Date Requested: January 19, 2015
Time Requested: 09:25 AM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
1400 Introduced SB75
CBD Subject: Military and Veterans


FUND(S):

General Revenue Fund, West Virginia Veteran's Program Fund

Sources of Revenue:

General Fund,Special 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 legalize and regulate the selling of fireworks; to create the West Virginia Veterans Program Fund; to impose a special ten percent fee on the sale of fireworks; and to use those proceeds for the Veterans Program Fund.
    
    According to our interpretation, passage of this bill would require the State Tax Commissioner to establish a Fireworks Registration Fee in the amount of $20 to be charged to any retailers desiring to sell fireworks. The Fireworks Registration Fee would be in addition to the current Business Registration Fee. The proposed bill also adds a 10 percent Fireworks Safety Fee in addition to the State Consumer Sales and Service Tax to be added to retail sales of consumer fireworks and items described in proposed bill. The proceeds from the 10 percent Fireworks Safety Fee will be deposited in the West Virginia Veterans Program Fund.
    
    Passage of this bill would result in a net gain of roughly $800,000 to the General Revenue Fund and a gain of $1.3 million to the West Virginia Veterans Program Fund.
    
    Additional administrative costs to the State Tax Department from the passage of this bill would be $15,000.
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2015
Increase/Decrease
(use"-")
2016
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 15,000 15,000
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 15,000 15,000
2. Estimated Total Revenues 0 2,100,000 2,100,000


Explanation of above estimates (including long-range effect):


    According to our interpretation, passage of this bill would require the State Tax Commissioner to establish a Fireworks Registration Fee in the amount of $20 to be charged to any retailers desiring to sell fireworks. The Fireworks Registration Fee would be in addition to the current Business Registration Fee. The proposed bill also adds a 10 percent Fireworks Safety Fee in addition to the State Consumer Sales and Service Tax to be added to retail sales of consumer fireworks and items described in proposed bill. The proceeds from the 10 percent Fireworks Safety Fee will be deposited in the West Virginia Veterans Program Fund.
    
    Passage of this bill would result in a net gain of roughly $800,000 to the General Revenue Fund and a gain of $1.3 million to the West Virginia Veterans Program Fund.
    
    Additional administrative costs to the State Tax Department from the passage of this bill would be $15,000.
    



Memorandum


    The stated purpose of this bill is to legalize and regulate the selling of fireworks; to create the West Virginia Veterans Program Fund; to impose a special ten percent fee on the sale of fireworks; and to use those proceeds for the Veterans Program Fund.
    
    While the bill purports to create a ten percent fee on sales of fireworks, it does not provide for the collection of the fee by the vendor or remittance of the fee to the State Tax Department, nor does it authorize the promulgation of a legislative rule by the State Tax Commissioner for the administration of the new fee. No provision is made for the assessment or collection of delinquent fees.
    
    Although the bill creates a special account in the State treasury for the deposit of the fees, it does not provide for the disposition of the funds accumulated in the new account. Although the stated purpose indicates the purpose is "to use those proceeds for the Veterans Program Fund," it does not state that the purpose is to use the funds for veterans programs.
    
    
    



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