FISCAL NOTE
Date Requested: January 28, 2019
Time Requested: 11:21 AM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2231 |
Introduced |
HB2515 |
|
|---|
| 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 stated purpose of this bill is to exempt the sale and installation of mobility enhancing equipment and the sale and installation of repair or replacement parts of mobility enhancing equipment from the sales and use tax and to establish the definition of mobility enhancing equipment in this section.
Based on our interpretation, the proposed legislation would make the sale or installation of “mobile enhancing devices” installed in new or used vehicles for use by persons with physical disabilities exempt from sales or use tax by adding a new subsection. In doing so, it omits the requirement for a prescription by a health care provider to make the sales tax exempt. The bill likewise exempts repair services and parts used in repair or modification on mobility enhancing devise.
Due to the board nature of the bill, we are unable to accurately estimate the loss in sales tax revenue to the General Revenue Fund. The bill does not indicate what is classified as “mobile enhancing devices.” Nor does the bill define physical disability.
Additional administrative costs incurred by the State Tax Department are expected to be $1,000 for FY2020 and for each fiscal year thereafter.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2019
Increase/Decrease
(use"-") |
2020
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
1,000 |
1,000 |
| Personal Services |
0 |
1,000 |
1,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
Based on our interpretation, the proposed legislation would make the sale or installation of “mobile enhancing devices” installed in new or used vehicles for use by persons with physical disabilities exempt from sales or use tax by adding a new subsection. In doing so, it omits the requirement for a prescription by a health care provider to make the sales tax exempt. The bill likewise exempts repair services and parts used in repair or modification on mobility enhancing devise.
Due to the board nature of the bill, we are unable to accurately estimate the loss in sales tax revenue to the General Revenue Fund. The bill does not indicate what is classified as “mobile enhancing devices.” Nor does the bill define physical disability.
Additional administrative costs incurred by the State Tax Department are expected to be $1,000 for FY2020 and for each fiscal year thereafter.
Memorandum
The stated purpose of this bill is to exempt the sale and installation of mobility enhancing equipment and the sale and installation of repair or replacement parts of mobility enhancing equipment from the sales and use tax and to establish the definition of mobility enhancing equipment in this section.
There may be a title defect in that the title does not mention installation into vehicles or that no prescription is required, which seem to be a primary thrust of the new subsection ( c).
The definition of “mobility enhancing device” is cross-referenced to §11-15B-2(b)(32). “Physical disability” is not defined and may lead to difficulties in administration.
It should be noted that some mobile enhancing devices maybe already exempted from Consumers Sales Tax if it is classified as durable medical device that was obtained by a prescription provided by a health care provider.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov