FISCAL NOTE
Date Requested: January 14, 2023
Time Requested: 03:23 PM |
| Agency: |
Motor Vehicles, WV Division of |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1805 |
Introduced |
HB2511 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
ROAD FUND
Sources of Revenue:
Special Fund
Legislation creates:
Decreases Existing Revenue, Creates New Expense
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to make the collection and payment by the seller of sales tax on seller-financed sales of motor vehicles to be completed as the seller receives the proceeds of the sale from the buyer equal to the applicable percent sales tax of the amount of the monthly payment, applied to each payment, and continuing for the entire term of the loan period.
To operate this program the Division will need two Accounting Technicians to maintain the accounts receivable program, and three Accountant/Auditors stationed around the state to ensure the accuracy of the data being reported. The Division will also need to add an attorney and paralegal for the purpose of pursuing collection of defaulted tax payments. Total annual salary and benefits for these six positions is $501,420.
The Division can not represent itself in court and therefore would need to pay for an attorney through the Attorney General’s office to fill this role. All the employees will need to be equipped with appropriate equipment required to perform their duties. The list of items needed include various computer equipment and vehicles for the individuals who will be traveling. Total first year current expense is projected to be $234,538. Those current expenses continuing from year to year will total $92,056 per year.
The Division estimates that there are currently $32,712,480 in seller financed car sales each year producing $1,962,749 ($32,712,480 X 6%) in tax revenue. The Division projects that 40% of this total will be uncollectible for an annual reduction of revenue of $785,100($1,962,749 X 40%)
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2023
Increase/Decrease
(use"-") |
2024
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
735,958 |
593,476 |
| Personal Services |
0 |
501,420 |
501,420 |
| Current Expenses |
0 |
234,538 |
92,056 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
-785,100 |
-785,100 |
Explanation of above estimates (including long-range effect):
FY 2024
PERSONNEL COSTS - FY 2024
$78,000 Accounting Tech
$162,000 Accountant/Auditor
$83,000 Attorney
$43,000 Paralegal
$366,000 Total Salaries
$135,420 Benefits
$501,420 Total Salary and Benefits
CURRENT EXPENSES - FY 2024
$89,000 Attorney General
$2,496 Cell service
$560 Office supplies/person
$5,829 Vehicle Fuel
$6,441 Vehicle Maintenance
$120,000 Vehicles
$4,236 Laptop
$2,148 scanner
$868 Printer
$320 Cell phone equip.
$2,640 Desktop computer
$234,538 Total Current Expense
UPON FULL IMPLEMENTATION
PERSONNEL COSTS - UPON FULL IMPLEMENTATION
$78,000 Accounting Tech
$162,000 Accountant/Auditor
$83,000 Attorney
$43,000 Paralegal
$366,000 Total Salaries
$135,420 Benefits
$501,420 Total Salary and Benefits
CURRENT EXPENSES - UPON FULL IMPLEMENTATION
$89,000 Attorney General
$2,496 Cell service
$560 Office supplies/person
$5,829 Vehicle Fuel
$6,441 Vehicle Maintenance
$92,056 Current Expense
ESTIMATED REVENUE REDUCTION
5,452 Projected Seller Financed Deals
$6,000 Estimated Average Sales Value
$32,712,480 Estimated total Sales value
6.00% Tax Rate
$1,962,749 Total Tax
40.00% Estimated Loss Rate
$785,100 Estimated Revenue Reduction
Memorandum
Please identify any areas of vagueness, technical defects, reasons a bill would not have a fiscal impact, and/or any special issues not captured elsewhere on this form.
Person submitting Fiscal Note: Raeann Kriner
Email Address: raeann.k.kriner@wv.gov