ENROLLED
COMMITTEE SUBSTITUTE
FOR
H. B. 2999
(By Delegates White, Campbell, Kominar,
Doyle and Carmichael)
[Passed April 10, 2009; in effect from passage.]
AN ACT to amend and reenact §11-15-6 of the Code of West Virginia,
1931, as amended; to amend and reenact §11-15A-18 of said
code; and to amend and reenact §11-15B-21, §11-15B-24, §11-
15B-28 and §11-15B-32 of said code, all relating to the
streamlined sales and use tax agreement and the West Virginia
consumers sales and service tax and use tax; providing relief
from liability in specified circumstances; administrative
exemptions; the requirements of certified service providers
and the effective date.
Be it enacted by the Legislature of West Virginia:
That §11-15-6 of the Code of West Virginia, 1931, as amended,
be amended and reenacted; that §11-15A-18 of said code be amended
and reenacted; and that §11-15B-21, §11-15B-24, §11-15B-28 and §11-
15B-32 of said code be amended and reenacted, all to read as
follows:
ARTICLE 15. CONSUMERS SALES AND SERVICE TAX.
§11-15-6. Vendor must show sale or service exempt; presumption.
(a) The burden of proving that a sale or service was exempt
from the tax shall be upon the vendor, unless the vendor takes from
the purchaser an exemption certificate signed by and bearing the
address of the purchaser and setting forth the reason for the
exemption and substantially in the form prescribed by the tax
commissioner.
(b) To prevent evasion, it is presumed that all sales and
services are subject to the tax until the contrary is clearly
established.
ARTICLE 15A. USE TAX.
§11-15A-18. Seller must show sale not at retail; presumption.
(a) The burden of proving that a sale was not taxable shall be
upon the seller, unless, the seller, in good faith, takes from the
purchaser a certificate signed by and bearing the address of the
purchaser setting forth the reason for exemption of the sale from
imposition of the tax.
(b) Notwithstanding subsection (a) of this section, a seller
is relieved of the good faith requirement for the taking of an
exemption certificate in accordance with article fifteen-b of this
chapter, and any rule promulgated by the Tax Commissioner.
(c) To prevent evasion it is presumed that all proceeds are
subject to the tax until the contrary is clearly established.
(d) This certificate shall be substantially in the form
prescribed by the Tax Commissioner.
ARTICLE 15B. STREAMLINED SALES AND USE TAX ADMINISTRATION ACT.
§11-15B-21. Notice for state tax changes.
(a)
General. -- The Tax Commissioner shall provide sellers
with as much advance notice as practicable of a rate change for a
tax levied by article fifteen or fifteen-a of this chapter.
(b)
Effective date of rate changes. -- Unless the Legislature
expressly provides a different effective date for a rate change,
the change shall take effect on the first day of the calendar
quarter that begins on or after the effective date of the act of
the Legislature that makes the rate change and that is more than
sixty days after passage of the bill making the rate change.
(c)
Notification of changes to tax base. -- The tax
commissioner shall make reasonable efforts to notify sellers of
legislative changes to the tax base and to amendments to sales and
use tax rules, as that term is defined in section two, article one,
chapter twenty-nine-a of this code.
(d)
Liability of seller.
(1) Failure of a seller to receive notice or failure of the
state to provide notice of a rate change or a change in the tax
base, or to limit the effective date of a rate change, does not
relieve the seller of its obligation to collect sales or use taxes
for this state.
(2) Failure of the Tax Commissioner to
provide for at least
thirty days between the enactment of the statute providing for a
rate change and the effective date of such rate change shall relieve the seller of liability for failing to collect tax at the
new rate if:
(A) The seller collected tax at the immediately preceding
effective rate; and
(B) The seller's failure to collect at the newly effective
rate does not extend beyond thirty days after the date of the
enactment of the new rate.
(e) Notwithstanding subdivision (d)(2), if the seller
fraudulently failed to collect at the new rate or solicits
purchasers based on the immediately preceding effective rate this
relief does not apply.
§11-15B-24. Administration of exemptions.
(a)
General rules. -- When a purchaser claims an exemption
from paying tax under article fifteen or fifteen-a of this chapter:
(1) Sellers shall obtain identifying information of the
purchaser and the reason for claiming a tax exemption at the time
of the purchase, as determined by the governing board.
(2) A purchaser is not required to provide a signature to
claim an exemption from tax unless a paper exemption certificate is
used.
(3) The seller shall use the standard form for claiming an
exemption electronically that is adopted by the governing board.
(4) The seller shall obtain the same information for proof of
a claimed exemption regardless of the medium in which the
transaction occurred.
(5) The Tax Commissioner may utilize a system wherein the purchaser exempt from the payment of the tax is issued an
identification number that is presented to the seller at the time
of the sale.
(6) The seller shall maintain proper records of exempt
transactions and provide the records to the Tax Commissioner or the
Tax Commissioner's designee.
(7) The Tax Commissioner shall administer use-based and
entity-based exemptions when practicable through a direct pay
permit, an exemption certificate or another means that does not
burden sellers.
(8) After December 31, 2007, in the case of drop shipments, a
third-party vendor such as a drop shipper may claim a resale
exemption based on an exemption certificate provided by its
customer/reseller or any other acceptable information available to
the third-party vendor evidencing qualification for a resale
exemption, regardless of whether the customer/reseller is
registered to collect and remit sales and use taxes in this state,
when the sale is sourced to this state.
(b) The Tax Commissioner shall relieve sellers that follow the
requirements of this section from the tax otherwise applicable if
it is determined that the purchaser improperly claimed an exemption
and shall hold the purchaser liable for the nonpayment of tax.
This relief from liability does not apply:
(A) To a seller who fraudulently fails to collect the tax;
(B) To a seller who solicits purchasers to participate in the
unlawful claim of an exemption;
(C) To a seller who accepts an exemption certificate when the
purchaser claims an entity-based exemption when: (i) The subject of
the transaction sought to be covered by the exemption certificate
is actually received by the purchaser at a location operated by the
seller; and (ii) the state in which that location resides provides
an exemption certificate that clearly and affirmatively indicates
(graying out exemption reason types on uniform form and posting it
on a state's website is an indicator) that the claimed exemption is
not available in that state.
(c)
Time within which seller must obtain exemption
certificates. -- A seller is relieved from paying tax otherwise
applicable under article fifteen or fifteen-a of this chapter if
the seller obtains a fully completed exemption certificate or
captures the required data elements within ninety days subsequent
to the date of sale.
(1) If the seller has not obtained an exemption certificate or
all required data elements, the seller may, within one hundred
twenty days subsequent to a request for substantiation by the Tax
Commissioner, either prove that the transaction was not subject to
tax by other means or obtain a fully completed exemption
certificate from the purchaser, taken in good faith. For purposes
of this section, the Tax Commissioner may continue to apply this
State's standards of good faith until a uniform standard for good
faith is defined in the Streamlined Sales and Use Tax Agreement.
(2) Nothing in this section shall affect the ability of the
Tax Commissioner to require purchasers to update exemption certificate information or to reapply with the state to claim
certain exemptions.
(3) Notwithstanding the preceding provisions of this section,
when an exemption may be claimed by exemption certificate, a seller
is relieved from paying the tax otherwise applicable if the seller
obtains a blanket exemption certificate from a purchaser with which
the seller has a recurring business relationship. The Tax
Commissioner may not request from the seller renewal of blanket
certificates or updates of exemption certificate information or
data elements when there is a recurring business relationship
between the buyer and seller. For purposes of this subdivision, a
recurring business relationship exists when a period of no more
than twelve months elapses between sales transactions.
(d)
Exception. -- No exemption certificate or direct pay
permit number is required when the sale is exempt per se from the
taxes imposed by articles fifteen and fifteen-a of this chapter.
§11-15B-28. Confidentiality and privacy protections under
Model I.
(a)
Purpose. -- The purpose of this section is to set forth
the policy of this State for the protection of the confidentiality
rights of all participants in the streamlined sales and use tax
administration and collection system and of the privacy interests
of consumers who deal with Model I sellers.
(b)
Certain terms defined. -- As used in this section:
(1) The term "confidential taxpayer information" means all information that is protected under section five-d, article ten of
this chapter;
(2) The term "personally identifiable information" means
information that identifies a person; and
(3) The term "anonymous data" means information that does not
identify a person.
(c)
Certified service providers. -- With very limited
exceptions, a certified service provider shall perform its tax
calculation, remittance and reporting functions without retaining
the personally identifiable information of consumers.
(d)
Certification of service providers. -- The governing board
may certify a service provider only if that certified service
provider certifies that:
(1) Its system has been designed and tested to ensure that the
fundamental precept of anonymity is respected;
(2) That personally identifiable information is only used and
retained to the extent necessary for the administration of Model I
with respect to exempt purchasers and proper identification of
taxing jurisdictions;
(3) It provides consumers clear and conspicuous notice of its
information practices, including what information it collects, how
it collects the information, how it uses the information, how long,
if at all, it retains the information and whether it discloses the
information to member states. This notice is satisfied by a
written privacy policy statement accessible by the public on the
official website of the certified service provider;
(4) Its collection, use and retention of personally
identifiable information is limited to that required by the states
that are members of the Streamlined Sales and Use Tax Agreement to
ensure the validity of exemptions from taxation that are claimed by
reason of a consumer's status or the intended use of the goods or
services purchased and for documentation of the correct assignment
of taxing jurisdictions; and
(5) It provides adequate technical, physical and
administrative safeguards as to protect personally identifiable
information from unauthorized access and disclosure.
(e)
State notification of privacy policy. -- The Tax
Commissioner shall provide public notification to consumers,
including their exempt purchasers, of this state's practices
relating to the collection, use and retention of personally
identifiable information.
(f)
Destruction of confidential information. -- When any
personally identifiable information that has been collected and
retained by the Tax Commissioner is no longer required for the
purposes set forth in subdivision (4), subsection (d) of this
section, the information shall no longer be retained by the Tax
Commissioner.
(g)
Review and correction by individuals. -- When personally
identifiable information regarding an individual is retained by or
on behalf of the Tax Commissioner, the commissioner shall provide
reasonable access by an individual to his or her own information in
the commissioner's possession and a right to correct any inaccurately recorded information.
(h)
Discovery by other persons. -- If anyone other than the
individual, or a person authorized in writing by the individual, or
by controlling law seeks to discover personally identifiable
information, the Tax Commissioner shall make a reasonable and
timely effort to notify the individual of the request.
(i)
Enforcement. -- This privacy policy shall be enforced by
the Tax Commissioner or the Attorney General of this State.
(j) This section shall not be interpreted as limiting or
abrogating any other statutory or regulatory provision of this
State regarding the collection, use and maintenance of confidential
taxpayer information, which provisions remain fully applicable and
binding. This section and the Streamlined Sales and Use Tax
Agreement do not enlarge or limit the authority of this State to:
(1) Conduct audits or other reviews as provided under the
Streamlined Sales and Use Tax Agreement and state law;
(2) Provide records pursuant to the Freedom of Information
Act, disclosure laws with governmental agencies or other laws or
regulations;
(3) Prevent, consistent with state law, disclosures of
confidential taxpayer information;
(4) Prevent, consistent with federal law, disclosures or
misuse of federal return information obtained under a disclosure
agreement with the Internal Revenue Service; or
(5) Collect, disclose, disseminate or otherwise use anonymous
data for governmental purposes.
(k)
Service provider's confidentiality policy may be more
restrictive. -- This privacy policy does not preclude the governing
board from certifying a certified service provider whose privacy
policy is more protective of confidential taxpayer information or
personally identifiable information than is required by the
agreement or the laws of this state.
§11-15B-32. Effective date.
(a) The provisions of this article, as amended or added during
the regular legislative session in the year 2003, shall take effect
the January 1, 2004, and apply to all sales made on or after that
date and to all returns and payments due on or after that day,
except as otherwise expressly provided in section five of this
article.
(b) The provisions of this article, as amended or added during
the second extraordinary legislative session in the year 2003,
shall take effect January 1, 2004, and apply to all sales made on
or after that date.
(c) The provisions of this article, as amended or added by Act
of the Legislature in the year 2004, shall apply to all sales made
on or after the date of passage in the year 2004.
(d) The provisions of this article, as amended or added
during the regular legislative session in the year 2008, shall
apply to all sales made on or after the date of passage and to all
returns and payments due on or after that day, except as otherwise
expressly provided in this article.
(e) The provisions of this article, as amended or added during the regular legislative session in the year 2009, shall
apply to all sales made on or after the date of passage and to all
returns and payments due on or after that day, except as otherwise
expressly provided in this article.