ENGROSSED

Senate Bill No. 2011

(By Senators Tomblin, Mr. President, and Sprouse,

By Request of the Executive)

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[Introduced November 9, 2006; referred to the Committee on Finance.]

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A BILL to amend and reenact §11-15-8d of the Code of West Virginia, 1931, as amended, relating to an exemption from consumers sales and service tax for purchases by a contractor when the purchased materials will be used or consumed in the construction, alteration, repair or improvement of a new or existing building or structure to be used primarily for manufacturing.

Be it enacted by the Legislature of West Virginia:
That §11-15-8d of the Code of West Virginia, 1931, as amended, be amended and reenacted to read as follows:
ARTICLE 15. CONSUMERS SALES AND SERVICE TAX.
§11-15-8d. Limitations on right to assert exemptions. Persons who perform "contracting" as defined in section two of this article, or persons acting in an agency capacity, may not assert any exemption to which the purchaser of such contracting services or the principal is entitled. Any statutory exemption to which a taxpayer may be entitled shall be invalid unless the tangible personal property or taxable service is actually purchased by such taxpayer and is directly invoiced to and paid by such taxpayer: Provided, That this section shall not apply to purchases by an employee for his or her employer; purchases by a partner for his or her partnership; or purchases by a duly authorized officer of a corporation, or unincorporated organization, for his or her corporation or unincorporated organization, so long as the purchase is invoiced to and paid by such employer, partnership, corporation or unincorporated organization: Provided, however, That effective the first day of July, two thousand seven, this section shall not apply to purchases by a person performing "contracting," as defined in section two of this article, of services, machinery, supplies or materials, except gasoline and special fuel, to be directly used or consumed in the construction, alteration, repair or improvement of a new or existing building or structure to be primarily used for manufacturing, including the generation of electric power, if the manufacturer that is the purchaser of the "contracting" services would be entitled to claim such exemption under subdivision (2), subsection (b), section nine of this article.
Transition rule. -- This section shall not apply to purchases of tangible personal property or taxable services in fulfillment of a purchasing agent or procurement agent contract executed and legally binding on the parties thereto prior to the fifteenth day of September, one thousand nine hundred ninety: Provided, That this transition rule shall not apply to any purchases of tangible personal property or taxable services made under such a contract after the thirty-first day of August, one thousand nine hundred ninety-one; and this transition rule shall not apply if the primary purpose of the purchasing agent or procurement agent contract was to avoid payment of consumers sales and use taxes.