COMMITTEE SUBSTITUTE
FOR
H. B. 4335
(By Delegates H. White and Campbell, Kominar)
(Originating in the Committee on Finance)
[February 18, 2010]
A BILL to amend and reenact §11-12-5 of the Code of West Virginia,
1931, as amended, relating to the business registration tax
generally; specifying the business registration tax and
business registration certificate are subject to exemptions;
and specifying that the tax is imposed for each and every
issuance, reissuance or reinstatement of a business
registration certificate.
Be it enacted by the Legislature of West Virginia:
That §11-12-5 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 12. BUSINESS REGISTRATION TAX.
§11-12-5. Time for which registration certificate granted; power
of Tax Commissioner to suspend or cancel certificate;
certificate to be permanent until cessation of
business for which certificates are granted or
revocation, suspension or cancellation by the Tax Commissioner; penalty for involuntary loss of license
due to failure to pay required fees and taxes relating
to business.
(a)
Registration period. -- All business registration
certificates issued under the provisions of section four of this
article are for the period of one year beginning July 1 and ending
the thirtieth day of the following June June 30 of the following
year: Provided, That beginning on or after July 1, 1999, all
business registration certificates issued under the provisions of
section four of this article shall be issued for two fiscal years
of this state, subject to the following transition rule. If the
first year for which a business was issued a business registration
certificate under this article began on July 1 of an even-numbered
calendar year, then the Tax Commissioner may issue a renewal
certificate to that business for the period beginning July 1, 1999,
and ending June 30, 2000, upon receipt of $15 for each such
one-year certificate. Notwithstanding any other provisions of this
code to the contrary, any certificate of registration granted on or
after July 1, 2010, shall not be subject to the foregoing
requirement that it be renewed, but shall be permanent until
cessation of the business for which the certificate of registration
was granted or until it is suspended, revoked or cancelled by the
Tax Commissioner. Notwithstanding any provision of this code to
the contrary, on or after July 1, 2010, reference to renewal of the
business registration certificate shall refer to the issuance of a new business registration certificate pursuant to expiration,
cancellation or revocation of a prior business registration
certificate or to reinstatement of a business registration
certificate or to reinstatement of a business certificate
previously suspended by the Tax Commissioner.
Subject to the
exemptions, exceptions and requirements set forth in section three
of this article, on or after July 1, 2010, the business
registration certificate shall be issued upon payment of a tax of
$30 to the Tax Commissioner for new issuances of the business
registration certificate or for issuances of the business
registration certificate pursuant to expiration, cancellation or
revocation of a prior business registration certificate or for
reinstatement of a business registration certificate previously
suspended by the Tax Commissioner, along with any applicable
delinquent fees, interest, penalties and additions to tax.
Subject
to the exemptions, exceptions and requirements set forth in section
three of this article, the $30 tax shall be paid each and every
time there is an issuance, reissuance or reinstatement of a
business registration certificate, along with any applicable
delinquent fees, interest, penalties and additions to tax.
(b)
Revocation or suspension of certificate. --
(1) The Tax Commissioner may cancel or suspend a business
registration certificate at any time during a registration period
if:
(A) The registrant filed an application for a business
registration certificate, or an application for renewal thereof, that was false or fraudulent.
(B) The registrant willfully refused or neglected to file a
tax return or to report information required by the Tax
Commissioner for any tax imposed by or pursuant to this chapter.
(C) The registrant willfully refused or neglected to pay any
tax, additions to tax, penalties or interest, or any part thereof,
when they became due and payable under this chapter, determined
with regard to any authorized extension of time for payment.
(D) The registrant neglected to pay over to the Tax
Commissioner on or before its due date, determined with regard to
any authorized extension of time for payment, any tax imposed by
this chapter which the registrant collects from any person and
holds in trust for this state.
(E) The registrant abused the privilege afforded to it by
article fifteen or fifteen-a of this chapter to be exempt from
payment of the taxes imposed by such articles on some or all of the
registrant's purchases for use in business upon issuing to the
vendor a properly executed exemption certificate, by failing to
timely pay use tax on taxable purchase for use in business or by
failing to either pay the tax or give a properly executed exemption
certificate to the vendor.
(F) The registrant has failed to pay in full delinquent
personal property taxes owing for the calendar year.
(2) On or after July 1, 2010, a prospective registrant or a
former registrant for which a business registration certificate has
been suspended, cancelled or revoked pursuant to the provisions of this article may apply for a new business registration certificate
or for reinstatement of a suspended business registration
certificate upon payment of all outstanding delinquent fees, taxes,
interest, additions to tax and penalties, in addition to payment to
the Tax Commissioner of a penalty in the amount of $100. The Tax
Commissioner may issue a new business registration certificate or
reinstate a suspended business registration certificate if the
prospective or former registrant has provided security acceptable
to and authorized by the Tax Commissioner, payable to the Tax
Commissioner, sufficient to secure all delinquent fees, taxes,
interest, additions to tax and penalties owed by the prospective
registrant. The Tax Commissioner may issue a new business
registration certificate or reinstate a suspended business
registration certificate if the prospective or former registrant
has entered into a payment plan approved by the Tax Commissioner by
which liability for all delinquent fees, taxes, interest, additions
to tax and penalties will be paid in due course and without
significant delay. Failure of any registrant to comply with a
payment plan pursuant to this provision shall be grounds for
immediate suspension or revocation of the registrant's business
registration certificate.
(3) On and after July 1, 2010, a prospective registrant or a
former registrant for which a business registration certificate has
been suspended, cancelled or revoked pursuant to the provisions of
any article of this code other than this article may apply for a
new business registration certificate or for reinstatement of a suspended business registration certificate, only if the
prospective or former registrant has complied with all applicable
statutory and regulatory requirements for renewal, issuance or
reinstatement of the business registration certificate and upon
payment to the Tax Commissioner of a penalty in the amount of $100.
(4) Except pursuant to exceptions specified in this code,
before canceling, revoking or suspending any business registration
certificate, the Tax Commissioner shall give written notice of his
or her intent to suspend, revoke or cancel the business
registration certificate of the taxpayer, the reason for the
suspension, revocation or cancellation, the effective date of the
cancellation, revocation or suspension and the date, time and place
where the taxpayer may appear and show cause why such business
registration certificate should not be canceled, revoked or
suspended. This written notice shall be served on the taxpayer in
the same manner as a notice of assessment is served under article
ten of this chapter, not less than twenty days prior to the
effective date of the cancellation, revocation or suspension. The
taxpayer may appeal cancellation, revocation or suspension of its
business registration certificate in the same manner as a notice of
assessment is appealed under article ten-a of this chapter. The
filing of a petition for appeal does not stay the effective date of
the suspension, revocation or cancellation. A stay may be granted
only after a hearing is held on a motion to stay filed by the
registrant upon finding that state revenues will not be jeopardized
by the granting of the stay. The Tax Commissioner may, in his or her discretion and upon such terms as he or she may specify, agree
to stay the effective date of the cancellation, revocation or
suspension until another date certain.
(5) On or before July 1, 2005, the Tax Commissioner shall
propose for promulgation legislative rules establishing ancillary
procedures for the Tax Commissioner's suspension of business
registration certificates for failure to pay delinquent personal
property taxes pursuant to paragraph (F), subdivision (1) of this
section. The rules shall at a minimum establish any additional
requirements for the provision of notice deemed necessary by the
Tax Commissioner to meet requirements of law; establish protocols
for the communication and verification of information exchanged
between the Tax Commissioner, sheriffs and others; and establish
fees to be assessed against delinquent taxpayers that shall be
deposited into a special fund which is hereby created and expended
for general tax administration by the Tax Division of the
Department of Revenue and for operation of the Tax Division. Upon
authorization of the Legislature, the rules shall have the same
force and effect as if set forth herein. No provision of this
subdivision may be construed to restrict in any manner the
authority of the Tax Commissioner to suspend such certificates for
failure to pay delinquent personal property taxes under paragraph
(C) or (F), subdivision (1) of this section or under any other
provision of this code prior to the authorization of the rules.
(c)
Refusal to renew. --The Tax Commissioner may refuse to
issue or renew a business registration certificate if the registrant is delinquent in the payment of any tax administered by
the Tax Commissioner under article ten of this chapter or the
corporate license tax imposed by article twelve-c of this chapter,
until the registrant pays in full all the delinquent taxes
including interest and applicable additions to tax and penalties.
In his or her discretion and upon terms as he or she specifies, the
Tax Commissioner may enter into an installment payment agreement
with the taxpayer in lieu of the complete payment. Failure of the
taxpayer to fully comply with the terms of the installment payment
agreement shall render the amount remaining due thereunder
immediately due and payable and the Tax Commissioner may suspend or
cancel the business registration certificate in the manner provided
in this section.
(d)
Refusal to renew due to delinquent personal property tax.
-- The Tax Commissioner shall refuse to issue or renew a business
registration certificate when informed in writing, signed by the
county sheriff, that personal property owned by the applicant and
used in conjunction with the business activity of the applicant is
subject to delinquent property taxes. The Tax Commissioner shall
forthwith notify the applicant that the commissioner will not act
upon the application until information is provided evidencing that
the taxes due are either exonerated or paid.
(e)
Refusal to issue, revocation, suspension and refusal to
renew business registration certificate of alter ego, nominee or
instrumentality of a business that has previously been the subject
of a lawful refusal to issue, revocation, suspension or refuse to renew. --
(1) The Tax Commissioner may refuse to issue a business
registration certificate, or may revoke a business registration
certificate or may suspend a business registration certificate or
may refuse to renew a business registration certificate for any
business determined by the Tax Commissioner to be an alter ego,
nominee or instrumentality of a business that has previously been
the subject of a lawful refusal to issue a business registration
certificate or of a lawful revocation, suspension or refusal to
renew a business registration certificate pursuant to this section,
and for which the business registration certificate has not been
lawfully reinstated or reissued.
(2) For purposes of this section, a business is presumed to be
an alter ego, nominee or instrumentality of another business or
other businesses if:
(A) More than twenty percent of the real assets or more than
twenty percent of the operating assets or more than twenty percent
of the tangible personal property of one business are or have been
transferred to the other business or businesses, or are or have
been used in the operations of the other business or businesses, or
more than twenty percent of the real assets or more than twenty
percent of the operating assets or more than twenty percent of the
tangible personal property of one business are or have been used to
collateralize or secure debts or obligations of the other business
or businesses;
(B) Ownership of the businesses is so configured that the attribution rules of either Internal Revenue Code section 267 or
Internal Revenue Code section 318 would apply to cause ownership of
the businesses to be attributed to the same person or entity; or
(C) Substantive control of the businesses is held or retained
by the same person, entity or individual, directly or indirectly,
or through attribution under paragraph (B) of this subdivision.