H. B. 3198
(By Delegates Kessler, Burdiss and Martin)
[Introduced January 9, 2008; referred to the
Committee on Finance.]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new article, designated §11-14D-1 and
§11-14D-2, all relating to enacting the West Virginia Windfall
Profit Tax Act; providing a short title; defining "windfall
profit"; providing the tax applies to all corporations selling
petroleum products in the state; providing the tax cannot be
passed onto the consumer; requiring corporations to report on
a quarterly basis net profits; providing the Attorney General
in collaboration with the Secretary of State and the State Tax
Commissioner are responsible to determine accuracy of reported
net profits and to see to the collection of the tax; vesting
the Attorney General with subpoena power to obtain corporate
records; providing certain consequences when the Attorney
General requests production of records and a corporation fails
to provide the requested records; providing the Attorney General in collaboration with the State Tax Commissioner may
enlist forensic accounting procedures to determine tax
liability; providing the rate of tax; providing civil
penalties against corporations who attempt to recoup sums paid
as a result of the tax by passing price increases to
consumers; requiring corporations to pay the tax within thirty
days of notification of the amount due or face the prospect of
confiscation and forfeiture of corporate property in a civil
proceeding instituted by the Attorney General; and, directing
the Secretary of State in collaboration with the State Tax
Commissioner to propose rules for legislative approval to
implement the act's provisions.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §11-14D-1 and
§11-14D-2, all to read as follows:
ARTICLE 14D. WINDFALL PROFIT TAX ACT.
§11-14D-1. Short title; nature of tax.
(a) This article shall be known and may be cited as the
"Windfall Profit Tax Act".
(b) Any corporation doing business in this state selling oil,
gasoline, diesel fuel, jet fuel, heating oil, natural gas, propane
gas or any other petroleum or fossil fuel product shall be subject
to the provisions of this article.
(c) For purposes of this article, the term "windfall profit"
means a profit in excess of ten percent of net profit when compared
to net profit from the immediately preceding year, made by any
corporation subject to the terms of this article.
§11-14D-2. Imposition of tax.
(a) Any corporation subject to the provisions of this article
that obtains a windfall profit as that term is defined in
subsection (c), section one of this article shall be subject to a
tax of an additional ten cents per gallon or per cubic foot,
whichever unit of measure applies, in addition to the applicable
excise tax under the provisions of article fourteen-c of this
chapter. The additional tax may not be assessed, collected or
otherwise passed back onto the ultimate consumer but shall be
payable directly from the corporation.
(b) Every corporation subject to the provisions of this
article shall report on a quarterly basis to the Department of
Revenue on forms provided by the department concerning the amount
of its net profit relative to the immediately preceding year. The
Attorney General in collaboration with the Secretary of State and
the Tax Commissioner shall be responsible to corroborate the
accuracy of corporate returns filed under the provisions of this
article and to collect the tax. The Attorney General is hereby
vested with subpoena power to obtain records and testimony from
corporate officers to ascertain the accuracy of returns made. In the event the Attorney General requests corporate records relating
to sales made in this state within a specific time period and the
corporation does not provide the records, the corporation shall be
deemed as having accepted projected net sales profits as prescribed
by the Attorney General's Office in collaboration with the State
Tax Commissioner: Provided, That any projection of net sales shall
be made in accordance with acceptable forensic accounting
principles and procedures obtained by persons possessing minimum
qualifications as licensed and duly certified public accountants.
(c) Once the Department of Revenue determines a corporation
has obtained a windfall profit, it shall assess, in addition to any
other tax assessed, a tax of ten cents on each gallon or cubic
foot, whichever unit of measure applies, of any product subject to
the provisions of this article, sold by the corporation in this
state during the applicable tax period.
(d) In the event clear and convincing evidence exists that a
corporation subject to the provisions of this section has recouped
or attempted to recoup the cost of the tax imposed hereunder or any
portion thereof from additional price increases passed upon
wholesale or retail consumers, the corporation will be liable for
a civil fine of two hundred fifty thousand dollars.
(e) Upon a determination that taxes are due under the
provisions of this article, the Tax Commissioner shall calculate
the amount due and payable which sum shall be paid within thirty days from the date notice of the tax due is received by the
corporation by providing the notice to its duly appointed agent in
this state for service of process. In the event the corporation
fails to pay the tax provided herein or fails to pay any civil fine
imposed under the provisions of subsection (d) of this section, the
State Attorney General is hereby authorized to commence a civil
proceeding intended to confiscate and forfeit any corporate assets
situate in this state in satisfaction of the tax that is due or the
civil fine that has been assessed.
(f) The Secretary of State in collaboration with the State Tax
Commissioner is hereby directed to propose rules for legislative
approval in accordance with the provisions of article three,
chapter twenty-nine-a of this code designed to fully implement the
provisions of this article.
NOTE: The purpose of this bill is to
create the West Virginia
Windfall Profit Tax Act. The bill includes provisions defining
"windfall profit" while providing the tax applies to all
corporations selling natural gas or petroleum products in the
state. The bill provides the tax cannot be passed onto consumers
and requires corporations to report on a quarterly basis net
profits. Other provisions contained in the bill include: (1)
Providing the Attorney General in collaboration with the Secretary
of State and the State Tax Commissioner are responsible to
determine accuracy of reported net profits and to insure the
collection of the tax; (2) vesting the Attorney General with
subpoena power to obtain corporate records; (3) providing certain
consequences when the Attorney General requests production of
records and a corporation fails to provide the requested records;
(4) providing the Attorney General in collaboration with the State
Tax Commissioner may enlist forensic accounting procedures to
determine tax liability; (5) providing the rate of tax; (6) providing civil penalties against corporations who attempt to
recoup sums paid as a result of the tax by passing price increases
to consumers; (7) requiring corporations to pay the tax within
thirty days of notification of the amount due or face the prospect
of confiscation and forfeiture or corporate property in a civil
proceeding instituted by the Attorney General; and, (8) directing
the Secretary of State in collaboration with the State Tax
Commissioner to propose rules for legislative approval in implement
the act's provisions.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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