ENROLLED
COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 345
(By Senators Tomblin (Mr. President) and Caruth,
By Request of the Executive)
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[Passed March 9, 2010; in effect ninety days from passage.]
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AN ACT to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §11-13B-19, relating
to requiring a study of the telecommunications tax;
authorizing the Tax Commissioner to order the disclosure of
certain information; exempting certain information received by
the Tax Commissioner from the West Virginia Freedom of
Information Act; prohibiting the disclosure of certain
information received by the Tax Commissioner; providing for
criminal and civil penalties; defining terms; and authorizing
the Tax Commissioner to promulgate rules and emergency rules.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §11-13B-19, to read as
follows:
ARTICLE 13B. TELECOMMUNICATIONS TAX.
§11-13B-19. Tax Commissioner study of telecommunications tax.
(a)
Findings and purpose. -- The Legislature finds that the
tax imposed by this article fails to account for modern business
models, operational structures, technologies and fundamental
economics of the business of telecommunications. The Legislature
further finds that the tax imposed under this article should be
amended to provide for a reasonable, fair and efficient tax that
inures to the benefit and general welfare of West Virginia.
Therefore, it is the purpose of this section to require a study of
telecommunications services relative to the imposition of a
telecommunications tax, to provide the Tax Commissioner with
plenary authority to order the disclosure of financial information
and other data necessary to undertake the study and to provide for
the confidentiality of financial information and other data
disclosed as part of the study.
(b)
Telecommunications tax study. -- The Tax Commissioner
shall study the business of telecommunications service and related
businesses and shall file a report with the Governor and the
Legislature on or before July 1, 2011. The report shall recommend
amendments to the tax imposed under this article or any other tax
pertaining to telecommunications service and shall include
recommended legislation. The Tax Commissioner in his report shall
examine the feasibility and fiscal implications on affected governmental entities or political subdivisions of a single uniform
statewide telecommunications service tax or, alternatively,
imposition of the sales and use tax on the retail sale of
telecommunications services as a replacement for, or in addition
to, other taxes and fees on telecommunications service. The Tax
Commissioner may include this study as part of the findings and
recommendations of the Governor's Tax Modernization Project and may
cooperate with persons engaged in the Governor's Tax Modernization
Project to further the purposes of this study. Any consultant
under contract with the Tax Commissioner who assists in conducting
this study is "an agent of this state" for the purposes of section
five-d, article ten of this chapter and is subject to the
requirements of that section and subsection (e) of this section:
Provided, That witnesses, experts, government officials,
consultants and industry representatives who provide data,
information or statistics to the Tax Commissioner or others engaged
in the study mandated by this section shall not be treated as being
subject to the confidentiality restrictions of section five-d,
article ten of this chapter and shall not be treated as subject to
the confidentiality requirements of subsection (e) of this section,
solely by reason of having provided information to the study. For
purposes of this study, the Tax Commissioner may seek and examine
the information, data, records and testimony of: Experts in the
fields of law, economics and taxation; representatives of state, county, local and municipal governmental subdivisions of this state
and other states of the United States; persons and entities engaged
in telecommunications services businesses; persons knowledgeable
about the telecommunications industry, taxation of the
telecommunications industry and the economics of the
telecommunications industry; and any other person or entity that
may have information relevant to the study mandated by this
section.
(c)
Definitions. -- As used in this section:
(1) "Person" means any individual, firm, partnership, limited
partnership, company, copartnership, joint venture, association,
corporation, organization or entity, whether private or public.
(2) "Telecommunications service" when used in this article
shall have the same meaning as that term is defined in the
Streamlined Sales and Use Tax Administration Act in article
fifteen-b of this chapter.
(d)
Disclosure of financial information and other data. --
(1) Notwithstanding any provision of this code to the
contrary, the Tax Commissioner may, for the purpose of conducting
the study required by this section, order the disclosure of
financial information and other data in the possession of any
person or entity that may have information relevant to the study
mandated by this section, including, but not limited to, government
entities and persons or entities engaged in a telecommunications service business in this state or a related business. The
disclosures shall be on forms prescribed by the Tax Commissioner
and shall be completed and filed pursuant to instructions provided
by the Tax Commissioner.
(2) Any person failing to comply with an order of disclosure
within ninety days of receipt of the initial written order of
disclosure, which order may be in the form of a letter or other
written order, or in the form of a subpoena or subpoena duces
tecum, shall be subject to a penalty, collectible as provided in
article ten of this chapter. The amount of the penalties shall be
an initial penalty of $25,000 which shall be imposed upon the
passage of the first ninety days subsequent to receipt of such
written order of disclosure during which the failure to comply
occurs and an additional penalty of $1,000 per day for each day
after the first ninety days during which the failure to comply
continues. The count of days for purposes of this penalty shall
not cease by reason of the completion of the study or by reason of
the completion and issuance of the study report, but shall continue
in perpetuity until such time as the information which was the
subject of the order is disclosed in full to the Tax Commissioner
or until the Tax Commissioner issues a written order for cessation
of the count of Days. The Tax Commissioner may issue a written
order for cessation of the count of days, for purposes of this
penalty, no earlier than the date on which the study report mandated by this section has been completed and issued by the Tax
Commissioner. In the case of information which has been the
subject of a subpoena or subpoena duces tecum, the $25,000 initial
penalty and the $1,000 per day penalty imposed by this section
shall be in addition to all applicable civil and criminal penalties
lawfully imposed for failure to comply with a subpoena or subpoena
duces tecum. The Tax Commissioner may waive all or any part of
such penalty for good cause shown.
(3) The Tax Commissioner, or his or her designee, may issue
subpoenas and subpoenas duces tecum, in the manner prescribed in
and subject to the requirements of section five-b, article ten of
this chapter, to enforce the disclosure requirements of this
section. Failure to comply with any such subpoena or subpoena
duces tecum shall be subject to all applicable civil and criminal
penalties lawfully imposed for failure to comply with a subpoena or
subpoena duces tecum.
(e)
Confidentiality. --
(1) Financial information and other data disclosed to the Tax
Commissioner under the provisions of this section shall be
considered confidential and exempt from article one, chapter
twenty-nine-b of this code.
(2) Any information disclosed to the Tax Commissioner pursuant
to the requirements of this section shall have all of the
confidentiality protections given to a "return" under section five-d of article ten of this Chapter and any disclosure not authorized
by that section, or this section, shall be subject to all of the
penalties provided for unlawful disclosure of a "return".
Notwithstanding any provision of this code to the contrary, the Tax
Commissioner may share financial information and other data
disclosed under this section with any consultant under contract
with the Tax Commissioner to assist in conducting the study. It is
unlawful for the Tax Commissioner or any person conducting the
study, including any consultant under contract with the Tax
Commissioner to assist in conducting the study, to disclose to any
person not conducting the study any financial information or other
data disclosed under this section. Such disclosure shall be a
violation of the tax information confidentiality provisions of
section five-d, article ten of this chapter.
(3) Nothing in this section may be construed as prohibiting
the publication or release of statistics so classified as to
prevent the identification of a particular person or entity.
(f)
Rules authorized. -- The Tax Commissioner may promulgate
rules, including emergency rules, to implement the provisions of
this section. For the purposes of article three, chapter twenty-
nine-a of this code, a sufficient emergency exists to justify the
promulgation of the emergency rules.
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