Date Requested:February 06, 2008
Time Requested:05:05 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2008R1912 Introduced HB4421
CBD Subject: REPEAL CORPORATE LICENSE TAX
FUND(S)
General Revenue Fund
Sources of Revenue
General Fund
Legislation creates:
Neither Program nor Fund

Fiscal Note Summary

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

    The stated purpose of this bill is to repeal the complicated and confusing corporate license tax, and to replace the resulting loss of revenues by the Office of the Secretary of State by creating a new one-time $100 filing fee, and by permitting the Secretary of State to keep all of the $25 annual attorney-in-fact fees paid by corporations and limited partnerships.
    
    According to our interpretation, passage of this bill would result in a decline in the General Revenue Fund as shown in the table below.
    
    General Revenue Fund
    
    FY2009 ($6.4 million)
    
    FY2010 ($6.7 million)
    
    FY2011 ($6.8 million)
    
    FY2012 ($7.0 million)
    
    FY2013 ($7.1 million)
    
    Passage of this bill would result in administrative cost savings to the State Tax Department of roughly $30,000 in the current fiscal year due to decreased costs in postage and $42,000 each year thereafter due to decreased costs in postage and for temporary personnel.

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2008
Increase/Decrease
(use"-")
2009
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost -30,000 -42,000 -42,000
Personal Services 0 -12,000 -12,000
Current Expenses -30,000 -30,000 -30,000
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 -6,400,000 -7,100,000
3. Explanation of above estimates (including long-range effect):
    According to our interpretation, passage of this bill would result in a decline in the General Revenue Fund as shown in the table below.
    
    General Revenue Fund
    
    FY2009 ($6.4 million)
    
    FY2010 ($6.7 million)
    
    FY2011 ($6.8 million)
    
    FY2012 ($7.0 million)
    
    FY2013 ($7.1 million)
    
    Passage of this bill would result in administrative cost savings to the State Tax Department of roughly $30,000 in the current fiscal year due to decreased costs in postage and $42,000 each year thereafter due to decreased costs in postage and for temporary personnel.
    


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kpetry@tax.state.wv.us
    The stated purpose of this bill is to repeal the complicated and confusing corporate license tax, and to replace the resulting loss of revenues by the Office of the Secretary of State by creating a new one-time $100 filing fee, and by permitting the Secretary of State to keep all of the $25 annual attorney-in-fact fees paid by corporations and limited partnerships.
    
    The proposed bill’s title refers to the repeal of current W. Va. Code §11-12C-5, and the proposed bill text repeals “the provisions of the other sections of this article as enacted in” 1992. Thus the subsection calling for the payment of an annual attorney-in-fact is repealed. Yet the proposed bill calls for the attorney-in-fact fee to be a component of the “replacement fees” set out in proposed W. Va. Code §11-12E-1(2).