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Introduced Version House Bill 4421 History

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hb4421 intr
H. B. 4421


(By Delegates White and Kominar)
[Introduced February 5, 2008; referred to the
Committee on Finance.]




A BILL to repeal §11-12C-1, §11-12C-2, §11-12C-3, §11-12C-4, §11-12C-5, §11-12C-6, §11-12C-7, §11-12C-8, §11-12C-9, §11-12C-10 and §11-12C-12 of the Code of West Virginia, 1931, as amended; to amend and reenact §11-12C-11 of said code; and to amend said code by adding thereto a new article, designated §11-12E-1, §11-12E-2, §11-12E-3, §11-12E-4, §11-12E-5, §11-12E-6, §11-12E-7, §11-12E-8 and §11-12E-9, all relating to the repeal of the corporate license tax; creating an initial registration fee; and permitting the Secretary of State to retain all of the attorney-in-fact fees collected.

Be it enacted by the Legislature of West Virginia:
That §11-12C-1, §11-12C-2, §11-12C-3, §11-12C-4, §11-12C-5, §11-12C-6, §11-12C-7, §11-12C-8, §11-12C-9, §11-12C-10 and §11-12C-12 of the Code of West Virginia, 1931, as amended, be repealed; that §11-12C-11 of said code be amended and reenacted; and that said code be amended by adding thereto a new article, designated §11-12E-1, §11-12E-2, §11-12E-3, §11-12E-4, §11-12E-5, §11-12E-6, §11-12E-7, §11-12E-8 and §11-12E-9, all to read as follows:
ARTICLE 12C. CORPORATE LICENSE TAX.
§11-12C-11. Effective date.
(a) The provisions of this article as enacted in one thousand nine hundred ninety-two shall take effect on the first day of July, one thousand nine hundred ninety-three, and apply to license tax years beginning the first day of July, one thousand nine hundred ninety-three and thereafter, but the license tax shall cease to apply after the license tax year ending on the thirtieth day of June, two thousand eight.
(b) Tax liabilities, if any, arising for taxable years ending prior to the first day of July, one thousand nine hundred ninety- three, shall be determined, administered, assessed and collected as if sections seventy-six through eighty-four and eighty-six through ninety-one, article twelve of this chapter had not been repealed; and the rights and duties of the taxpayer and the State of West Virginia thereunder shall be fully and completely preserved.
(c) The provisions of the other sections of this article as enacted in one thousand nine hundred ninety-two, and to the extent any of those sections were amended, are repealed effective the first day of July, two thousand eight. However, any liability for the corporate license tax for any and all taxable years or portions thereof ending before the first day of July, two thousand eight shall be determined, administered, assessed, collected and enforced as if the tax has not been terminated; and the rights and duties of the taxpayer and the State of West Virginia with respect to that tax shall be fully preserved. Such taxpayers shall file their final annual corporate license tax return as provided by applicable former sections of article twelve-c as they existed prior to their repeal.
ARTICLE 12E. CORPORATE LICENSE TAX REPLACEMENT FEES.
§11-12E-1. Definitions.
As used in this article:
(1) "Business activity" means all activities engaged in or caused to be engaged in with the object of gain or economic benefit, direct or indirect, but does not mean any of the activities of foreign corporations enumerated in subsections (b), section one thousand five hundred one, article fifteen, chapter thirty-one-d of this code, except for the activity of conducting affairs in interstate commerce when activity occurs in this state.
(2) "Corporate license tax replacement fees" or "replacement fees" or "fees" means the annual fee payable to the Secretary of State as attorney-in-fact and the one-time initial registration fee for administering the annual report filing requirements of this article.
(3) "Corporation" means a "domestic corporation", a "foreign corporation" or a "nonprofit corporation".
(4) "Domestic corporation" means a corporation for profit which is not a foreign corporation incorporated under or subject to the provisions of chapter thirty-one-d of this code.
(5) "Foreign corporation" means a for-profit corporation incorporated under a law other than the laws of this state.
(6) "Initial registration fee" means a one hundred dollar fee that is to be paid to the Secretary of State the first time an entity pays the twenty-five dollar annual attorney-in-fact fee.
(7) "Limited partnership" means a partnership as defined by section one, article nine, chapter forty-seven of this code.
(8) "Nonprofit corporation" means a nonprofit corporation as defined by section one hundred fifty, article one, chapter thirty- one-e of this code.
§11-12E-2. Payment of fee required.
On or after the first day of July, two thousand eight, no domestic corporation or foreign corporation may engage in any business activity in this state without paying the replacement fees and filing the information return required by section three. No nonprofit corporation may engage in any activity in this state without paying those fees and filing that return.
§11-12E-3. Payment and collection of fees; deposit of money; return required.

(a)
Payment and collection of fees. -- When application is made to the Secretary of State for a certificate of incorporation or authority to do business in this state, the applicant shall pay the replacement fees due under this article for the first year, and the Secretary of State shall collect the fees before issuing the certificate. Thereafter, on or before the first day of the next fiscal year following the date of the certificate, and on or before the first day of each succeeding fiscal year, the corporation shall pay and the Secretary of State shall collect the annual fee for a full year: Provided, That if the application is made on or after the first day of the second month preceding the beginning of the next fiscal year, and before the first day of the year, the Secretary of State shall also collect the annual fee for the full year beginning on the first day of the next fiscal year.
(b)
Deposit of money. -- The fees received by the Secretary of State pursuant to the provisions of this article shall be deposited by the Secretary of State in the service fees and collections account established by section two, article one, chapter fifty-nine of this code, and such fees when deposited shall not thereunder be expired or cause to be expired any moneys into the General Revenue Fund of the State Treasury in the manner provided by law.
(c)
Returns. -- Payment of the fees required under the provisions of this section shall be accompanied by a return on forms provided by the Secretary of State for that purpose. The return shall contain: (1) The address of the corporation's principal office; (2) the names and mailing addresses of its officers and directors; (3) the name and mailing address of the person on whom notice of process may be served; (4) the name and address of the corporation's parent corporation and of each subsidiary of the corporation licensed to do business in this state; (5) the county or county code in which the principal office address or mailing address of the company is located; (6) business class code; and (7) any other information the Secretary of State considers appropriate.
Notwithstanding any other provision of law to the contrary, the Secretary of State shall, upon request of any person, disclose: (1) The address of the corporation's principal office; (2) the names and addresses of its officers and directors; (3) the name and mailing address of the person on whom notice of process may be served; (4) the name and address of each subsidiary of the corporation and the corporation's parent corporation; (5) the county or county code in which the principal office address or mailing address of the company is located; and (6) the business class code.
§11-12E-4. Due date of return; payment of fees.
It shall be the duty of each corporation required to pay the fees imposed under this article to remit them with a properly completed return to the Secretary of State, and if it fails to do so it shall be subject to the penalties prescribed in section seven of this article.
§11-12E-5. Monthly report by Secretary of State to Tax Commissioner as to corporations.

The Secretary of State shall, within twenty days after the close of each month, make a report to the Tax Commissioner for the preceding month, in which he or she shall set out the name of every corporation to which he or she issued a certificate of incorporation during the month, as well as the name of each corporation to which he or she issued a certificate of authority. He or she shall set out in the report the names of all corporations to which he or she issued certificates of change of name or of change of location of principal office, dissolution, withdrawal or merger; if he or she fails to do so, it shall be the duty of the Tax Commissioner to report such failure to the Governor.
§11-12E-6. Administrative and criminal penalties.
The following penalties shall be in addition to any other penalties and remedies available elsewhere in this code:
(a)
Administrative penalty. -- The Secretary of State shall impose upon each delinquent corporation a fine in the amount of one hundred dollars per year for each year or portion thereof in which the return which is due is not filed or the fees which are owed are not paid. This penalty shall be assessed and collected in the same manner as the fees imposed under this article.
(b)
Criminal penalty. -- It shall be a misdemeanor for a corporation to conduct business for more than thirty consecutive calendar days without paying in full the amount of fees which are due and filing the return which is due. The penalty for any officer, agent or employee convicted of such offense shall be a fine of not more than one thousand dollars per conviction.
(c)
Revocation of certificate of incorporation or certificate of authority. -- Upon the establishment of a finalized liability for any fees due and owing, not subject to further administrative or judicial review, the certificate of incorporation in the case of a domestic corporation, or the certificate of authority in the case of a foreign corporation, shall be revoked. Any corporation whose certificate of incorporation or certificate or authority has been revoked due to nonpayment of its fees shall be reinstated to its former rights as if it had not been delinquent upon payment to the Secretary of State of all delinquent fees, plus any penalties accruing thereon.
(d) All penalties collected under this section shall be deposited into the General Revenue Fund of the State Treasury in the manner provided by law.
§11-12E-7. Disposition of fees collected.
All fees collected under the provisions of this article shall be paid into the State Treasury in the manner provided by law.

§11-12E-8. Severability.
If any provision of this article or the application thereof to any person or circumstance is for any reason adjudged by any court of competent jurisdiction to be unconstitutional or otherwise invalid, such judgment may not affect, impair or invalidate the remainder of the article, but shall be confined in its operation to the provision thereof directly involved in the controversy in which such judgment has been rendered, and the applicability of other provisions may not be affected thereby.
§11-12E-9. Rules.
The Secretary of State shall promulgate rules, including emergency rules, as he or she considers necessary to implement the provisions of this article.




NOTE: The 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.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.


Article 12E is new; therefore, strike-throughs and underscoring have been omitted.
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