FISCAL NOTE
Date Requested: March 18, 2021
Time Requested: 11:13 AM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2692 |
Engrossed |
SB305 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to create a sales tax exemption from the consumer sales and service tax for purchases of certain services and tangible personal property sold for the repair, remodeling, and maintenance of aircraft; the bill defines terms, specifies a method for claiming exemption, and authorizes emergency rules and the promulgation of legislative rules.
According to our interpretation, the proposed legislation would create a Consumer Sales Tax exemption for purchases of services and tangible personal property sold for the repair, remodeling, and maintenance of aircraft. The legislation would expand on the Consumer Sales Tax exemptions for aircraft repair and maintenance currently in W.Va. Code. These are W.Va. Code §11-15-9p, which exempted repairs and maintenance aircraft operated under a fractional ownership program and W.Va. Code §11-15-9)a)(33) which exempted commercial aircraft and aircraft owned by government entities. The legislation, if passed, would apply to all sales made on or after September 1, 2021. Based on our interpretation, the proposed legislation would decrease General Revenue Fund collections by $450,000 in FY2022 and $600,000 in subsequent fiscal years.
Additional administrative costs incurred by the Tax Department would be $5,000 in FY2022.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2021
Increase/Decrease
(use"-") |
2022
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
5,000 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
5,000 |
0 |
| 2. Estimated Total Revenues |
0 |
-450,000 |
-600,000 |
Explanation of above estimates (including long-range effect):
According to our interpretation, the proposed legislation would create a Consumer Sales Tax exemption for purchases of services and tangible personal property sold for the repair, remodeling, and maintenance of aircraft. The legislation would expand on the Consumer Sales Tax exemptions for aircraft repair and maintenance currently in W.Va. Code. These are W.Va. Code §11-15-9p, which exempted repairs and maintenance aircraft operated under a fractional ownership program and W.Va. Code §11-15-9)a)(33) which exempted commercial aircraft and aircraft owned by government entities. The legislation, if passed, would apply to all sales made on or after September 1, 2021. Based on our interpretation, the proposed legislation would decrease General Revenue Fund collections by $450,000 in FY2022 and $600,000 in subsequent fiscal years.
Additional administrative costs incurred by the Tax Department would be $5,000 in FY2022.
Memorandum
The purpose of this bill is to create a sales tax exemption from the consumer sales and service tax for purchases of certain services and tangible personal property sold for the repair, remodeling, and maintenance of aircraft; the bill defines terms, specifies a method for claiming exemption, and authorizes emergency rules and the promulgation of legislative rules.
The title of the bill is defective in that it limits application of the bill to “aircraft with an empty weight of 6,000 pounds or greater,” but does not carry over this limitation into the body of the bill.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov