
this article, to correspond with the percentage of cost allowable
for the period of time that the qualified tourism development
property was actually used in this state in the business of the
taxpayer. The taxpayer must then file a reconciliation statement
with the annual tax credit reporting schedule filed under section
eight of this article, for the year in which the forfeiture occurs.
If the amount of credit taken exceeds the amount of credit allowed
as redetermined, the taxpayer must pay the recapture tax as
specified in this article. (a) When recapture tax applies. -- (1) If it appears upon audit or otherwise that a taxpayer has
not placed qualified tourism development property into service or
use as represented but has nevertheless taken the credit allowed by
this article, the taxpayer must pay the recapture tax as specified
in this section.(2) Any person who places qualified tourism development
property in service or use in this state, and who fails to use the
qualified tourism development property for at least the period of its useful life (determined as of the time the property was placed
in service or use under section seven of this article), or the
period of time over which tax credits allowed under this article
with respect to such property are applied under this article,
whichever period is less, that person must pay the recapture tax
imposed by subsection (b) of this section. (3) This section does not apply when section twelve of this
article applies. However, the successor, or the successors, and
the person, or persons, who previously claimed credit under this
article with respect to the qualified tourism development property
and the new jobs attributable thereto, are jointly and severally
liable for payment of any recapture tax subsequently imposed under
this section with respect to the qualified tourism development
property and new jobs. (b) Recapture tax imposed. -- The recapture tax imposed by
this section is the amount determined as follows: The taxpayer must recapture an amount of credit equal to the
difference between:(1) The amount of credit claimed under section nine of this
article for the taxable year, and all preceding taxable years; and (2) The amount of credit:(A) That would have been claimed in those years if the amount
of credit allowable under section seven of this article had been
determined based on the qualified tourism development property which remains in service; plus (B) An amount equal to the amount of interest that would have
been imposed on the difference between the amount that was claimed
and the amount that should have been claimed over the period of
time outstanding, in accordance with the interest provisions of
article ten of this chapter, as if that amount were tax underpaid.
In addition, the recapture tax may, at the discretion of the tax
commissioner include an amount equal to the statutory penalties
that can be imposed under article ten of this chapter if it
appears that the taxpayer has engaged in conduct that would have
resulted in the imposition of the penalties in accordance with
article ten of this chapter.(d) Payment of recapture tax. -- The recapture tax imposed
under this section is due and payable on the day the person's
annual return is due for the taxable year in which this section
applies, under article twenty-one or twenty-four of this chapter.
When the employer is a partnership, or S corporation, for federal
income tax purposes, the recapture tax is a joint and several
liability of and must be paid by those persons who are partners in
the partnership, or shareholders in the S corporation, in the
taxable year in which recapture occurs under this section. (e) Imposition of the recapture tax under this article does
not limit or abrogate the authority of the tax commissioner to
audit and assess tax and to administer and audit the application and entitlement to, and calculation of, the credit allowed under
this article in accordance with the provisions of article ten of
this chapter.(f) The provisions of the "West Virginia Tax Procedure and
Administration Act" set forth in article ten of this chapter, apply
to the recapture tax imposed by this article with like effect as if
that act were set forth in extenso in this article, except where it
is expressly and specifically provided in this article that a
particular provision of this article governs and controls. (a) Mere change in form of business. -- Qualified tourism
development property may not be treated as disposed of under
section twelve of this article by reason of a mere change in the
form of conducting the business as long as the qualified investment
property is retained in a business in this state, and the eligible
taxpayer retains a controlling interest in the successor business.
In that event, the successor business is allowed to claim the
amount of credit still available with respect to the business
facility or facilities transferred, and the taxpayer (transferor)
may not be required to redetermine the amount of credit allowed in
earlier years. (b) Transfer or sale to successor. -- Qualified tourism
development property may not be treated as disposed of under
section twelve of this article by reason of any transfer or sale to a successor business which continues to operate the business
facility in this state. Upon transfer or sale, the successor
(transferee) acquires the amount of credit that remains available
under this article for each subsequent taxable year for which the
credit would have been available to the transferor, and the
transferor may not be required to redetermine the amount of credit
allowed in earlier years. §11-13T-15. Identification of qualified tourism development property.
Every taxpayer who claims credit under this article must
maintain sufficient records to establish the following facts for
each item of qualified tourism development property: (1) Its identity; (2) Its actual or reasonably determined cost; (3) Its straight-line depreciation life; (4) The month and taxable year in which it was placed in
service; (5) The amount of credit taken; and (6) The date it was disposed of or otherwise ceased to be
qualified property. §11-13T-16. Failure to keep records of qualified tourism development property.
A taxpayer who does not keep the records required for
identification of qualified tourism development property is subject to the following rules: (1) A taxpayer will be treated as having disposed of, during
the taxable year, any qualified tourism development property which
the taxpayer cannot establish was still on hand, in this state, at
the end of that taxable year. (2) If a taxpayer cannot establish when qualified tourism
development property reported during the taxable year for purposes
of claiming this credit was placed in service, the taxpayer will be
treated as having placed it in service in the most recent prior
year in which similar property was placed in service, unless the
taxpayer can establish that the property placed in service in the
most recent year is still on hand. If that occurs, the taxpayer
will be treated as having placed the returned property in service
in the next most recent year. The tax commissioner must annually publish in the state
register the name and address of every taxpayer asserting this
credit, and the amount of any credit asserted under this article by
each taxpayer; and the confidentiality provisions of section
four-a, article one, or section five-d, article ten of this
chapter, or of any other provision of this code, do not apply to
that information. (a) The tax commissioner may, at his or her discretion, perform joint audits or examinations with the division of tourism
or independently audit or examine the books, records and other
information, as appropriate, of any taxpayer or of any person,
organization or entity which has filed an application for
certification of a project plan under this article, or of any
taxpayer which has asserted this credit, or of any person,
organization or entity believed to have relevant information
relating to this credit, its application, or the taxes against
which the credit may apply. (b) For purposes of joint audits, or any administrative or
judicial proceeding or procedure relating to any tax credit taken,
asserted or sought under this article, the tax commissioner may
share that tax information as the tax commissioner considers
appropriate with the division of tourism, notwithstanding the
provisions of section four-a, article one of this chapter or
section five-d, article ten of said chapter, or any other provision
of this code to the contrary. §11-13T-19. Program evaluation; expiration of credit; preservation of entitlements.
(a) On or before the thirtieth day of September, two thousand
five, the division of tourism must secure an independent review of
the small business tourism development act program as created by
this article and present the findings to the Legislature. The
review shall focus upon: (1) The cost effectiveness of the program;(2) A calculation of the cost of the program per net job
created (net of any jobs lost due to the nonretention of businesses
competing with businesses entitled to the credit allowed under this
article);(3) The jobs creation effectiveness of the program; (4) The value of the program with regard to fostering economic
development, particularly showing any increases in out-of-state
money flowing into West Virginia through tourism and resulting from
the program;(5) The effect of the program on the retention of businesses
that existed in West Virginia prior to the implementation of the
program, and the competitive effect of the credit upon those
businesses. (b) Pursuant to this report, and any independent evaluation
that the Legislature or the joint committee on government
operations may wish to initiate, the joint committee on government
operations must issue a recommendation to the Legislature, not
later than the first day of February, two thousand four, as to
whether the program should continue. (c) Except if continued by act of the Legislature, the small
business tourism development act shall terminate on the first day
of July, two thousand four unless sooner terminated by law.(d) Except if continued by act of the Legislature, no entitlement to the tax credit under this article may result from
any investment in qualified tourism development property placed in
service or use after the first day of July, two thousand six, and
no credit may be available to any taxpayer for any property placed
into service or use after that date. Taxpayers which have gained
entitlement to the credit pursuant to qualified investment in
qualified tourism development property placed in service or use in
certified projects prior to the first day of July, two thousand
six, may retain that entitlement and apply the credit in due
course, provided the requirements and limitations of this article
are otherwise met.Except for the specific exceptions set forth in this article,
from the tax information and tax return information confidentiality
provisions of article ten of this chapter, every provision of the
"West Virginia Tax Procedure and Administration Act" set forth in
article ten of this chapter applies to the credit allowed by this
article with like effect as if the act were applicable only to the
credit and were set forth with respect thereto in extenso in this
article. The tax commissioner shall propose legislative rules as may be
necessary to carry out the purpose of this article and to implement
the intent of the Legislature. The rules shall be promulgated in accordance with the provisions of article three, chapter
twenty-nine-a of this code.NOTE: The purpose of this bill is to create a tax incentive
for the creation, construction or enlargement of tourism
attractions or amenities. The credit operates to allow the
taxpayer to recover up to 25% (or, in the case of bed and breakfast
facilities, 50%) of qualified investment in a tourism attraction or
amenity by offsetting up to 80% of consumers sales and service tax
collected by the taxpayer from customers over a period of either
five or ten years at the election of the taxpayer.This article is new; therefore, strike-throughs and
underscoring have been omitted.