Date Requested:February 16, 2005
Time Requested:02:01 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2005R923 Intro SB164
CBD Subject: Exempt High Tech Companies
FUND(S)
General Revenue Fund
Sources of Revenue
General Fund
Legislation creates:
A New Program

Fiscal Note Summary

Effect this measure will have on costs and revenues of state government.

    The stated purpose of this bill is to create sales tax exemptions to encourage high technology companies including: e-commerce vendors, computer software developers, computer hardware designers, systems engineering firms, internet service companies, and electronic data processing companies to locate and expand their businesses in West Virginia and to provide sales exemptions for educational software and internet advertising.
    
    According to our interpretation, passage of this bill would reduce General Revenue Fund collections by at least $7.0 million per year.
    
    Additional administrative costs to the Tax Department would be minimal during the current fiscal year due to notifying taxpayers of these changes.

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2005
Increase/Decrease
(use"-")
2006
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 4,000 0 0
Personal Services 0 0 0
Current Expenses 4,000 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 -7,000,000 -7,000,000
3. Explanation of above estimates (including long-range effect):
    This bill would create sales tax exemptions for high technology companies including: e-commerce vendors, computer software developers, computer hardware designers, systems engineering firms, internet service companies, and electronic data processing companies. Additionally, the bill would provide sales exemptions for educational software and internet advertising.
    
    According to our interpretation, passage of this bill would reduce General Revenue Fund collections by at least $7.0 million per year.
    
    Additional administrative costs to the Tax Department would be $4,000 during the current fiscal year due to notifying taxpayers of these changes.


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kpetry@tax.state.wv.us