Date Requested:February 27, 2013
Time Requested:01:37 PM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2013R2422 Introduced SB377
CBD Subject: TAX FROM OUT OF STATE RETAILERS
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 require certain retailers located out of state to collect and remit use tax as provided by West Virginia Code §11-15A-6. Those certain retailers are related to persons and entities in the state which perform services related to the tangible personal property or services sold by the retailer.
    
     As written, this bill would modify the definition of “retailer engaging in business in this state” to include those entities that are subsidiaries of, related to, or unitary with a retailer that in cooperation with the retailer: maintains an office, distribution house, sales house, warehouse or other place of business in West Virginia; directly, or by agent, or representative performs services in West Virginia in connection with tangible personal property or services sold by the retailer, or any related entity, related member or part of the unitary business; by agent or representative solicits business in West Virginia for or on behalf of the retailer, or any related entity, related member or part of the unitary business. The proposed modification of the definition, effective June 1, 2013, in conjunction with existing provisions of W. Va. Code §11-15A-1 et seq. would require the retailer to collect the appropriate tax from the purchaser at the time of sale and remit the tax to the State Tax Commissioner.
    
     According to our interpretation, passage of this bill would increase General Revenue Fund deposits by roughly $7 million to $10 million per year compared to current collections. The Governor’s official revenue estimates include the additional collections for FY2014.
    
     Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal.
    

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2013
Increase/Decrease
(use"-")
2014
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 would modify the definition of “retailer engaging in business in this state” to include those entities that are subsidiaries of, related to, or unitary with a retailer that in cooperation with the retailer: maintains an office, distribution house, sales house, warehouse or other place of business in West Virginia; directly, or by agent, or representative performs services in West Virginia in connection with tangible personal property or services sold by the retailer, or any related entity, related member or part of the unitary business; by agent or representative solicits business in West Virginia for or on behalf of the retailer, or any related entity, related member or part of the unitary business. The proposed modification of the definition, effective June 1, 2013, in conjunction with existing provisions of W. Va. Code §11-15A-1 et seq. would require the retailer to collect the appropriate tax from the purchaser at the time of sale and remit the tax to the State Tax Commissioner.
    
     According to our interpretation, passage of this bill would increase General Revenue Fund deposits by roughly $7 million to $10 million per year compared to current collections. The Governor’s official revenue estimates include the additional collections for FY2014.
    
     Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal.
    


Memorandum
Person submitting Fiscal Note:
Mark B. Muchow
Email Address:
Roger.D.Cox@wv.gov