FISCAL NOTE
Date Requested: February 18, 2021
Time Requested: 03:20 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1042 |
Introduced |
SB34 |
|
|---|
| CBD Subject: |
|
|---|
|
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 create an exemption in the state sales and use tax for the rental or leasing of equipment among commonly owned companies.
According to our interpretation, the proposed legislation would add a Consumer Sales and Use Tax exemption for the rental or leasing of heavy equipment or machinery among corporations with at least 50 percent common ownership. The legislation would expand on similar exemptions for services performed by one corporation for an entity with at least 50 percent common ownership, contracting services, and direct use. The bill has no stated effective date; therefore, the subdivision would become effective 90 days after passage. Based on our interpretation, the proposed legislation would have a minimal impact on General Revenue Fund collections.
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 |
5,000 |
0 |
| 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):
According to our interpretation, the proposed legislation would add a Consumer Sales and Use Tax exemption for the rental or leasing of heavy equipment or machinery among corporations with at least 50 percent common ownership. The legislation would expand on similar exemptions for services performed by one corporation for an entity with at least 50 percent common ownership, contracting services, and direct use. The bill has no stated effective date; therefore, the subdivision would become effective 90 days after passage. Based on our interpretation, the proposed legislation would have a minimal impact on General Revenue Fund collections.
Additional administrative costs incurred by the Tax Department would be $5,000 in FY2022.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov