Date Requested:January 27, 2012
Time Requested:02:25 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2012R1721 Introduced HB4335
CBD Subject: STREAMLINED SALES AND USE TAX AGREEMENT
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 update code provisions to conform to the Streamlined Sales Tax Agreement. The bill adds new definitions and clarifies present definitions. The bill incorporates changes to the Streamlined Sales and Use Tax Agreement and adds computer software maintenance contracts as a Streamlined Sales and Use Tax Agreement. The bill also relieves a seller of the tax liability in certain instances, eliminates monetary allowances for certain sellers, provides new effective dates, clarifies state administration of state and local sales and use taxes, bases and exemptions.
    
    As written, this bill will update West Virginia’s Sales and Use Tax Administration Law with the Streamlined Sales and Use Tax Agreement, as in effect prior to January 31, 2012. The bill clarifies administration of the sales and use tax by adding definitions for “computer software maintenance contract” (with further delineation of “mandatory computer software maintenance contract” and “optional computer maintenance contract”), “delivered electronically,” and “Model IV seller.” The bill also adds a provision concerning the administration of exemptions. Generally, a seller is required to obtain an exemption certificate from a purchaser claiming an exemption from tax. For transactions for which the State Tax Commissioner requests substantiation of an exempt sale, the seller is relieved of any liability for the tax if the seller obtains the necessary supporting documentation, unless it is discovered that the seller had knowledge or had reason to know the information relating to the exemption was materially false. According to our interpretation, passage of this bill will have no impact on State revenue.
    
    Additional administrative costs to the State Tax Department associated with this bill will be minimal.
    
    

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2012
Increase/Decrease
(use"-")
2013
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 0 0
3. Explanation of above estimates (including long-range effect):
    Passage of this bill will update West Virginia’s Sales and Use Tax Administration Law with the Streamlined Sales and Use Tax Agreement, as in effect prior to January 31, 2012. The bill clarifies administration of the sales and use tax by adding definitions for “computer software maintenance contract” (with further delineation of “mandatory computer software maintenance contract” and “optional computer maintenance contract”), “delivered electronically,” and “Model IV seller.” The bill also adds a provision concerning the administration of exemptions. Generally, a seller is required to obtain an exemption certificate from a purchaser claiming an exemption from tax. For transactions for which the State Tax Commissioner requests substantiation of an exempt sale, the seller is relieved of any liability for the tax if the seller obtains the necessary supporting documentation, unless it is discovered that the seller had knowledge or had reason to know the information relating to the exemption was materially false. According to our interpretation, passage of this bill will have no impact on State revenue.
    
    Additional administrative costs to the State Tax Department associated with this bill will be minimal.
    


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kerri.r.petry@wv.gov