FISCAL NOTE
Date Requested: March 11, 2017
Time Requested: 10:51 AM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2855 |
Introduced |
SB579 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
Local Governments
Sources of Revenue:
Other Fund local governments
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 exempt a farm winery from certain taxes on the selling or distribution of wine, when that wine is made on the farm winery and is sold at retail to the public on the premises of the farm winery.
According to our interpretation, the proposed bill states that farm wineries that sell or distribute wine made at the farm winery for sale at retail to the public on the premises of the winery may only be required to collect the local 5 percent wine and liquor tax. It appears the local 5 percent wine and liquor tax would have to be collected by farm wineries acting as a distributor to other retailers, but not on distribution of the wine to itself. As written, the proposed bill would have a minimal impact on local government revenues.
Additional administrative costs to the State Tax Department would be minimal.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2017
Increase/Decrease
(use"-") |
2018
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
1,000 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
1,000 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
According to our interpretation, the proposed bill states that farm wineries that sell or distribute wine made at the farm winery for sale at retail to the public on the premises of the winery may only be required to collect the local 5 percent wine and liquor tax. It appears the local 5 percent wine and liquor tax would have to be collected by farm wineries acting as a distributor to other retailers, but not on distribution of the wine to itself. As written, the proposed bill would have a minimal impact on local government revenues.
Additional administrative costs to the State Tax Department would be minimal.
Memorandum
The stated purpose of this bill is to exempt a farm winery from certain taxes on the selling or distribution of wine, when that wine is made on the farm winery and is sold at retail to the public on the premises of the farm winery.
The proposed bill may introduce a Constitutional concern in that wine made and sold at a farm winery would be subject to less tax than wine sold at a retail establishment from a distributor. It is not entirely clear whether this would be an issue.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov