ENROLLED
Senate Bill No. 463
(By Senator Craigo)
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[Passed April 10, 1993; in effect ninety days from passage.]
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AN ACT to amend and reenact section eight, article one, chapter
five-e of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; to amend and reenact section
two, article nine, chapter eleven of said code; to further
amend said article by adding thereto a new section,
designated section two-a; to amend and reenact section
three, article twelve-b of said chapter; to amend and
reenact section two, article thirteen-a of said chapter; to
amend and reenact section five, article thirteen-c of said
chapter; to further amend said article by adding thereto a
new section, designated section fifteen; to amend article
thirteen-d of said chapter by adding thereto a new section,
designated section three-e; to amend and reenact sections
two and nine, article fifteen of said chapter; to amend and
reenact section twelve, article twenty-one of said chapter;
to further amend said article by adding thereto a new
section, designated section seventy-seven; to amend and
reenact section nine, article twenty-three of said chapter;
to amend and reenact sections six and thirteen, article
twenty-four of said chapter; to amend article nine-a,
chapter sixteen of said code by adding thereto a new
section, designated section six; to amend and reenact
sections four, five, six, six-a, twelve, fifteen, sixteen
and twenty-four, article twenty, chapter forty-seven of said
code; to further amend said article by adding thereto two
new sections, designated sections twelve-a and
twenty-eight-a; to amend and reenact sections seven, fifteen
and twenty-two, article twenty-one of said chapter; and to
further amend said chapter by adding thereto a new article,
designated article twenty-three, all relating to revenue
enhancements; providing expanded application of the crimes
and penalties provisions relating to taxation; creating a
criminal investigation section within the department of tax
and revenue; providing for a reduction in the amount of
authorized credits under the West Virginia capital company
act; by increasing the alternative minimum severance tax on
coal by twenty-five cents; reduction in gross value for
amount of federal energy tax; reducing the amount of super
credit that may be taken in remaining years by adding three
years to the remaining period; prohibiting the use of
credits against sales and use tax liability; providing a
one-year suspension of the business investment and jobs
expansion tax credit, also known as the super credit;
requiring the commission to prepare a report recommending a
replacement credit to the Legislature; eliminating the salestax exemption for contractor engaging in repaving, repair or
maintenance of bridges or highways; eliminating the indirect
use sales tax exemption; providing definitions of directly
used and consumed; subjecting lottery winnings to personal
income tax; subjecting lottery winnings of a certain amount
to withholding; extending the due date of business franchise
and corporate net income tax returns filed by certain tax
exempt organizations; prohibiting any net operating loss
from being carried back to any previous taxable year;
requiring the amount of depreciation, amortization or cost
depletion to be added back into the amount of taxable income
for persons asserting specified credits; providing an age
limitation on persons permitted to play bingo; changing the
fee of super bingo license; limiting the payment of
compensation to persons conducting bingo occasions;
increasing the percentage of proceeds used for expenses;
requiring specified records and reports; requiring bingo
operators to designate nonsmoking sections; changing the
license fee for charitable raffles; allowing payment of
certain expenses; requiring the filing of reports for
charitable raffles; imposing a license fee on charitable
raffle boards and games; requiring stamp to be affixed to
charitable raffle boards and games; requiring wholesaler to
pay fee; providing criminal penalties for failure to file a
return; allowing forfeitures of vehicles and vessels upon
illegal transportation of charitable raffle boards and
games; authorizing promulgation of legislative rules;providing a severability clause; and providing for general
procedure and administration.
Be it enacted by the Legislature of West Virginia:
That section eight, article one, chapter five-e of the code
of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted; that section two, article
nine, chapter eleven of said code be amended and reenacted; that
said article be further amended by adding thereto a new section,
designated section two-a; that section three, article twelve-b of
said chapter be amended and reenacted; that section two, article
thirteen-a of said chapter be amended and reenacted; that section
five, article thirteen-c of said chapter be amended and
reenacted; that said article be further amended by adding thereto
a new section, designated section fifteen; that article
thirteen-d of said chapter be amended by adding thereto a new
section, designated section three-e; that sections two and nine,
article fifteen of said chapter be amended and reenacted; that
section twelve, article twenty-one of said chapter be amended and
reenacted; that said article be further amended by adding thereto
a new section, designated section seventy-seven; that section
nine, article twenty-three of said chapter be amended and
reenacted; that sections six and thirteen, article twenty-four of
said chapter be amended and reenacted; that article nine-a,
chapter sixteen of said code be amended by adding thereto a new
section, designated section six; that sections four, five, six,
six-a, twelve, fifteen, sixteen and twenty-four, article twenty,
chapter forty-seven of said code be amended and reenacted; thatsaid article be further amended by adding thereto two new
sections, designated sections twelve-a and twenty-eight-a; that
sections seven, fifteen and twenty-two, article twenty-one of
said chapter be amended and reenacted; and that said chapter be
further amended by adding thereto a new article, designated
article twenty-three, all to read as follows:
CHAPTER 5E. VENTURE CAPITAL COMPANY.
ARTICLE 1. WEST VIRGINIA CAPITAL COMPANY ACT.
§5E-1-8. Tax credits.
(a) The total amount of tax credits authorized for a single
qualified company may not exceed two million dollars.
Capitalization of the company may be increased pursuant to rule
of the authority.
(b) The total credits authorized by the authority for all
companies may not exceed a total of ten million dollars each
fiscal year:
Provided, That for the fiscal year beginning the
first day of July, one thousand nine hundred ninety-two, the
total credits authorized by the authority for all companies under
this section or this article may not exceed a total of eight
million dollars each fiscal year:
Provided, however, That for
the fiscal year beginning on the first day of July, one thousand
nine hundred ninety-three, and the fiscal year one thousand nine
hundred ninety-four, the total credits authorized for all
companies under this article may not exceed a total of five
million dollars:
Provided further, That for the fiscal year
beginning the first day of July, one thousand nine hundred
ninety-three, and for each fiscal year thereafter, the authorityshall, for the first one hundred eighty days of the fiscal year,
accept applications only from companies who certify in their
application that the investment of its entire capital base will
be in one or more small business investment corporations
organized under the small business investment act:
And provided
further, That the capital base of any such qualified company
shall be invested in accordance with the provisions of this
article. The authority shall allocate these credits to qualified
companies in the order that said companies are qualified.
(c) Any investor, including an individual, partnership or
corporation who makes a capital investment in a qualified West
Virginia capital company, is entitled to a tax credit equal to
fifty percent of the investment, except as otherwise provided in
this section or in this article. The credit allowed by this
article shall be taken after all other credits allowed by chapter
eleven of this code. It shall be taken against the same taxes
and in the same order as set forth in subsections (c) through
(i), section five, article thirteen-c of said chapter. The
credit for investments by a partnership or by a corporation
electing to be treated as a Subchapter S corporation may be
divided pursuant to election of partners or shareholders.
(d) The tax credit allowed under this section is to be
credited against the taxpayer's tax liability for the taxable
year in which the investment in a qualified West Virginia capital
company is made. If the amount of the tax credit exceeds the
taxpayer's tax liability for the taxable year, the amount of the
credit which exceeds the tax liability for the taxable year maybe carried to succeeding taxable years until used in full, or
until forfeited:
Provided, That: (i) Tax credits may not be
carried forward beyond fifteen years; and (ii) tax credits may
not be carried back to prior taxable years. Any tax credit
remaining after the fifteenth taxable year is forfeited.
(e) The tax credit provided for in this section is available
only to those taxpayers whose investment in a qualified West
Virginia capital company occurs after the first day of July, one
thousand nine hundred eighty-six.
(f) The tax credit allowed under this section may not be
used against any liability the taxpayer may have for interest,
penalties or additions to tax.
(g) Notwithstanding any provision in this code to the
contrary, the tax commissioner shall publish in the state
register the name and address of every taxpayer, and the amount,
by category, of any credit asserted under this article for any
tax year beginning on or after the first day of January, one
thousand nine hundred ninety-one. The categories by dollar
amount of credit received shall be as follows:
(1) More than $1.00, but not more than $50,000;
(2) More than $50,000, but not more than $100,000;
(3) More than $100,000, but not more than $250,000;
(4) More than $250,000, but not more than $500,000;
(5) More than $500,000, but not more than $1,000,000;
(6) More than $1,000,000.
CHAPTER 11. TAXATION.
ARTICLE 9. CRIMES AND PENALTIES.
§11-9-2. Application of this article.
(a) The provisions of this article shall apply to the
following taxes imposed by this chapter: (1) The inheritance and
transfer taxes and estate taxes imposed by article eleven of this
chapter; (2) the business franchise registration tax imposed by
article twelve of this chapter; (3) the annual tax on incomes of
certain carriers imposed by article twelve-a of this chapter; (4)
the business and occupation tax imposed by article thirteen of
this chapter; (5) the gasoline and special fuels excise tax
imposed by article fourteen of this chapter; (6) the motor
carrier road tax imposed by article fourteen-a of this chapter;
(7) the consumers sales and service tax imposed by article
fifteen of this chapter; (8) the use tax imposed by article
fifteen-a of this chapter; (9) the cigarette tax imposed by
article seventeen of this chapter; (10) the soft drinks tax
imposed by article nineteen of this chapter; (11) the personal
income tax imposed by article twenty-one of this chapter; and
(12) the corporation net income tax imposed by article twenty-
four of this chapter.
(b) The provisions of this article shall also apply to the
West Virginia tax procedure and administration act in article ten
of this chapter, and to any other articles of this chapter when
such application is expressly provided for by the Legislature.
(c) The provisions of this article shall also apply to the
charitable bingo fee imposed by sections six and six-a, article
twenty, chapter forty-seven of this code; the charitable raffle
fee imposed by section seven, article twenty-one of said chapter;and the charitable raffle boards and games fees imposed by
section three, article twenty-three of said chapter.
(d) Each and every provision of this article shall apply to
the articles of this chapter listed in subsections (a), (b) and
(c) of this section, with like effect, as if the provisions of
this article were applicable only to such tax and were set forth
in extenso in such article.
§11-9-2a. Criminal investigation section established; funding
of same.
A criminal investigation section consisting of no more than
ten investigators plus necessary support staff is hereby
established within the state tax division for the purpose of
assuring compliance with laws, rules and regulations pertaining
to the taxes or credits established by articles eleven, eleven-a,
eleven-b, twelve, twelve-a, twelve-b, thirteen, thirteen-a,
thirteen-b, thirteen-c, thirteen-d, thirteen-e, thirteen-f,
thirteen-g, thirteen-h, fourteen, fourteen-a, fifteen, fifteen-a,
sixteen, seventeen, eighteen, nineteen, twenty-three, twenty-four
and twenty-six of this chapter, and articles twenty, twenty-one
and twenty-three, chapter forty-seven of this code. Charitable
bingo fees imposed under sections six and six-a, article twenty
of said chapter; charitable raffle fees imposed under section
seven, article twenty-one of said chapter; and charitable raffle
boards and games fees imposed under section three, article
twenty-three of said chapter shall be deposited in a special
revenue account established in the office of the treasurer and
shall be used to support compliance expenditures relating to theestablishment, maintenance and support of such criminal
investigation section. At the close of the fiscal year, any
moneys in the special revenue account in excess of twenty
thousand dollars shall be transferred to the general revenue
fund.
Any employee of the criminal investigation section so
designated by the tax commissioner who shall have a background in
accounting and who shall be certified as a law-enforcement
officer pursuant to article twenty-nine, chapter thirty of this
code, or its equivalent, shall have all the lawful powers
delegated to members of the department of public safety except
the power to carry firearms to enforce the provisions of this
article in any county or municipality of this state. The
commissioner shall establish such additional standards as he or
she deems applicable or necessary. Any such employee shall,
before entering upon the discharge of his or her duties, execute
a bond with security in the sum of three thousand five hundred
dollars, payable to the state of West Virginia, conditioned for
the faithful performance of his or her duties, as such, and such
bond shall be approved as to form by the attorney general, and
the same shall be filed with the secretary of state and preserved
in his or her office. The department of public safety, any
county sheriff, or deputy sheriff, or any municipal police
officer, upon request by the tax commissioner, is hereby
authorized to assist the tax commissioner in enforcing the
provisions of this article and the criminal penalty provisions of
this article or any article of this chapter administered underthis article.
ARTICLE 12B. MINIMUM SEVERANCE TAX ON COAL.
§11-12B-3. Imposition of tax, credit.
(a)
Imposition of tax. -- Upon every person exercising the
privilege of engaging within this state in severing, extracting,
reducing to possession or producing coal for sale, profit or
commercial use there is hereby imposed an annual minimum
severance tax equal to fifty cents per ton of coal produced by
the taxpayer for sale, profit or commercial use during the
taxable year:
Provided, That for taxable years ending after the
thirty-first day of May, one thousand nine hundred ninety-three,
the minimum severance tax imposed on coal produced by the
taxpayer for sale, profit or commercial use for such taxable year
shall be seventy-five cents, with such rate increase to apply
only to tons of coal produced after the thirty-first day of May,
one thousand nine hundred ninety-three.
(b)
Credit against article thirteen-a tax. -- A person who
pays the minimum severance tax imposed by this article shall be
allowed a credit against the severance tax imposed on coal by
section three, article thirteen-a of this chapter, but not
including the additional severance tax on coal imposed by section
six of said article, equal to the liability of the taxpayer for
the taxable year for payment of the minimum severance tax on coal
imposed by this article:
Provided, That the amount of credit
allowed by this section shall not exceed the severance tax
liability of the taxpayer for the taxable year determined under
paragraph (1), subsection (b), section three of said articleexclusive of the additional tax on coal imposed by section six of
said article after application of all credits to which the
taxpayer may be entitled except any credit allowed pursuant to
chapter five-e of this code any credit for installment payments
of estimated tax paid pursuant to section six of this article
during the tax year and any credit for overpayment of article
thirteen-a tax. Notwithstanding anything herein to the contrary,
in no event shall the credit allowed under chapter five-e of this
code be allowed as a credit against the minimum severance tax
imposed by this article.
ARTICLE 13A. SEVERANCE TAXES.
§11-13A-2. Definitions.
(a)
General. -- When used in this article, or in the
administration of this article, the terms defined in subsection
(b) of this section shall have the meanings ascribed to them by
this section, unless a different meaning is clearly required by
either the context in which the term is used or by specific
definition.
(b)
Terms defined. --
(1) "Coal" means and includes any material composed
predominantly of hydrocarbons in a solid state.
(2) "Delegate" in the phrase "or his or her delegate", when
used in reference to the tax commissioner, means any officer or
employee of the state tax department duly authorized by the tax
commissioner directly, or indirectly by one or more redelegations
of authority, to perform the function mentioned or described in
this article or regulations promulgated thereunder.
(3) "Economic interest" for the purpose of this article is
synonymous with the economic interest ownership required by
Section 611 of the Internal Revenue Code in effect on the thirty-
first day of December, one thousand nine hundred eighty-five,
entitling the taxpayer to a depletion deduction for income tax
purposes:
Provided, That a person who only receives an arm's
length royalty shall not be considered as having an economic
interest.
(4) "Extraction of ores or minerals from the ground"
includes extraction by mine owners or operators of ores or
minerals from the waste or residue of prior mining.
(5) "Fiduciary" means and includes, a guardian, trustee,
executor, administrator, receiver, conservator or any person
acting in any fiduciary capacity for any person.
(6) "Gross value" in the case of natural resources means the
market value of the natural resource product, in the immediate
vicinity, where severed, determined after application of post
production processing generally applied by the industry to obtain
commercially marketable or usable natural resource products. For
all natural resources, "gross value" is to be reported as
follows:
(A) For natural resources severed or processed (or both
severed and processed) and sold during a reporting period, gross
value is the amount received or receivable by the taxpayer.
(B) In a transaction involving related parties, gross value
shall not be less than the fair market value for natural
resources of similar grade and quality.
(C) In the absence of a sale, gross value shall be the fair
market value for natural resources of similar grade and quality.
(D) If severed natural resources are purchased for the
purpose of processing and resale, the gross value is the amount
received or receivable during the reporting period reduced by the
amount paid or payable to the taxpayer actually severing the
natural resource. If natural resources are severed outside the
state of West Virginia and brought into the state of West
Virginia by the taxpayer for the purpose of processing and
resale, the gross value is the amount received or receivable
during the reporting period reduced by the fair market value of
the natural resources of similar grade and quality and in the
same condition immediately preceding the processing of the
natural resources in this state.
(E) If severed natural resources are purchased for the
purpose of processing and consumption, the gross value is the
fair market value of processed natural resources of similar grade
and quality reduced by the amount paid or payable to the taxpayer
actually severing the natural resource. If severed natural
resources are severed outside the state of West Virginia and
brought into the state of West Virginia by the taxpayer for the
purpose of processing and consumption, the gross value is the
fair market value of processing natural resources of similar
grade and quality reduced by the fair market value of the natural
resources of similar grade and quality and in the same condition
immediately preceding the processing of the natural resources.
(F) In all instances, the gross value shall be reduced bythe amount of any federal energy tax imposed upon the taxpayer
after the first day of June, one thousand nine hundred
ninety-three, but shall not be reduced by any state or federal
taxes, royalties, sales commissions or any other expense.
(G) For natural gas, gross value is the value of the natural
gas at the wellhead immediately preceding transportation and
transmission.
(H) For limestone or sandstone quarried or mined, gross
value is the value of such stone immediately upon severance from
the earth.
(7) "Mining" includes not merely the extraction of ores or
minerals from the ground but also those treatment processes
considered as mining under this article and those treatment
processes necessary or incidental thereto.
(8) "Natural resource" means all forms of minerals
including, but not limited to, rock, stone, limestone, coal,
shale, gravel, sand, clay, natural gas, oil and natural gas
liquids which are contained in or on the soils or waters of this
state, and includes standing timber.
(9) "Partnership" includes a syndicate, group, pool, joint
venture or other unincorporated organization, through or by means
of which natural resources are severed, extracted, reduced to
possession and produced or prepared in this state for sale,
profit or commercial use. "Partner" includes a member of such a
syndicate, group, pool, joint venture or organization.
(10) "Person" or "company" is herein used interchangeably
and include any individual, firm, partnership, miningpartnership, joint venture, association, corporation, trust or
any other group or combination acting as a unit, and the plural
as well as the singular number, unless the intention to give a
more limited meaning is declared by the context.
(11) "Processed" or "processing" as applied to:
(A) Oil and natural gas shall not include any conversion or
refining process; and
(B) Limestone or sandstone quarried or mined shall not
include any treatment process or transportation after the
limestone or sandstone is severed from the earth.
(12) "Related parties" means two or more persons,
organizations or businesses owned or controlled directly or
indirectly by the same interests. Control exists if a contract
or lease, either written or oral, is entered into whereby one
party mines or processes natural resources owned or held by
another party and the owner or lessor participates in the
severing, processing or marketing of the natural resources or
receives any value other than an arm's length passive royalty
interest. In the case of related parties, the tax commissioner
may apportion or allocate the receipts between or among such
persons, organizations or businesses if he determines that such
apportionment or allocation is necessary to more clearly reflect
gross value.
(13) "Sale" includes any transfer of the ownership or title
to property, whether for money or in exchange for other property
or services, or any combination thereof.
(14) "Severing" or "severed" means the physical removal ofthe natural resources from the earth or waters of this state by
any means:
Provided, That "severing" or "severed" shall not
include the removal of natural gas from underground storage
facilities into which the natural gas has been mechanically
injected following its initial removal from the earth:
Provided,
however, That "severing" or "severed" oil and natural gas shall
not include any separation process of oil or natural gas commonly
employed to obtain marketable natural resource products.
(15) "Stock" includes shares in an association, joint-stock
company or corporation.
(16) "Tax commissioner" means the tax commissioner of the
state of West Virginia, or his delegate.
(17) "Taxable year" means the calendar year, or the fiscal
year ending during such calendar year, upon the basis of which
tax liability is computed under this article. "Taxable year"
means, in case of a return made for a fractional part of a year
under the provisions of this article, or under regulations
promulgated by the tax commissioner, the period for which such
return is made.
(18) "Taxpayer" means and includes any individual,
partnership, joint venture, association, corporation, receiver,
trustee, guardian, executor, administrator, fiduciary or
representative of any kind engaged in the business of severing or
processing (or both severing and processing) natural resources in
this state for sale or use. In instances where contracts (either
oral or written) are entered into whereby persons, organizations
or businesses are engaged in the business of severing orprocessing (or both severing and processing) a natural resource
but do not obtain title to or do not have an economic interest
therein, the party who owns the natural resource or has an
economic interest therein is the taxpayer.
(19) "This code" means the code of West Virginia, one
thousand nine hundred thirty-one, as amended.
(20) "This state" means the state of West Virginia.
ARTICLE 13C. BUSINESS INVESTMENT AND JOBS EXPANSION CREDIT.
§11-13C-5. Application of annual credit allowance.
(a)
In general. -- The aggregate annual credit allowance for
the current taxable year is an amount equal to the sum of the
following as modified under subsections (o) and (p) of this
section:
(1) The one-tenth part allowed under section four of this
article for qualified investment placed into service or use
during a prior taxable year; plus
(2) The one-tenth part allowed under section four of this
article for qualified investment placed into service or use
during the current taxable year; plus
(3) The one-tenth part allowed under section four-a of this
article for locating corporate headquarters in this state; or the
amount allowed under section seven-a of this article of the
taxable year.
(b)
Application of current year annual credit allowance. --
The amount determined under subsection (a) of this section shall
be allowed as a credit against that portion of the taxpayer's
state tax liability which is attributable to and the directresult of the taxpayer's qualified investment, and shall be
applied as provided in subsections (c) through (k), both
inclusive, of this section, and in that order.
(c)
Business and occupation taxes. --
(1) That portion of the allowable credit attributable to
qualified investment in a business or other activity subject to
the taxes imposed by article thirteen of this chapter shall first
be applied to reduce up to eighty percent of the taxes imposed by
said article for the taxable year (determined before application
of allowable credits against tax and the annual exemption).
(2) If the taxes due under article thirteen of this chapter
are not solely attributable to and the direct result of the
taxpayer's qualified investment in a business or other activity
taxable under said article, the amount of such taxes, which are
so attributable, shall be determined by multiplying the amount of
taxes due under said article, for the taxable year (determined
before application of any allowable credits against tax and the
annual exemption), by a fraction, the numerator of which is all
wages, salaries and other compensation paid during the taxable
year to all employees of the taxpayer employed in this state,
whose positions are directly attributable to the qualified
investment in a business or other activity taxable under said
article. The denominator of the fraction shall be the wages,
salaries and other compensation paid during the taxable year to
all employees of the taxpayer employed in this state, whose
positions are directly attributable to the business or other
activity of the taxpayer that is taxable under said article.
(3) The annual exemption allowed by section three, article
thirteen of this chapter, plus any credits allowable under
articles thirteen-d and thirteen-e of this chapter, shall be
applied against and reduce only the portion of article thirteen
taxes not apportioned to the qualified investment under this
article:
Provided, That any excess exemption or credits may be
applied against the amount of article thirteen taxes apportioned
to the qualified investment under this article, that is not
offset by the amount of annual credit against such taxes allowed
under this article for the taxable year, unless their application
is otherwise prohibited by this chapter.
(d)
Carrier income taxes. --
(1) That portion of the allowable credit attributable to
qualified investment in a business or other activity subject to
the taxes imposed by article twelve-a of this chapter shall first
be applied to reduce up to eighty percent of the taxes imposed by
said article for the taxable year.
(2) If the taxes due under article twelve-a of this chapter
are not solely attributable to and the direct result of the
taxpayer's qualified investment in a business or other activity
taxable under said article, the amount of such taxes, which are
so attributable, shall be determined by multiplying the amount of
taxes due under said article for the taxable year, by a fraction,
the numerator of which is all wages, salaries and other
compensation paid during the taxable year to all employees of the
taxpayer employed in this state, whose positions are directly
attributable to the qualified investment in a business or otheractivity taxable under said article. The denominator of the
fraction shall be the wages, salaries and other compensation paid
during the taxable year to all employees of the taxpayer,
employed in this state, whose positions are directly attributable
to the business or other activity of the taxpayer that is taxable
under said article.
(e)
Severance taxes. --
(1) On and after the first day of July, one thousand nine
hundred eighty-seven, that portion of the allowable credit
attributable to qualified investment in a business or other
activity subject to the tax imposed by article thirteen-a of this
chapter, and qualified investment in a business or activity that
was subject to the tax imposed by article thirteen of this
chapter prior to said first day of July, but on and after said
first day of July, is subject to the tax imposed by article
thirteen-a of this chapter, shall first be applied to reduce up
to eighty percent of the taxes imposed by said article for the
taxable year (determined before application of any allowable
credits against tax).
(2) If the taxes due under article thirteen-a of this
chapter are not solely attributable to and the direct result of
the taxpayer's qualified investment in a business or other
activity taxable under said article, the amount of such taxes
which are so attributable, shall be determined by multiplying the
amount of taxes due under said article for the taxable year
(determined before application of any allowable credits against
tax), by a fraction, the numerator of which is all wages,salaries and other compensation paid during the taxable year to
all employees of the taxpayer employed in this state, whose
positions are directly attributable to the qualified investment
in a business or other activity taxable under said article. The
denominator of the fraction shall be the wages, salaries and
other compensation paid during the taxable year to all employees
of the taxpayer employed in this state, whose positions are
directly attributable to the business or other activity of the
taxpayer that is taxable under said article.
(3) Any credits allowable under articles thirteen-d and
thirteen-e of this chapter shall be applied against and reduce
only the portion of article thirteen-a taxes not apportioned to
the qualified investment under this article:
Provided, That any
excess credits may be applied against the amount of article
thirteen taxes apportioned to the qualified investment under this
article, that is not offset by the amount of annual credit
against such taxes allowed under this article for the taxable
year, unless their application is otherwise prohibited by this
chapter.
(f)
Telecommunications taxes. --
(1) On and after the first day of July, one thousand nine
hundred eighty-seven, that portion of the allowable credit
attributable to qualified investment in a business or other
activity subject to the taxes imposed by article thirteen-b of
this chapter, shall first be applied to reduce up to eighty
percent of the taxes imposed by said article for the taxable year
(determined before application of allowable credits against tax)and qualified investment in a business or activity that was
subject to the taxes imposed by article twelve-a of this chapter
prior to said first day of July, but on and after said first day
of July is subject to the tax imposed by article thirteen-b of
this chapter.
(2) If the taxes due under article thirteen-b of this
chapter are not solely attributable to and the direct result of
the taxpayer's qualified investment in a business or other
activity taxable under said article, the amount of such taxes,
which are so attributable, shall be determined by multiplying the
amount of taxes due under said article for the taxable year
(determined before application of any allowable credits against
tax), by a fraction, the numerator of which is all wages,
salaries and other compensation paid during the taxable year to
all employees of the taxpayer employed in this state whose
positions are directly attributable to the qualified investment
in a business or other activity taxable under said article. The
denominator of the fraction shall be the wages, salaries and
other compensation paid during the taxable year to all employees
of the taxpayer employed in this state whose positions are
directly attributable to the business or other activity of the
taxpayer that is taxable under said article.
(g)
Business franchise tax. --
(1) On and after the first day of July, one thousand nine
hundred eighty-seven, that portion of the allowable credit
attributable to qualified investment in a business or activity
subject to the taxes imposed by article twenty-three of thischapter, and qualified investment in a business or activity that
was subject to the taxes imposed by article thirteen of this
chapter prior to said first day of July, but on and after said
first day of July, is subject to the tax imposed by article
twenty-three of this chapter, shall first be applied to reduce up
to eighty percent of the taxes imposed by said article for the
taxable year (determined after application of the credits against
tax provided in section seventeen of said article, but before
application of any other allowable credits against tax).
(2) If the taxes due under article twenty-three of this
chapter are not solely attributable to and the direct result of
the taxpayer's qualified investment in a business or other
activity taxable under said article for the taxable year
(determined after application of the credits against tax provided
in section seventeen of said article, but before application of
any other allowable credits), by a fraction, the numerator of
which is all wages, salaries and other compensation paid during
the taxable year to all employees of the taxpayer employed in
this state, whose positions are directly attributable to the
qualified investment in a business or other activity taxable
under said article. The denominator of the fraction shall be
wages, salaries and other compensation paid during the taxable
year to all employees of the taxpayer employed in this state,
whose positions are directly attributable to the business or
other activity of the taxpayer that is taxable under said
article.
(3) Any credits allowable under articles thirteen-d andthirteen-e of this chapter shall be applied against and reduce
only the portion of article twenty-three taxes not apportioned to
the qualified investment under this article:
Provided, That any
excess exemption or credits may be applied against the amount of
article twenty-three taxes apportioned to the qualified
investment under this article that is not offset by the amount of
annual credit against such taxes allowed under this article for
the taxable year, unless their application is otherwise
prohibited by this chapter.
(h)
Corporation net income taxes. --
(1) After application of subsections (c) through (g), both
inclusive of this section, any unused credit shall next be
applied to reduce up to eighty percent of the taxes imposed by
article twenty-four of this chapter for the taxable year
(determined before application of allowable credits against tax).
(2) If the taxes due under article twenty-four of this
chapter (determined before application of allowable credits
against tax) are not solely attributable to and the direct result
of the taxpayer's qualified investment, the amount of such taxes
which are so attributable, shall be determined by multiplying the
amount of taxes due under said article for the taxable year
(determined before application of allowable credits against tax),
by a fraction, the numerator of which is all wages, salaries and
other compensation paid during the taxable year to all employees
of the taxpayer employed in this state whose positions are
directly attributable to the qualified investment. The
denominator of the fraction shall be the wages, salaries andother compensation paid during the taxable year to all employees
of the taxpayer employed in this state.
(3) Any credits allowable under article twenty-four of this
chapter shall be applied against and reduce only the amount of
article twenty-four taxes not apportioned to the qualified
investment under this article:
Provided, That any excess credits
may be applied against the amount of article twenty-four taxes
apportioned to the qualified investment under this article that
is not offset by the amount of annual credit against such taxes
allowed under this article for the taxable year, unless their
application is otherwise prohibited by this chapter.
(i)
Personal income taxes. --
(1) If the person making the qualified investment is an
electing small business corporation (as defined in Section 1361
of the United States Internal Revenue Code of 1954, as amended),
a partnership or a sole proprietorship, then any unused credit
(after application of subsections (c), (d), (e), (f) and (g))
shall be allowed as a credit against up to eighty percent of the
taxes imposed by article twenty-one of this chapter on the income
from business or other activity subject to tax under article
twelve-a, thirteen, thirteen-a, thirteen-b or twenty-three of
this chapter.
(2) Electing small business corporations, partnerships and
other unincorporated organizations shall allocate the credit
allowed by this article among its members in the same manner as
profits and losses are allocated for the taxable year.
(3) If the amount of taxes due under article twenty-one ofthis chapter (determined before application of allowable credits
against tax) that is attributable to business, is not solely
attributable to and the direct result of the qualified investment
of the electing small business corporation, partnership, other
unincorporated organization or sole proprietorship, the amount of
such taxes which are so attributable shall be determined by
multiplying the amount of taxes due under said article
(determined before application of allowable credits against tax),
that is attributable to business by a fraction, the numerator of
which is all wages, salaries and other compensation paid during
the taxable year to all employees of the electing small business
corporation, partnership, other unincorporated organization or
sole proprietorship employed in this state, whose positions are
directly attributable to the qualified investment. The
denominator of the fraction shall be the wages, salaries and
other compensation paid during the taxable year to all employees
of the taxpayer.
(4) No credit shall be allowed under this section against
any employer withholding taxes imposed by article twenty-one of
this chapter.
(j) For tax years beginning after the thirty-first day of
December, one thousand nine hundred ninety-two, and thereafter,
if the formula provisions of subsections (c) through (i) of this
section, inclusive, do not fairly represent the taxes solely
attributable to and the direct result of the taxpayer's qualified
investment of the taxpayer and all other project participants in
the business or other activity subject to tax, the commissionermay require, in respect to all or any part of the taxpayer's
businesses or activities, if reasonable:
(1) Separate accounting or identification; or
(2) Adjustment to the wages formula to reflect all
components of the tax liability; or
(3) The inclusion of one or more additional factors which
will fairly represent the taxes solely attributable to and the
direct result of the qualified investment of the taxpayer and all
other project participants in the businesses or other activities
subject to tax; or
(4) The employment of any other method to effectuate an
equitable attribution of the taxes.
In order to effectuate the purposes of this subsection, the
commissioner shall propose for promulgation legislative rules in
accordance with article three, chapter twenty-nine-a of this
code:
Provided, That the initial promulgation may be by
emergency rule. The rule shall set forth the standards by which
this subsection will be implemented and enforced:
Provided,
however, That with regard to investment placed in service prior
to the passage of this provision, taxpayers having a specific
written determination from the tax commissioner that the taxpayer
is authorized or required to take credit against tax not
attributable to qualified investment shall not be subject to the
alternative allocation of credit provided for under this
subsection.
(k)
Sales and use taxes. --
On and after the first day of July, one thousand ninehundred eighty-seven, for purchases of tangible personal property
and taxable services made on or after that date, that portion of
the allowable credit, which is attributable to qualified
investment in a business or activity subject to the taxes imposed
by articles fifteen and fifteen-a of this chapter on purchases
for use or consumption in the conduct of such business or
activity, shall be applied to reduce up to eighty percent of the
taxes imposed by said articles on purchases that are directly
used or consumed in the qualified investment activity. When
property and services purchased for use or consumption are not
solely used or consumed in the qualified investment activity, the
cost thereof shall be apportioned between such activities. Only
that amount apportioned to purchases directly used or consumed in
the qualified investment activity shall be included when applying
the credit allowable under this subsection. On and after the
first day of July, one thousand nine hundred ninety-three, for
purchases of tangible personal property and taxable services made
on or after that date for use or consumption in the conduct of
business, no portion of the allowable credit may be applied
against the taxes imposed by said articles.
(l)
Ad valorem property taxes; unemployment taxes and
workers' compensation premiums. --
(1) After application of subsections (a) through (i), both
inclusive, of this section, any unused credit shall be applied as
a rebate for payment of the sum of the following amounts:
(A) Eighty percent of the ad valorem property taxes imposed
by levying bodies pursuant to article eight of this chapter, forthe taxable year (including payments in lieu of such taxes), on
property of the taxpayer that is directly attributable to the
qualified investment (including property having a useful life of
less than four years) of the taxpayer, in the new or expanded
business facility of the taxpayer resulting in new jobs; plus
(B) Eighty percent of the taxes imposed by article five,
chapter twenty-one-a of this code for the taxable year
attributable to the compensation of new employees filling the new
jobs that are directly attributable to the qualified investment;
plus
(C) Twenty percent of the workers' compensation premiums
imposed by article two, chapter twenty-three of this code, for
the taxable year attributable to the compensation paid new
employees filling the new jobs, that are directly attributable to
the qualified investment.
(2) A taxpayer eligible to claim this rebate shall apply
either the amount of the unused credit or the sum determined
under subdivision (1) of this subsection, whichever is less,
against the remaining twenty percent of the taxes imposed by
articles twelve-a, thirteen, thirteen-a, thirteen-b, twenty-one,
twenty-three and twenty-four of this chapter, attributable to the
qualified investment under this article. If any amount of rebate
remains after its application against the remaining twenty
percent of taxes as aforesaid, the amount remaining shall be
carried forward to each ensuing tax year until used or the
expiration of the twelfth subsequent tax year in which the
qualified investment was placed in service or use in this stateby the taxpayer.
(m)
Unused credit forfeited. -- If any credit remains after
application of subsection (b) of this section, the amount thereof
shall be forfeited. No carryover to a subsequent taxable year or
carryback to a prior taxable year shall be allowed for the amount
of any unused portion of any annual credit allowance, except as
specifically provided in subsection (l), (o) or (p) of this
section.
(n) Notwithstanding any provision of this section to the
contrary and notwithstanding the reenactment of this section
later in time than the enactment or reenactment of section
fourteen of this article, the restrictions, limitations,
constraints and provisions of said section shall apply to and
supersede the provisions of this section.
(o)
Deferral of twenty percent of annual credit, eighty
percent current limitation. --
(1) Eighty percent of the amount of annual credit calculated
under subsections (a) through (n) of this section before
application of the minimum severance tax against coal and before
the adjustment set forth in subsection (p) of this section, shall
be applied against the taxes enumerated in subsections (c)
through (i), inclusive, of this section for the current tax year.
(2) The remaining twenty percent of such annual credit so
calculated in subsections (c) through (n) of this section shall
be applied against the taxes enumerated in subsections (c)
through (i), inclusive, of this section beginning in the tenth
tax year subsequent to the tax year in which qualified investmentwas first placed in service or use in this state by the taxpayer,
and the amount thereof remaining shall be carried forward each
ensuing tax year until used or until the expiration of the
twelfth tax year subsequent to the tax year in which qualified
investment was first placed in service or use in this state by
the taxpayer. No deferral of credit under this subsection shall
apply to this credit when applied in such tenth through twelfth
years.
(p)
Additional allowance. --
(1) After application of up to eighty percent of annual
credit against the taxes enumerated in subsections (c) through
(i), inclusive, of this section for the current tax year under
subsection (o) of this section, there shall be allowed an
additional amount of credit, as determined under subdivision (2)
of this subsection, which may offset up to one hundred percent of
the remaining taxes enumerated in subsections (g), (h) and (i),
in that order, of this section for the current tax year. Any
credit calculated and determined under this subsection which
remains after application against the taxes enumerated in
subsections (g), (h) and (i) under this section shall be
forfeited and shall not carryover to any other taxable year.
(2) The amount of credit allowable under this subsection
shall be the lesser of one third of the taxpayer's minimum
severance tax on coal payable, or the taxpayer's net minimum
severance tax on coal payable. For purposes of this subsection,
the term "net minimum severance tax on coal payable" means the
amount of the excess of the minimum severance tax on coal overthe amount of the state severance tax on coal severed and
extracted by the taxpayer in this state not including the
additional severance tax on coal imposed by section six, article
thirteen-a of this chapter, calculated after application of the
credit allowed under this article, and before application of all
other credits, and after application of the five hundred dollar
exemption to the said severance tax on coal.
(q)
Effective date. --
(1) This section, as amended in the year one thousand nine
hundred eighty-six, shall be effective upon passage. It shall be
retroactive, and shall be in lieu of the method provided by this
section for application of this credit prior to this amendment,
for qualified investment made on or after the first day of March,
one thousand nine hundred eighty-five.
(2) This section, as amended in the year one thousand nine
hundred eighty-seven, shall be effective for taxable years ending
after the thirtieth day of June, one thousand nine hundred
eighty-seven.
(3) This section, as amended in the year one thousand nine
hundred ninety-three, shall be effective for taxable years ending
after the thirty-first day of May, one thousand nine hundred
ninety-three.
§11-13C-15. One-year suspension of new credit entitlements,
exceptions, effective date.
(a) Notwithstanding any other provision of this article to
the contrary, no entitlement to the business investment and jobs
expansion tax credit under this article shall result from, and nocredit shall be available to any taxpayer for, investment placed
in service or use during the period beginning on the date of
passage of this section by the Legislature, and ending on the
three hundred sixty-sixth day thereafter.
(b) The suspension of new entitlements to credits set forth
in subsection (a) of this section shall not apply to companies,
entities or taxpayers engaged in the following industries or
business activities:
(1) Manufacturing, including, but not limited to, chemical
processing and chemical manufacturing, manufacture of wood
products and forestry products, manufacture of aluminum,
manufacture of paper, paper processing, recyclable paper
processing, food processing, manufacture of aircraft or aircraft
parts, manufacture of automobiles or automobile parts, and all
other manufacturing activities, but not timbering or timber
severance or timber hauling, or mineral severance, hauling,
processing or preparation, or coal severance, hauling, processing
or preparation;
(2) Information processing, including, but not limited to,
telemarketing, information processing, systems engineering,
backoffice operations and software development;
(3) The activity of warehousing, including, but not limited
to, commercial warehousing and the operation of regional
distribution centers by manufacturers, wholesalers or retailers;
(4) The activity of goods distribution;
(5) Destination-oriented recreation and tourism.
(c) Notwithstanding the fact that a company, entity ortaxpayer is engaged in an industry or business activity
enumerated in subsection (b) of this section, such company,
entity or taxpayer must qualify for the business investment and
jobs expansion tax credit by fulfilling the qualified investment,
jobs creation and other credit entitlement requirements of the
business investment and jobs expansion tax credit act in order to
obtain entitlement to any credit under this article. Failure to
fulfill the statutory requirements of the business investment and
jobs expansion tax credit act will result in a partial or
complete loss of the tax credit.
(d)
Transition rule. -- Notwithstanding any provision herein
contained to the contrary, this section shall not apply to
investments for which applications for credit or applications for
projected certification were filed prior to the effective date of
this section.
(e)
Effective date. -- This section shall be effective upon
passage by the Legislature.
(f)
Reports to the Legislature. -- On or before the
fifteenth day of January, one thousand nine hundred ninety-four,
the secretary of the department of tax and revenue shall submit
a report to the governor, the president of the Senate and the
speaker of the House of Delegates. The report shall include
recommendations regarding a tax credit to promote economic
development to replace the business investment and jobs expansion
credit provided pursuant to this article. The recommended
replacement credit should provide for a maximum amount of total
credit which may be taken by all taxpayers in any one year sothat the total fiscal impact of the credit to the state can be
readily determined. The secretary shall consult with all other
state agencies that are responsible for economic development in
this state and include any recommendations forthcoming from those
agencies in the report.
ARTICLE 13D. TAX CREDITS FOR INDUSTRIAL EXPANSION AND
REVITALIZATION, RESEARCH AND DEVELOPMENT PROJECTS, CERTAIN
HOUSING DEVELOPMENT PROJECTS, MANAGEMENT INFORMATION
SERVICES FACILITIES, AND INDUSTRIAL FACILITIES PRODUCING
COAL-BASED LIQUIDS USED TO PRODUCE SYNTHETIC FUELS.
§11-13D-3e. Application of credit after June 30, 1993.
Notwithstanding any other provision of this code to the
contrary, for taxable years ending on and after the first day of
July, one thousand nine hundred ninety-three, the credits allowed
under section three may not be applied to reduce the taxes
imposed by articles fifteen and fifteen-a of this chapter:
Provided, That this section shall not apply to credits allowed
under subsection (g), section three of this article for qualified
housing development projects existing in this state on or before
the first day of July, one thousand nine hundred ninety-two.
ARTICLE 13E. BUSINESS AND OCCUPATION TAX CREDIT FOR COAL LOADING
FACILITIES.
§11-13E-3b. Application of credit after June 30, 1993.
Notwithstanding any other provision of this code to the
contrary, for taxable years ending on and after the first day of
July, one thousand nine hundred ninety-three, the credits allowed
under section three may not be applied to reduce the taxesimposed by articles fifteen and fifteen-a of this chapter.
ARTICLE 15. CONSUMERS SALES TAX.
§11-15-2. Definitions.
For the purpose of this article:
(a) "Persons" means any individual, partnership,
association, corporation, state or its political subdivisions or
agency of either, guardian, trustee, committee, executor or
administrator.
(b) "Tax commissioner" means the state tax commissioner.
(c) "Gross proceeds" means the amount received in money,
credits, property or other consideration from sales and services
within this state, without deduction on account of the cost of
property sold, amounts paid for interest or discounts or other
expenses whatsoever. Losses shall not be deducted, but any
credit or refund made for goods returned may be deducted.
(d) "Sale", "sales" or "selling" includes any transfer of
the possession or ownership of tangible personal property for a
consideration, including a lease or rental, when the transfer or
delivery is made in the ordinary course of the transferor's
business and is made to the transferee or his agent for
consumption or use or any other purpose.
(e) "Vendor" means any person engaged in this state in
furnishing services taxed by this article or making sales of
tangible personal property.
(f) "Ultimate consumer" or "consumer" means a person who
uses or consumes services or personal property.
(g) "Business" includes all activities engaged in or causedto be engaged in with the object of gain or economic benefit,
direct or indirect, and all activities of the state and its
political subdivisions which involve sales of tangible personal
property or the rendering of services when those service
activities compete with or may compete with the activities of
other persons.
(h) "Tax" includes all taxes, interest and penalties levied
hereunder.
(i) "Service" or "selected service" includes all
nonprofessional activities engaged in for other persons for a
consideration, which involve the rendering of a service as
distinguished from the sale of tangible personal property, but
shall not include contracting, personal services or the services
rendered by an employee to his employer or any service rendered
for resale.
(j) "Purchaser" means a person who purchases tangible
personal property or a service taxed by this article.
(k) "Personal service" includes those:
(1) Compensated by the payment of wages in the ordinary
course of employment; and
(2) Rendered to the person of an individual without, at the
same time, selling tangible personal property, such as nursing,
barbering, shoe shining, manicuring and similar services.
(l) "Taxpayer" means any person liable for the tax imposed
by this article.
(m) "Drugs" includes all sales of drugs or appliances to a
purchaser, upon prescription of a physician or dentist and anyother professional person licensed to prescribe.
(n) (1) "Directly used or consumed" in the activities of
manufacturing, transportation, transmission, communication or the
production of natural resources means used or consumed in those
activities or operations which constitute an integral and
essential part of such activities, as contrasted with and
distinguished from those activities or operations which are
simply incidental, convenient or remote to such activities.
(2) Uses of property or consumption of services which
constitute direct use or consumption in the activities of
manufacturing, transportation, transmission, communication or the
production of natural resources includes only:
(A) In the case of tangible personal property, physical
incorporation of property into a finished product resulting from
manufacturing production or the production of natural resources;
(B) Causing a direct physical, chemical or other change upon
property undergoing manufacturing production or production of
natural resources;
(C) Transporting or storing property undergoing
transportation, communication, transmission, manufacturing
production or production of natural resources;
(D) Measuring or verifying a change in property directly
used in transportation, communication, transmission,
manufacturing production or production of natural resources;
(E) Physically controlling or directing the physical
movement or operation of property directly used in
transportation, communication, transmission, manufacturingproduction or production of natural resources;
(F) Directly and physically recording the flow of property
undergoing transportation, communication, transmission,
manufacturing production or production of natural resources;
(G) Producing energy for property directly used in
transportation, communication, transmission, manufacturing
production or production of natural resources;
(H) Facilitating the transmission of gas, water, steam or
electricity from the point of their diversion to property
directly used in transportation, communication, transmission,
manufacturing production or production of natural resources;
(I) Controlling or otherwise regulating atmospheric
conditions required for transportation, communication,
transmission, manufacturing production or production of natural
resources;
(J) Serving as an operating supply for property undergoing
transmission, manufacturing production or production of natural
resources, or for property directly used in transportation,
communication, transmission, manufacturing production or
production of natural resources;
(K) Maintenance or repair of property, including maintenance
equipment, directly used in transportation, communication,
transmission, manufacturing production or production of natural
resources;
(L) Storage, removal or transportation of economic waste
resulting from the activities of manufacturing, transportation,
communication, transmission or the production of naturalresources;
(M) Pollution control or environmental quality or protection
activity directly relating to the activities of manufacturing,
transportation, communication, transmission or the production of
natural resources and personnel, plant, product or community
safety or security activity directly relating to the activities
of manufacturing, transportation, communication, transmission or
the production of natural resources; or
(N) Otherwise be used as an integral and essential part of
transportation, communication, transmission, manufacturing
production or production of natural resources.
(3) Uses of property or services which would not constitute
direct use or consumption in the activities of manufacturing,
transportation, transmission, communication or the production of
natural resources include, but are not limited to:
(A) Heating and illumination of office buildings;
(B) Janitorial or general cleaning activities;
(C) Personal comfort of personnel;
(D) Production planning, scheduling of work, or inventory
control;
(E) Marketing, general management, supervision, finance,
training, accounting and administration; or
(F) An activity or function incidental or convenient to
transportation, communication, transmission, manufacturing
production or production of natural resources, rather than an
integral and essential part of such activities.
(o) "Contracting":
(1)
In general. -- "Contracting" means and includes the
furnishing of work, or both materials and work, for another (by
a sole contractor, general contractor, prime contractor or
subcontractor) in fulfillment of a contract for the construction,
alteration, repair, decoration or improvement of a new or
existing building or structure, or any part thereof, or for
removal or demolition of a building or structure, or any part
thereof, or for the alteration, improvement or development of
real property.
(2)
Form of contract not controlling. -- An activity that
falls within the scope of the definition of contracting shall
constitute contracting regardless of whether such contract
governing the activity is written or verbal and regardless of
whether it is in substance or form a lump sum contract, a cost-
plus contract, a time and materials contract, whether or not
open-ended, or any other kind of construction contract.
(3)
Special rules. -- For purposes of this definition:
(A) The term "structure" includes, but is not limited to,
everything built up or composed of parts joined together in some
definite manner and attached or affixed to real property, or
which adds utility to real property or any part thereof, or which
adds utility to a particular parcel of property and is intended
to remain there for an indefinite period of time.
(B) The term "alteration" means, and is limited to,
alterations which are capital improvements to a building or
structure or to real property.
(C) The term "repair" means, and is limited to, repairswhich are capital improvements to a building or structure or to
real property.
(D) The term "decoration" means, and is limited to,
decorations which are capital improvements to a building or
structure or to real property.
(E) The term "improvement" means, and is limited to,
improvements which are capital improvements to a building or
structure or to real property.
(F) The term "capital improvement" means improvements that
are affixed to or attached to and become a part of a building or
structure or the real property or which add utility to real
property or any part thereof and that last, or are intended to be
relatively permanent. As used herein, "relatively permanent"
means lasting at least a year or longer in duration without the
necessity for regularly scheduled recurring service to maintain
such capital improvement. "Regular recurring service" means
regularly scheduled service intervals of less than one year.
(G) Contracting does not include the furnishing of work, or
both materials and work in the nature of hookup, connection,
installation or other services if such service is incidental to
the retail sale of tangible personal property from the service
provider's inventory:
Provided, That such hookup, connection or
installation of the foregoing is incidental to the sale of the
same and performed by the seller thereof or performed in
accordance with arrangements made by the seller thereof.
Examples of transactions that are excluded from the definition of
contracting pursuant hereto include, but are not limited to, thesale of wall-to-wall carpeting and the installation of wall-to-
wall carpeting, the sale, hookup and connection of mobile homes,
window air conditioning units, dishwashers, clothing washing
machines or dryers, other household appliances, drapery rods,
window shades, venetian blinds, canvas awnings, free standing
industrial or commercial equipment and other similar items of
tangible personal property. Repairs made to the foregoing are
within the definition of contracting if such repairs involve
permanently affixing to or improving real property or something
attached thereto which extends the life of the real property or
something affixed thereto or allows or is intended to allow such
real property or thing permanently attached thereto to remain in
service for a year or longer.
(p) "Manufacturing" means a systematic operation or
integrated series of systematic operations engaged in as a
business or segment of a business which transforms or converts
tangible personal property by physical, chemical or other means
into a different form, composition or character from that in
which it originally existed.
(q) "Transportation" means the act or process of conveying,
as a commercial enterprise, passengers or goods from one place or
geographical location to another place or geographical location.
(r) "Transmission" means the act or process of causing
liquid, natural gas or electricity to pass or be conveyed from
one place or geographical location to another place or
geographical location through a pipeline or other medium for
commercial purposes.
(s) "Communication" means all telephone, radio, light, light
wave, radio telephone, telegraph and other communication or means
of communication, whether used for voice communication, computer
data transmission or other encoded symbolic information transfers
and shall include commercial broadcast radio, commercial
broadcast television and cable television.
(t) "Production of natural resources" means the performance,
by either the owner of the natural resources or another, of the
act or process of exploring, developing, severing, extracting,
reducing to possession, processing and loading for shipment and
shipment for sale, profit or commercial use of any natural
resource products and any reclamation, waste disposal or
environmental activities associated therewith.
(u) "Management information services facility" means a
building, or any part thereof, or a complex of buildings, or any
part thereof, including the machinery and equipment located
therein, that is exclusively dedicated to providing management
information services to the owner or operator thereof or to
another person.
(v) "Management information services" means, and is limited
to, data processing, data storage, data recovery and backup,
programming recovery and backup, telecommunications, computation
and computer processing, computer programming, electronic
information, and data management activities, or any combination
of such activities, when such activity, or activities, is not
subject to regulation by the West Virginia public service
commission and such activity, or activities, is for the purposeof managing, planning for, organizing or operating, any
industrial or commercial business, or any enterprise, facility or
facilities of an industrial or commercial business, whether such
industrial or commercial business or enterprise, facility or
facilities of an industrial or commercial business is located
within or without this state and without regard to whether such
industrial or commercial business, or enterprise, facility or
facilities of an industrial or commercial business is owned by
the provider of the management information services or by a
"related person", as defined in Section 267(b) of the Internal
Revenue Code of 1986, as amended.
(w) (1) "Directly used or consumed" in the activities of gas
storage, the generation or production or sale of electric power,
the provision of a public utility service or the operation of a
utility business, means used or consumed in those activities or
operations which constitute an integral and essential part of
such activities or operation, as contrasted with and
distinguished from activities or operations which are simply
incidental, convenient or remote to such activities.
(2) Uses of property or consumption of services which
constitute direct use or consumption in the activities of gas
storage, the generation or production of sale of electric power,
the provision of a public utility service, or the operation of a
utility business include only:
(A) Tangible personal property or services, including
equipment, machinery, apparatus, supplies, fuel and power and
appliances, which are used immediately in production orgeneration activities and equipment, machinery, supplies, tools,
and repair parts used to keep in operation exempt production or
generation devices. For purposes of this subsection, production
or generation activities shall commence from the intake, receipt
or storage of raw materials at the production plant site;
(B) Tangible personal property or services, including
equipment, machinery, apparatus, supplies, fuel and power,
appliances, pipes, wires and mains which are used immediately in
the transmission or distribution of gas, water and electricity to
the public, and equipment, machinery, tools, repair parts and
supplies used to keep in operation exempt transmission or
distribution devices, and such vehicles and their equipment as
are specifically designed and equipped for such purposes are
exempt from the tax when used to keep a transmission or
distribution system in operation or repair. For purposes of this
subsection, transmission or distribution activities shall
commence from the close of production at a production plant or
wellhead when a product is ready for transmission or distribution
to the public and shall conclude at the point where the product
is received by the public;
(C) Tangible personal property or services, including
equipment, machinery, apparatus, supplies, fuel and power,
appliance, pipes, wires and mains, which are used immediately in
the storage of gas or water, and equipment, machinery, tools,
supplies and repair parts used to keep in operation exempt
storage devices;
(D) Tangible personal property or services used immediatelyin the storage, removal or transportation of economic waste
resulting from the activities of gas storage, the generation or
production or sale of electric power, the provision of a public
utility service, or the operation of a utility business;
(E) Tangible personal property or services used immediately
in pollution control or environmental quality or protection
activity or community safety or security directly relating to the
activities of gas storage, generation or production or sale of
electric power, the provision of a public utility service or the
operation of a utility business.
(3) Uses of property or services which would not constitute
direct use or consumption in the activities of gas storage,
generation or production or sale of electric power, the provision
of a public utility service or the operation of a utility
business include, but are not limited to:
(A) Heating and illumination of office buildings;
(B) Janitorial or general cleaning activities;
(C) Personal comfort of personnel;
(D) Production planning, scheduling of work or inventory
control;
(E) Marketing, general management, supervision, finance,
training, accounting and administration; or
(F) An activity or function incidental or convenient to the
activities of gas storage, generation or production or sale of
electric power, the provision of public utility service or the
operation of a utility business.
(x) "Gas storage" means the injection of gas into a storagereservoir, or the storage of gas for any period of time in a
storage reservoir, or the withdrawal of gas from a storage
reservoir, engaged in by businesses subject to the business and
occupation tax imposed by sections two and two-e, article
thirteen of this chapter.
(y) "Generating or producing or selling of electric power"
means the generation, production or sale of electric power
engaged in by businesses subject to the business and occupation
tax imposed by section two, two-d, two-m or two-n, article
thirteen of this chapter.
(z) "Providing a public service or the operating of a
utility business" means the providing of a public service or the
operating of a utility by businesses subject to the business and
occupation tax imposed by sections two and two-d, article
thirteen of this chapter.
§11-15-9. Exemptions.
The following sales and services are exempt:
(a) Sales of gas, steam and water delivered to consumers
through mains or pipes and sales of electricity;
(b) Sales of textbooks required to be used in any of the
schools of this state or in any institution in this state which
qualifies as a nonprofit or educational institution subject to
the West Virginia department of education and the arts, board of
trustees of the university system of West Virginia or the board
of directors for colleges located in this state;
(c) Sales of property or services to the state, its
institutions or subdivisions, governmental units, institutions orsubdivisions of other states:
Provided, That the law of such
other state provides the same exemption to governmental units or
subdivisions of this state and to the United States, including
agencies of federal, state or local governments for distribution
in public welfare or relief work;
(d) Sales of vehicles which are titled by the division of
motor vehicles and which are subject to the tax imposed by
section four, article three, chapter seventeen-a of this code, or
like tax;
(e) Sales of property or services to churches and bona fide
charitable organizations who make no charge whatsoever for the
services they render:
Provided, That the exemption herein
granted shall apply only to services, equipment, supplies, food
for meals and materials directly used or consumed by these
organizations, and shall not apply to purchases of gasoline or
special fuel;
(f) Sales of tangible personal property or services to a
corporation or organization which has a current registration
certificate issued under article twelve of this chapter is exempt
from federal income taxes under Section 501(c)(3) or (c)(4) of
the Internal Revenue Code of 1986, as amended, and is:
(1) A church or a convention or association of churches as
defined in Section 170 of the Internal Revenue Code of 1986, as
amended;
(2) An elementary or secondary school which maintains a
regular faculty and curriculum and has a regularly enrolled body
of pupils or students in attendance at the place in this statewhere its educational activities are regularly carried on;
(3) A corporation or organization which annually receives
more than one half of its support from any combination of gifts,
grants, direct or indirect charitable contributions or membership
fees;
(4) An organization which has no paid employees and its
gross income from fund raisers, less reasonable and necessary
expenses incurred to raise such gross income (or the tangible
personal property or services purchased with such net income), is
donated to an organization which is exempt from income taxes
under Section 501(c)(3) or (c)(4) of the Internal Revenue Code of
1986, as amended;
(5) A youth organization, such as the girl scouts of the
United States of America, the boy scouts of America or the YMCA
Indian guide/princess program and the local affiliates thereof,
which is organized and operated exclusively for charitable
purposes and has as its primary purpose the nonsectarian
character development and citizenship training of its members;
(6) For purposes of this subsection:
(A) The term "support" includes, but is not limited to:
(i) Gifts, grants, contributions or membership fees;
(ii) Gross receipts from fund raisers which include receipts
from admissions, sales of merchandise, performance of services or
furnishing of facilities in any activity which is not an
unrelated trade or business within the meaning of Section 513 of
the Internal Revenue Code of 1986, as amended;
(iii) Net income from unrelated business activities, whetheror not such activities are carried on regularly as a trade or
business;
(iv) Gross investment income as defined in Section 509(e) of
the Internal Revenue Code of 1986, as amended;
(v) Tax revenues levied for the benefit of a corporation or
organization either paid to or expended on behalf of such
organization; and
(vi) The value of services or facilities (exclusive of
services or facilities generally furnished to the public without
charge) furnished by a governmental unit referred to in Section
170(c)(1) of the Internal Revenue Code of 1986, as amended, to an
organization without charge. This term does not include any gain
from the sale or other disposition of property which would be
considered as gain from the sale or exchange of a capital asset,
or the value of an exemption from any federal, state or local tax
or any similar benefit;
(B) The term "charitable contribution" means a contribution
or gift to or for the use of a corporation or organization,
described in Section 170(c)(2) of the Internal Revenue Code of
1986, as amended;
(C) The term "membership fee" does not include any amounts
paid for tangible personal property or specific services rendered
to members by the corporation or organization; or
(7) The exemption allowed by this subsection does not apply
to sales of gasoline or special fuel or to sales of tangible
personal property or services to be used or consumed in the
generation of unrelated business income as defined in Section 513of the Internal Revenue Code of 1986, as amended. The provisions
of this subsection as amended by this article shall apply to
sales made after the thirtieth day of June, one thousand nine
hundred eighty-nine:
Provided, That the exemption herein granted
shall apply only to services, equipment, supplies and materials
used or consumed in the activities for which such organizations
qualify as tax exempt organizations under the Internal Revenue
Code by these organizations and shall not apply to purchases of
gasoline or special fuel;
(g) Sales of property or services to persons engaged in this
state in the business of manufacturing, transportation,
transmission, communication or in the production of natural
resources:
Provided, That on and after the first day of July,
one thousand nine hundred eighty-seven, the exemption provided in
this subsection shall apply only to services, machinery, supplies
and materials directly used or consumed in the activities of
manufacturing, transportation, transmission, communication or the
production of natural resources in the businesses or
organizations named above and shall not apply to purchases of
gasoline or special fuel:
Provided, however, That on and after
the first day of May, one thousand nine hundred ninety-three, the
exemption provided in this subsection shall apply only to
services, machinery, supplies and materials directly used or
consumed in the activities of manufacturing, transportation,
transmission, communication, production of natural resources, gas
storage, generation or production of selling electric power,
provision of a public utility service or the operation of autility service or the operation of a utility business, in the
businesses or organizations named above and shall not apply to
purchases of gasoline or special fuel;
(h) An isolated transaction in which any taxable service or
any tangible personal property is sold, transferred, offered for
sale or delivered by the owner thereof or by his representative
for the owner's account, such sale, transfer, offer for sale or
delivery not being made in the ordinary course of repeated and
successive transactions of like character by such owner or on his
account by such representative:
Provided, That nothing contained
herein may be construed to prevent an owner who sells, transfers
or offers for sale tangible personal property in an isolated
transaction through an auctioneer from availing himself or
herself of the exemption provided herein, regardless where such
isolated sale takes place. The tax commissioner may adopt such
legislative rule pursuant to chapter twenty-nine-a of this code
as he deems necessary for the efficient administration of this
exemption;
(i) Sales of tangible personal property or of any taxable
services rendered for use or consumption in connection with the
commercial production of an agricultural product the ultimate
sale of which will be subject to the tax imposed by this article
or which would have been subject to tax under this article:
Provided, That sales of tangible personal property and services
to be used or consumed in the construction of or permanent
improvement to real property and sales of gasoline and special
fuel shall not be exempt:
Provided, however, That nails andfencing shall not be considered as improvements to real property;
(j) Sales of tangible personal property to a person for the
purpose of resale in the form of tangible personal property:
Provided, That sales of gasoline and special fuel by distributors
and importers shall be taxable except when the sale is to another
distributor for resale:
Provided, however, That sales of building
materials or building supplies or other property to any person
engaging in the activity of contracting, as defined in this
article, which is to be installed in, affixed to or incorporated
by such person or his agent into any real property, building or
structure shall not be exempt under this subsection, except that
sales of tangible personal property to a person engaging in the
activity of contracting pursuant to a written contract with the
United States, this state, or with a political subdivision
thereof, or with a public corporation created by the Legislature
or by another governmental entity pursuant to an act of the
Legislature, for a building or structure, or improvement thereto,
or other improvement to real property that is or will be owned
and used by the governmental entity for a governmental or
proprietary purpose, who incorporates such property in such
building, structure or improvement shall, with respect to such
tangible personal property, nevertheless be deemed to be the
vendor of such property to the governmental entity and any person
seeking to qualify for and assert this exception must do so
pursuant to such legislative rules and regulations as the tax
commissioner may promulgate and upon such forms as the tax
commissioner may prescribe. A subcontractor who, pursuant to awritten subcontract with a prime contractor who qualifies for
this exception, provides equipment, or materials, and labor to
such a prime contractor shall be treated in the same manner as
the prime contractor is treated with respect to the prime
contract under this exception and the legislative rules and
regulations promulgated by the tax commissioner:
Provided
further, That the exemption for government contractors in the
preceding proviso shall expire on the first day of October, one
thousand nine hundred ninety, subject to the transition rules set
forth in section eight-c of this article;
(k) Sales of property or services to nationally chartered
fraternal or social organizations for the sole purpose of free
distribution in public welfare or relief work:
Provided, That
sales of gasoline and special fuel shall be taxable;
(l) Sales and services, fire fighting or station house
equipment, including construction and automotive, made to any
volunteer fire department organized and incorporated under the
laws of the state of West Virginia:
Provided, That sales of
gasoline and special fuel shall be taxable;
(m) Sales of newspapers when delivered to consumers by route
carriers;
(n) Sales of drugs dispensed upon prescription and sales of
insulin to consumers for medical purposes;
(o) Sales of radio and television broadcasting time,
preprinted advertising circulars and newspaper and outdoor
advertising space for the advertisement of goods or services;
(p) Sales and services performed by day-care centers;
(q) Casual and occasional sales of property or services not
conducted in a repeated manner or in the ordinary course of
repetitive and successive transactions of like character by a
corporation or organization which is exempt from tax under
subsection (f) of this section on its purchases of tangible
personal property or services:
(1) For purposes of this subsection, the term "casual and
occasional sales not conducted in a repeated manner or in the
ordinary course of repetitive and successive transactions of like
character" means sales of tangible personal property or services
at fund raisers sponsored by a corporation or organization which
is exempt, under subsection (f) of this section, from payment of
the tax imposed by this article on its purchases, when such fund
raisers are of limited duration and are held no more than six
times during any twelve-month period and limited duration means
no more than eighty-four consecutive hours;
(2) The provisions of this subsection, as amended by this
article, shall apply to sales made after the thirtieth day of
June, one thousand nine hundred eighty-nine;
(r) Sales of property or services to a school which has
approval from the board of trustees of the university system of
West Virginia or the board of directors of the state college
system to award degrees, which has its principal campus in this
state, and which is exempt from federal and state income taxes
under Section 501(c)(3) of the Internal Revenue Code of 1986, as
amended:
Provided, That sales of gasoline and special fuel shall
be taxable;
(s) Sales of mobile homes to be utilized by purchasers as
their principal year-round residence and dwelling:
Provided,
That these mobile homes shall be subject to tax at the three
percent rate;
(t) Sales of lottery tickets and materials by licensed
lottery sales agents and lottery retailers authorized by the
state lottery commission, under the provisions of article twenty-
two, chapter twenty-nine of this code;
(u) Leases of motor vehicles titled pursuant to the
provisions of article three, chapter seventeen-a of this code to
lessees for a period of thirty or more consecutive days. This
exemption shall apply to leases executed on or after the first
day of July, one thousand nine hundred eighty-seven, and to
payments under long-term leases executed before such date, for
months thereof beginning on or after such date;
(v) Sales of propane to consumers for poultry house heating
purposes, with any seller to such consumer who may have prior
paid such tax in his price, to not pass on the same to the
consumer, but to make application and receive refund of such tax
from the tax commissioner, pursuant to rules and regulations
which shall be promulgated by the tax commissioner; and
notwithstanding the provisions of section eighteen of this
article or any other provisions of such article to the contrary;
(w) Any sales of tangible personal property or services
purchased after the thirtieth day of September, one thousand nine
hundred eighty-seven, and lawfully paid for with food stamps
pursuant to the federal food stamp program codified in 7 UnitedStates Code, §2011, et seq., as amended, or with drafts issued
through the West Virginia special supplemental food program for
women, infants and children codified in 42 United States Code,
§1786;
(x) Sales of tickets for activities sponsored by elementary
and secondary schools located within this state;
(y) Sales of electronic data processing services and related
software:
Provided, That for the purposes of this subsection
"electronic data processing services" means: (1) The processing
of another's data, including all processes incident to processing
of data such as keypunching, keystroke verification, rearranging
or sorting of previously documented data for the purpose of data
entry or automatic processing and changing the medium on which
data is sorted, whether these processes are done by the same
person or several persons; and (2) providing access to computer
equipment for the purpose of processing data or examining or
acquiring data stored in or accessible to such computer
equipment;
(z) Tuition charged for attending educational summer camps;
(aa) Sales of building materials or building supplies or
other property to an organization qualified under Section
501(c)(3) or (c)(4) of the Internal Revenue Code of 1986, as
amended, which are to be installed in, affixed to or incorporated
by such organization or its agent into real property, or into a
building or structure which is or will be used as permanent low-
income housing, transitional housing, emergency homeless shelter,
domestic violence shelter or emergency children and youth shelterif such shelter is owned, managed, developed or operated by an
organization qualified under Section 501(c)(3) or (c)(4) of the
Internal Revenue Code of 1986, as amended;
(bb) Dispensing of services performed by one corporation for
another corporation when both corporations are members of the
same controlled group. Control means ownership, directly or
indirectly, of stock possessing fifty percent or more of the
total combined voting power of all classes of the stock of a
corporation entitled to vote or ownership, directly or
indirectly, of stock possessing fifty percent or more of the
value of the corporation;
(cc) Food for the following shall be exempt:
(1) Food purchased or sold by public or private schools,
school sponsored student organizations or school sponsored
parent-teacher associations to students enrolled in such school
or to employees of such school during normal school hours; but
not those sales of food made to the general public;
(2) Food purchased or sold by a public or private college or
university or by a student organization officially recognized by
such college or university to students enrolled at such college
or university when such sales are made on a contract basis so
that a fixed price is paid for consumption of food products for
a specific period of time without respect to the amount of food
product actually consumed by the particular individual
contracting for the sale and no money is paid at the time the
food product is served or consumed;
(3) Food purchased or sold by a charitable or privatenonprofit organization, a nonprofit organization or a
governmental agency under a program to provide food to low-income
persons at or below cost;
(4) Food sold in an occasional sale by a charitable or
nonprofit organization including volunteer fire departments and
rescue squads, if the purpose of the sale is to obtain revenue
for the functions and activities of the organization and the
revenue so obtained is actually expended for that purpose;
(5) Food sold by any religious organization at a social or
other gathering conducted by it or under its auspices, if the
purpose in selling the food is to obtain revenue for the
functions and activities of the organization and the revenue
obtained from selling the food is actually used in carrying on
such functions and activities:
Provided, That purchases made by
such organizations shall not be exempt as a purchase for resale;
(dd) Sales of food by little leagues, midget football
leagues, youth football or soccer leagues and similar types of
organizations, including scouting groups and church youth groups,
if the purpose in selling the food is to obtain revenue for the
functions and activities of the organization and the revenues
obtained from selling the food is actually used in supporting or
carrying on functions and activities of the groups:
Provided,
That such purchases made by such organizations shall not be
exempt as a purchase for resale;
(ee) Charges for room and meals by fraternities and
sororities to their members:
Provided, That such purchases made
by a fraternity or sorority shall not be exempt as a purchase forresale;
(ff) Sales of or charges for the transportation of
passengers in interstate commerce;
(gg) Sales of tangible personal property or services to any
person which this state is prohibited from taxing under the laws
of the United States or under the constitution of this state;
(hh) Sales of tangible personal property or services to any
person who claims exemption from the tax imposed by this article
or article fifteen-a of this chapter pursuant to the provisions
of any other chapter of this code;
(ii) Charges for the services of opening and closing a
burial lot;
(jj) Sales of livestock, poultry or other farm products in
their original state by the producer thereof or a member of the
producer's immediate family who is not otherwise engaged in
making retail sales of tangible personal property; and sales of
livestock sold at public sales sponsored by breeders or registry
associations or livestock auction markets:
Provided, That the
exemptions allowed by this subsection shall apply to sales made
on or after the first day of July, one thousand nine hundred
ninety, and may be claimed without presenting or obtaining
exemption certificates:
Provided, however, That the farmer shall
maintain adequate records;
(kk) Sales of motion picture films to motion picture
exhibitors for exhibition if the sale of tickets or the charge
for admission to the exhibition of the film is subject to the tax
imposed by this article and sales of coin-operated video arcademachines or video arcade games to a person engaged in the
business of providing such machines to the public for a charge
upon which the tax imposed by this article is remitted to the tax
commissioner:
Provided, That the exemption provided in this
subsection shall apply to sales made on or after the first day of
July, one thousand nine hundred ninety, and may be claimed by
presenting to the seller a properly executed exemption
certificate;
(ll) Sales of aircraft repair, remodeling and maintenance
services when such services are to an aircraft operated by a
certified or licensed carrier of persons or property, or by a
governmental entity, or to an engine or other component part of
an aircraft operated by a certificated or licensed carrier of
persons or property, or by a governmental entity and sales of
tangible personal property that is permanently affixed or
permanently attached as a component part of an aircraft owned or
operated by a certificated or licensed carrier of persons or
property, or by a governmental entity, as part of the repair,
remodeling or maintenance service and sales of machinery, tools
or equipment, directly used or consumed exclusively in the
repair, remodeling or maintenance of aircraft, aircraft engines
or aircraft component parts, for a certificated or licensed
carrier of persons or property, or for a governmental entity;
(mm) Sales of tangible personal property and services to a
person entitled to claim the tax credit for investment in certain
management information services facilities allowed under section
three-c, article thirteen-d of this chapter, pursuant to theissuance of a management information services tax credit
certification by the tax commissioner in accordance with
subsection (e) of said section, when such property or services
are directly used or consumed by the purchaser in the operation
of the management information services facility, as defined in
section two of this article for which credit is allowed under
section three-c, article thirteen-d of this chapter. Tangible
personal property, or services, directly used or consumed in the
operation of a management information services facility includes
only: (1) Computer processing and telecommunications equipment;
(2) data storage and input/output devices; (3) disaster recovery
services; (4) supplies; (5) application, telecommunication and
operating system software; (6) repair and maintenance of any of
the aforesaid items; and (7) other tangible personal property or
services directly used or consumed in the operation of a
management information services facility:
Provided, That the
property is purchased or leased after the thirty-first day of
March, one thousand nine hundred ninety-one. This exemption
shall not apply to tangible personal property, or services, that
are not directly used or consumed in the operation of a
management information services facility, or to gasoline or
special fuel:
Provided, however, That nothing in this paragraph
shall be construed to limit, exclude or preclude the application
or availability of any other exemption set forth in this section,
or elsewhere in this code, which might otherwise apply to any
sale of tangible personal property or services;
(nn) Charges for memberships or services provided by healthand fitness organizations relating to personalized fitness
programs;
(oo) Sales of services by individuals who baby-sit for a
profit:
Provided, That the gross receipts of the individual from
the performance of baby-sitting services do not exceed five
thousand dollars in a taxable year; and
(pp) A corporation or organization which is a not-for-profit
entity which charges membership dues utilized for and
contributing significantly to traffic and pedestrian safety and
education programs whether or not the corporation or organization
is exempt from income tax under Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended.
ARTICLE 21. PERSONAL INCOME TAX.
§11-21-12. West Virginia adjusted gross income of resident
individual.
(a)
General. -- The West Virginia adjusted gross income of
a resident individual means his federal adjusted gross income as
defined in the laws of the United States for the taxable year
with the modifications specified in this section.
(b)
Modifications increasing federal adjusted gross income.
-- There shall be added to federal adjusted gross income unless
already included therein the following items:
(1) Interest income on obligations of any state other than
this state or of a political subdivision of any such other state
unless created by compact or agreement to which this state is a
party;
(2) Interest or dividend income on obligations or securitiesof any authority, commission or instrumentality of the United
States, which the laws of the United States exempt from federal
income tax but not from state income taxes;
(3) Income taxes imposed by this state or any other taxing
jurisdiction, to the extent deductible in determining federal
adjusted gross income and not credited against federal income
tax:
Provided, That this modification shall not be made for
taxable years beginning after the thirty-first day of December,
one thousand nine hundred eighty-six;
(4) Interest on indebtedness incurred or continued to
purchase or carry obligations or securities the income from which
is exempt from tax under this article, to the extent deductible
in determining federal adjusted gross income;
(5) Interest on a depository institution tax-exempt savings
certificate which is allowed as an exclusion from federal gross
income under Section 128 of the Internal Revenue Code, for the
federal taxable year;
(6) The amount allowed as a deduction from federal gross
income under Section 221 of the Internal Revenue Code by married
couples who file a joint federal return for the federal taxable
year:
Provided, That this modification shall not be made for
taxable years beginning after the thirty-first day of December,
one thousand nine hundred eighty-six;
(7) The deferral value of certain income that is not
recognized for federal tax purposes, which value shall be an
amount equal to a percentage of the amount allowed as a deduction
in determining federal adjusted gross income pursuant to theaccelerated cost recovery system under Section 168 of the
Internal Revenue Code for the federal taxable year, with the
percentage of the federal deduction to be added as follows with
respect to the following recovery property: Three-year property
-- no modification; five-year property -- ten percent; ten-year
property -- fifteen percent; fifteen-year public utility property
-- twenty-five percent; and fifteen-year real property -- thirty-
five percent:
Provided, That this modification shall not apply
to any person whose federal deduction is determined by the use of
the straight line method:
Provided, however, That this
modification shall not be made for taxable years beginning after
the thirty-first day of December, one thousand nine hundred
eighty-six; and
(8) The amount of a lump sum distribution for which the
taxpayer has elected under Section 402(e) of the Internal Revenue
Code of 1986, as amended, to be separately taxed for federal
income tax purposes.
(c)
Modifications reducing federal adjusted gross income. --
There shall be subtracted from federal adjusted gross income to
the extent included therein:
(1) Interest income on obligations of the United States and
its possessions to the extent includible in gross income for
federal income tax purposes;
(2) Interest or dividend income on obligations or securities
of any authority, commission or instrumentality of the United
States or of the state of West Virginia to the extent includible
in gross income for federal income tax purposes but exempt fromstate income taxes under the laws of the United States or of the
state of West Virginia, including federal interest or dividends
paid to shareholders of a regulated investment company, under
Section 852 of the Internal Revenue Code for taxable years ending
after the thirtieth day of June, one thousand nine hundred
eighty-seven;
(3) Any gain from the sale or other disposition of property
having a higher fair market value on the first day of January,
one thousand nine hundred sixty-one, than the adjusted basis at
said date for federal income tax purposes:
Provided, That the
amount of this adjustment is limited to that portion of any such
gain which does not exceed the difference between such fair
market value and such adjusted basis:
Provided, however, That if
such gain is considered a long-term capital gain for federal
income tax purposes, the modification shall be limited to forty
percent of such portion of the gain:
Provided further, That this
modification shall not be made for taxable years beginning after
the thirty-first day of December, one thousand nine hundred
eighty-six;
(4) The amount of any refund or credit for overpayment of
income taxes imposed by this state, or any other taxing
jurisdiction, to the extent properly included in gross income for
federal income tax purposes;
(5) Annuities, retirement allowances, returns of
contributions and any other benefit received under the West
Virginia public employees retirement system, the West Virginia
state teachers retirement system and all forms of militaryretirement, including regular armed forces, reserves and national
guard, including any survivorship annuities derived therefrom, to
the extent includible in gross income for federal income tax
purposes:
Provided, That notwithstanding any provisions in this
code to the contrary this modification shall be limited to the
first two thousand dollars of benefits received under the West
Virginia public employees retirement system, the West Virginia
state teachers retirement system and all forms of military
retirement including regular armed forces, reserves and national
guard, including any survivorship annuities derived therefrom, to
the extent includible in gross income for federal income tax
purposes for taxable years beginning after the thirty-first day
of December, one thousand nine hundred eighty-six; and the first
two thousand dollars of benefits received under any federal
retirement system to which Title 4 U.S.C. §111 applies:
Provided, however, That the total modification under this
paragraph shall not exceed two thousand dollars per person
receiving such retirement benefits and this limitation shall
apply to all returns or amended returns filed after the last day
of December, one thousand nine hundred eighty-eight;
(6) Retirement income received in the form of pensions and
annuities after the thirty-first day of December, one thousand
nine hundred seventy-nine, under any West Virginia police, West
Virginia firemen's retirement system or the West Virginia
department of public safety death, disability and retirement
fund, including any survivorship annuities derived therefrom, to
the extent includible in gross income for federal income taxpurposes;
(7) Federal adjusted gross income in the amount of eight
thousand dollars received from any source after the thirty-first
day of December, one thousand nine hundred eighty-six, by any
person who has attained the age of sixty-five on or before the
last day of the taxable year, or by any person certified by
proper authority as permanently and totally disabled, regardless
of age, on or before the last day of the taxable year, to the
extent includible in federal adjusted gross income for federal
tax purposes:
Provided, That if a person has a medical
certification from a prior year and he is still permanently and
totally disabled, a copy of the original certificate is
acceptable as proof of disability. A copy of the form filed for
the federal disability income tax exclusion is acceptable:
Provided, however, That:
(i) Where the total modification under subdivisions (1),
(2), (5) and (6) of this subsection is eight thousand dollars per
person or more, no deduction shall be allowed under this
subdivision; and
(ii) Where the total modification under subdivisions (1),
(2), (5) and (6) of this subsection is less than eight thousand
dollars per person, the total modification allowed under this
subdivision for all gross income received by such person shall be
limited to the difference between eight thousand dollars and the
sum of modifications under such subdivisions;
(8) Federal adjusted gross income in the amount of eight
thousand dollars received from any source after the thirty-firstday of December, one thousand nine hundred eighty-six, by the
surviving spouse of any person who had attained the age of sixty-
five or who had been certified as permanently and totally
disabled, to the extent includible in federal adjusted gross
income for federal tax purposes:
Provided, That:
(i) Where the total modification under subdivisions (1),
(2), (5), (6) and (7) of this subsection is eight thousand
dollars or more, no deduction shall be allowed under this
subdivision; and
(ii) Where the total modification under subdivisions (1),
(2), (5), (6) and (7) of this subsection is less than eight
thousand dollars per person, the total modification allowed under
this subdivision for all gross income received by such person
shall be limited to the difference between eight thousand dollars
and the sum of such subdivisions;
(9) Any pay or allowances received, after the thirty-first
day of December, one thousand nine hundred seventy-nine, by West
Virginia residents who have not attained the age of sixty-five,
as compensation for active service in the armed forces of the
United States:
Provided, That such deduction shall be limited to
an amount not to exceed four thousand dollars:
Provided,
however, That this modification shall not be made for taxable
years beginning after the thirty-first day of December, one
thousand nine hundred eighty-six;
(10) Gross income to the extent included in federal adjusted
gross income under Section 86 of the Internal Revenue Code for
federal income tax purposes:
Provided, That this modificationshall not be made for taxable years beginning after the thirty-
first day of December, one thousand nine hundred eighty-six;
(11) The amount of any lottery prize awarded by the West
Virginia state lottery commission, to the extent properly
included in gross income for federal income tax purposes:
Provided, That for taxable years beginning after the thirty first
day of December, one thousand nine hundred ninety-two, this
modification shall not be made for lottery prizes awarded by the
West Virginia state lottery commission;
(12) Any other income which this state is prohibited from
taxing under the laws of the United States.
(d)
Modification for West Virginia fiduciary adjustment. --
There shall be added to or subtracted from federal adjusted gross
income, as the case may be, the taxpayer's share, as beneficiary
of an estate or trust, of the West Virginia fiduciary adjustment
determined under section nineteen of this article.
(e)
Partners and S corporation shareholders. -- The amounts
of modifications required to be made under this section by a
partner or an S corporation shareholder, which relate to items of
income, gain, loss or deduction of a partnership or an S
corporation, shall be determined under section seventeen of this
article.
(f)
Husband and wife. -- If husband and wife determine their
federal income tax on a joint return but determine their West
Virginia income taxes separately, they shall determine their West
Virginia adjusted gross incomes separately as if their federal
adjusted gross incomes had been determined separately.
§11-21-77. Extension of withholding to certain lottery winnings.
(a)
Lottery winnings subject to withholding. -- Proceeds of
more than five thousand dollars from any lottery prize awarded by
the West Virginia state lottery commission shall be subject to
withholding. The West Virginia state lottery commission in
making any payment of a lottery prize subject to withholding
shall deduct and withhold from such payment a tax in an amount
equal to six and one-half percent of such payment.
(b)
Statement by recipient. -- Every person who is to
receive payment of winning which are subject to withholding shall
furnish the person making such payment a statement made under the
penalties of perjury, containing the name, address and taxpayer
identification number of the person receiving the payment and
each person entitled to any portion of such payment.
(c)
Coordination with other sections. -- For the purposes of
determining liability for payment of taxes and filing of returns,
payments of winnings which are subject to withholding shall be
treated as if they were wages paid by an employer to an employee.
ARTICLE 23. BUSINESS FRANCHISE TAX.
§11-23-9. Annual returns.
(a)
In general. -- Every person subject to the tax imposed
by this article shall make and file an annual return for the
taxable year with the tax commissioner on or before:
(1) The fifteenth day of the third month of the next
succeeding taxable year if the person is a corporation; or
(2) The fifteenth day of the fourth month of the next
succeeding taxable year if the person is a partnership.
The annual return shall include such information as the tax
commissioner may require for determining the amount of taxes due
under this article for the taxable year.
(b)
Special rule for tax exempt organizations with unrelated
business taxable income. -- Notwithstanding the provisions of
subsection (a) of this section, when a business franchise tax
return is required from an organization generally exempt from tax
under subsection (b), section seven of this article, which has
unrelated business taxable income, the annual return shall be
filed on or before the fifteenth day of the fifth month following
the close of the taxable year.
(c)
Consolidated returns. -- Any corporation that files as
part of an affiliated group for purposes of the tax imposed by
article twenty-four of this chapter shall file a consolidated
return under this article.
(d) The tax commissioner may, at his or her discretion,
require an affiliated group of corporations to file a
consolidated tax return under this article in order to accurately
determine the taxes due under this article.
(e)
Effective date. -- The amendments to this section made
in the year one thousand nine hundred ninety-three shall apply to
tax returns that become due after the first day of that year.
ARTICLE 24. CORPORATION NET INCOME TAX.
§11-24-6. Adjustments in determining West Virginia taxable
income.
(a)
General. -- In determining West Virginia taxable income
of a corporation, its taxable income as defined for federalincome tax purposes shall be adjusted and determined before the
apportionment provided by section seven of this article, by the
items specified in this section.
(b)
Adjustments increasing federal taxable income. -- There
shall be added to federal taxable income, unless already included
in the computation of federal taxable income, the following
items:
(1) Interest or dividends on obligations or securities of
any state or of a political subdivision or authority thereof;
(2) Interest or dividends (less related expenses to the
extent not deducted in determining federal taxable income) on
obligations or securities of any authority, commission or
instrumentality of the United States which the laws of the United
States exempt from federal income tax but not from state income
taxes;
(3) Income taxes and other taxes, including franchise and
excise taxes, which are based on, measured by, or computed with
reference to net income, imposed by this state or any other
taxing jurisdiction, to the extent deducted in determining
federal taxable income;
(4) The amount of unrelated business taxable income as
defined by Section 512 of the Internal Revenue Code of 1986, as
amended, of a corporation which by reason of its purposes is
generally exempt from federal income taxes; and
(5) The amount of any net operating loss deduction taken for
federal income tax purposes under Section 172 of the Internal
Revenue Code of 1986, as amended.
(c)
Adjustments decreasing federal taxable income. --
There
shall be subtracted from federal taxable income to the extent
included therein:
(1) Any gain from the sale or other disposition of property
having a higher fair market value on the first day of July, one
thousand nine hundred sixty-seven, than the adjusted basis at
said date for federal income tax purposes:
Provided, That the
amount of this adjustment is limited to that portion of any such
gain which does not exceed the difference between such fair
market value and such adjusted basis;
(2) The amount of any refund or credit for overpayment of
income taxes and other taxes, including franchise and excise
taxes, which are based on, measured by, or computed with
reference to net income, imposed by this state or any other
taxing jurisdiction, to the extent properly included in gross
income for federal income tax purposes;
(3) The amount added to federal taxable income due to the
elimination of the reserve method for computation of the bad debt
deduction;
(4) The full amount of interest expense actually disallowed
in determining federal taxable income which was incurred or
continued to purchase or carry obligations or securities of any
state or of any political subdivision thereof;
(5) The amount required to be added to federal taxable
income as a dividend received from a foreign (non-United States)
corporation under Section 78 of the Internal Revenue Code of
1986, as amended, by a corporation electing to take the foreigntax credit for federal income tax purposes;
(6) The amount of salary expenses disallowed as a deduction
for federal income tax purposes due to claiming the federal jobs
credit under Section 51 of the Internal Revenue Code of 1986, as
amended;
(7) The amount included in federal adjusted gross income by
the operation of Section 951 of the Internal Revenue Code of
1986, as amended; and
(8) Any amount included in federal adjusted gross income
which is foreign source income. Foreign source income includes:
(A) Interest and dividends, other than those derived from
sources within the United States;
(B) Rents, royalties, license and technical fees from
property located or services performed without the United States
or from any interest in such property, including rents, royalties
or fees for the use of or the privilege of using without the
United States any patents, copyrights, secret process and
formulas, good will, trademarks, trade brands, franchises and
other like properties; and
(C) Gains, profits or other income from the sale of
intangible or real property located without the United States.
In determining the source of "foreign source income", the
provisions of Sections 861, 862 and 863 of the Internal Revenue
Code of 1986, as amended, shall be applied.
(d)
Net operating loss deduction. -- Except as otherwise
provided in this subsection, there shall be allowed as a
deduction for the taxable year an amount equal to the aggregateof: (1) The West Virginia net operating loss carryovers to such
year; plus (2) the net operating loss carrybacks to such year:
Provided, That no more than three hundred thousand dollars of net
operating loss from any taxable year beginning after the
thirty-first day of December, one thousand nine hundred
ninety-two, may be carried back to any previous taxable year.
For purposes of this subsection, the term "West Virginia net
operating loss deduction" means the deduction allowed by this
subsection, determined in accordance with Section 172 of the
Internal Revenue Code of 1986, as amended.
(1)
Special rules. --
(A) When the corporation further adjusts its adjusted
federal taxable income under section seven of this article, the
West Virginia net operating loss deduction allowed by this
subsection shall be deducted after the section seven adjustments
are made;
(B) The tax commissioner shall prescribe such transition
regulations as he deems necessary for fair and equitable
administration of this subsection as amended by this act.
(2)
Effective date. -- The provisions of this subsection, as
amended by chapter one hundred nineteen, acts of the Legislature,
one thousand nine hundred eighty-eight, shall apply to all
taxable years ending after the thirtieth day of June, one
thousand nine hundred eighty-eight; and to all loss carryovers
from taxable years ending on or before said thirtieth day of
June.
(e)
Special adjustments for expenditures for water and airpollution control facilities. --
(1) If the taxpayer so elects under subdivision (2) of this
subsection, there shall be:
(A) Subtracted from federal taxable income the total of the
amounts paid or incurred during the taxable year for the
acquisition, construction or development within this state of
water pollution control facilities or air pollution control
facilities as defined in Section 169 of the Internal Revenue
Code; and
(B) Added to federal taxable income the total of the amounts
of any allowances for depreciation and amortization of such water
pollution control facilities or air pollution control facilities,
as so defined, to the extent deductible in determining federal
taxable income.
(2) The election referred to in subdivision (1) of this
subsection shall be made in the return filed within the time
prescribed by law (including extensions thereof) for the taxable
year in which such amounts were paid or incurred. Such election
shall be made in such manner, and the scope of application of
such election shall be defined, as the tax commissioner may by
regulations prescribe, and shall be irrevocable when made as to
all amounts paid or incurred for any particular water pollution
control facility or air pollution control facility.
(3) Notwithstanding any other provisions of this subsection
or of section seven to the contrary, if the taxpayer's federal
taxable income is subject to allocation and apportionment under
section seven, the adjustments prescribed in paragraphs (A) and(B), subdivision (1) of this subsection shall (instead of being
made to the taxpayer's federal taxable income before allocation
and apportionment thereof as provided in section seven) be made
to the portion of the taxpayer's net income, computed without
regard to such adjustments, allocated and apportioned to this
state in accordance with section seven.
(f)
Allowance for certain government obligations and
obligations secured by residential property. -- The West Virginia
taxable income of a taxpayer subject to this article as adjusted
in accordance with subsections (b), (c), (d) and (e) of this
section shall be further adjusted by multiplying such taxable
income after such adjustment by said subsections by a fraction
equal to one minus a fraction:
(1) The numerator of which is the sum of the average of the
monthly beginning and ending account balances during the taxable
year (account balances to be determined at cost in the same
manner that such obligations, investments and loans are reported
on Schedule L of the Federal Form 1120) of the following:
(A) Obligations or securities of the United States, or of
any agency, authority, commission or instrumentality of the
United States and any other corporation or entity created under
the authority of the United States Congress for the purpose of
implementing or furthering an objective of national policy;
(B) Obligations or securities of this state and any
political subdivision or authority thereof;
(C) Investments or loans primarily secured by mortgages, or
deeds of trust, on residential property located in this state andoccupied by nontransients; and
(D) Loans primarily secured by a lien or security agreement
on residential property in the form of a mobile home, modular
home or double-wide, located in this state and occupied by
nontransients;
(2) The denominator of which is the average of the monthly
beginning and ending account balances of the total assets of the
taxpayer which are shown on Schedule L of Federal Form 1120,
which are filed by the taxpayer with the Internal Revenue
Service.
§11-24-13. Returns; time for filing.
(a) On or before the fifteenth day of the third month
following the close of a taxable year, an income tax return under
this article shall be made and filed by or for every corporation
subject to the tax imposed by this article.
(b)
Special rule for tax exempt corporations with unrelated
business taxable income. -- Notwithstanding the provisions of
subsection (a) of this section, when an income tax return is
required from a corporation generally exempt from tax under
subsection (a), section five of this article, which has unrelated
business taxable income, the annual return shall be filed on or
before the fifteenth day of the fifth month following the close
of the taxable year.
(c) The tax commissioner may combine into one form the
annual return due under this article and the annual return due
under article twenty-three of this chapter. When a combined
business franchise tax and corporation net income tax annualreturn is filed by a taxpayer, the amount of tax remitted shall
be applied first against any business franchise tax that may be
due for the taxable year under said article and then against any
corporation net income tax that may be due for the taxable year.
The tax commissioner may also combine the forms for filing
declarations of estimated tax and the forms for making
installment payments of estimated tax.
(d)
Effective date. -- The amendments to this section made
in the year one thousand nine hundred ninety-three shall apply to
tax returns that become due after the first day of that year.
CHAPTER 16. PUBLIC HEALTH.
ARTICLE 9A. TOBACCO USAGE RESTRICTIONS.
§16-9A-6. Preemption.
Except as otherwise provided in this article, no state
agency, county, municipality or political subdivision or agency
of this state may impose any law, regulation, rule or requirement
of any sort relating to the use, sale or distribution of tobacco
products which is more restrictive than the provisions of this
article:
Provided, That any law, regulation, rule or requirement
duly enacted and in effect on the first day of January, one
thousand nine hundred ninety-three, shall remain in effect and
enforceable, but may not be amended to make it more restrictive
than it was on the first day of January, one thousand nine
hundred ninety-three.
CHAPTER 47. REGULATION OF TRADE.
ARTICLE 20. CHARITABLE BINGO.
§47-20-4. Annual license; conditions on holding of games.
A charitable or public service organization or any of its
auxiliaries or other organizations otherwise affiliated with it
may apply for an annual license. Only one license per year in
the aggregate may be granted to a charitable or public service
organization and all of its auxiliaries or other associations or
organizations otherwise affiliated with it:
Provided, That for
purposes of this section the various branches, chapters or lodges
of any national association or organization or local churches of
a nationally organized church are not considered affiliates or
auxiliaries of each other. The commissioner shall by regulation
provide for the manner for determining to which organization,
whether the parent organization, an affiliate or an auxiliary,
the one license allowed under this section is granted. An annual
license is valid for one year from the date of issuance and
entitles only the licensee to hold no more than two bingo
occasions per week. No two or more organizations may hold a
joint bingo occasion under any annual licenses. No bingo
occasion held pursuant to an annual license may exceed six hours
duration.
A licensee shall display its annual bingo license
conspicuously at the location where the bingo occasion is held.
All bingo occasions shall be open to the general public:
Provided, That no licensee shall permit or allow any individual
under the age of eighteen to participate in the playing of any
bingo game with knowledge or reason to believe that the
individual is under the age of eighteen:
Provided, however, That
an individual under the age of eighteen may attend the playing ofa bingo game when accompanied by and under the supervision of an
adult relative or a legal guardian of said individual.
§47-20-5. Limited occasion license; conditions on holding of
games.
A limited occasion license is valid only for the time period
specified in the application and entitles only the licensee to
hold a bingo occasion once every twenty-four hours for a time
period not to exceed two weeks. Two or more organizations may
hold a joint bingo occasion provided each participating
organization has been granted a limited occasion bingo license
for such jointly held occasion. No bingo occasion held pursuant
to a limited occasion license may exceed twelve hours in
duration. Each charitable or public service organization which
desires to hold bingo occasions pursuant to this section, or any
of its auxiliaries or other organizations otherwise affiliated
with it, shall obtain a limited occasion license notwithstanding
the fact that it holds a valid annual license:
Provided, That no
licensee which holds an annual license may obtain more than one
limited occasion license.
Only three limited occasion licenses per year in the
aggregate may be granted to a charitable or public service
organization and all of its auxiliaries or other associations or
organizations otherwise affiliated with it, none of which hold an
annual license. For purposes of this section, the various
branches, chapters or lodges of any national association or
organization or local churches of a nationally organized church
are not considered affiliates or auxiliaries of each other. Thecommissioner shall by regulation provide the manner for
determining to which organization, whether the parent
organization, an affiliate or an auxiliary, the three licenses
allowed under this section are granted.
A licensee shall display its limited occasion license
conspicuously at the location where the bingo occasion is held.
All bingo occasions shall be open to the general public:
Provided, That no licensee shall permit or allow any individual
under the age of eighteen to participate in the playing of any
bingo game with knowledge or reason to believe that the
individual is under the age of eighteen:
Provided, however, That
an individual under the age of eighteen may attend the playing of
a bingo game when accompanied by and under the supervision of an
adult relative or a legal guardian of said individual.
§47-20-6. License fee and exemption from taxes.
(a) A license fee shall be paid to the tax commissioner for
annual licenses in the amount of five hundred dollars, except
that for volunteer or nonprofit groups who gross less than twenty
thousand dollars the fee shall be two hundred dollars and for
bona fide senior citizen organizations the fee is fifty dollars.
A license fee shall be paid to the tax commissioner for a limited
occasion license in the amount of one hundred dollars. A license
fee of five hundred dollars shall be paid to the tax commissioner
for a state fair license as provided in section twenty-two of
this article. All revenue from said license fee shall be
deposited in the special revenue account established under the
authority of section two-a, article nine, chapter eleven of thiscode and used to support the investigatory activities provided
for in said section. The license fee imposed by this section is
in lieu of all other license or franchise taxes or fees of this
state and no county or municipality or other political
subdivision of this state is empowered to impose a license or
franchise tax or fee.
(b) The gross proceeds derived from the conduct of a bingo
occasion are exempt from state and local business and occupation
taxes, income taxes, excise taxes and all special taxes. The
licensee is exempt from payment of consumers sales and service
taxes and use taxes on all purchases for use or consumption in
the conduct of a bingo occasion and is exempt from collecting
consumers sales taxes on any admission fees and sales of bingo
cards:
Provided, That the exemption provided in this subsection
does not apply to state fair bingo proceeds.
§47-20-6a. Super bingo license.
Any charitable or public service organization may, upon
payment of a five thousand dollar license fee, apply to the tax
commissioner for issuance of an annual super bingo license. All
revenue from said license fee shall be deposited in the special
revenue account established under the authority of section two-a,
article nine, chapter eleven of this code and used to support the
investigatory activities provided for in said section. The tax
commissioner shall promulgate rules in accordance with article
three, chapter twenty-nine-a of this code specifying those
organizations which qualify as charitable or public service
organizations.
A holder of a super bingo license may conduct one super
bingo occasion each month during the period of the license at
which up to thirty thousand dollars in prizes may be awarded,
notwithstanding the seven thousand five hundred dollar limitation
on prizes specified in section ten of this article.
A charitable or public service organization that has a
regular or limited occasion bingo license may apply for a super
bingo license.
§47-20-12. Compensation.
Except as provided otherwise in sections twelve-a, thirteen
and twenty-two of this article, no individual who participates in
any manner in the conduct of a bingo occasion or the operation of
a concession in conjunction with a bingo occasion may receive or
accept any commission, wage, salary, reward, tip, donation,
gratuity or other form of compensation or remuneration whether
directly or indirectly, regardless of the source, for his work,
labor or services.
§47-20-12a. Compensation of bingo operator.
(a) Within the guidelines set forth in subsections (b), (c)
and (d) of this section, a licensee may pay a salary, not to
exceed the federal minimum wage, to operators of bingo games who
are active members of the licensee organization.
(b) If the licensee's gross receipts from bingo occasions
equal or exceed one hundred thousand dollars for the licensee's
most recently filed annual financial report, a salary may be paid
to not more than three operators.
(c) If the licensee's gross receipts from bingo occasionsare less than one hundred thousand dollars, but equal or exceed
fifty thousand dollars for the licensee's most recently filed
annual financial report, a salary may be paid to not more than
two operators.
(d) If the licensee's gross receipts from bingo occasions
are less than fifty thousand dollars for the licensee's most
recently filed annual financial report, a salary may be paid to
no more than one operator.
§47-20-15. Payment of reasonable expenses from proceeds; net
proceeds disbursement.
(a) The reasonable, necessary and actual expenses incurred
in connection with the conduct of bingo occasions, not to exceed
fifteen percent of the gross proceeds collected during a license
period, may be paid out of the gross proceeds of the conduct of
bingo, including, but not limited to:
(1) Rent paid for the use of the premises:
Provided, That
a copy of the rental agreement was filed with the bingo license
application and any changes thereto were filed within ten days of
being made;
(2) The cost of custodial services;
(3) The cost to the licensee organization for equipment and
supplies used to conduct the bingo occasion;
(4) The cost to the licensee organization for advertising
the bingo occasion;
(5) The cost of hiring security personnel, licensed pursuant
to the provisions of article eighteen, chapter thirty of this
code; and
(6) The cost of providing child care services to the raffle
patrons:
Provided, That any proceeds received from the provision
of child care services shall be handled the same as raffle
proceeds.
(b) The actual cost to the licensee for prizes, not to
exceed the amounts as specified in section ten of this article,
may be paid out of the gross proceeds of the conduct of bingo.
(c) The cost of any refreshments, souvenirs or any other
item sold or otherwise provided through any concession to the
patrons may not be paid for out of the gross proceeds from the
bingo occasion. The licensee shall expend all net bingo proceeds
and any interest earned thereon for the charitable or public
service purposes stated in the application within one year after
the expiration of the license under which the bingo occasions
were conducted. A licensee which does not qualify as a qualified
recipient organization may apply to the commissioner at the time
it applies for a bingo license or as provided in subsection (e)
of this section for permission to apply any or all of its net
proceeds to directly support a charitable or public service
activity or endeavor which it sponsors.
(d) No gross proceeds from any bingo operation may be
devoted or in any manner used by any licensee or qualified
recipient organization for the construction, acquisition,
improvement, maintenance or repair of real or personal property
except that which is used exclusively for one or more charitable
or public service purposes or as provided in subdivision (3),
subsection (a) of this section.
(e) Any licensee which, in good faith, finds itself unable
to comply with the requirements of this provision shall apply to
the commissioner for permission to expend its net proceeds for
one or more charitable or public service purposes other than that
stated in its license application or for permission to expend its
net proceeds later than the one-year time period specified in
this section. The application shall be on a form furnished by
the commissioner and shall include the particulars of the
requested changes and the reasons for the changes. The
application shall be filed no later than sixty days before the
end of the one-year period specified in this section. In the
case of an application to extend the time in which the net
proceeds are to be expended for a charitable or public service
purpose, the licensee shall file such periodic reports with the
commissioner as the commissioner directs until the proceeds are
so expended.
§47-20-16. Records; commissioner audit.
Any licensee which holds a bingo occasion as provided by
this article shall maintain a separate checking account and
separate bookkeeping procedure for its bingo operations. Money
for expenses shall be withdrawn only by checks having preprinted
consecutive numbers and made payable to a specific person, firm
or corporation and at no time shall a check be made payable to
cash. A licensee shall maintain all records required by this
article for at least three years and the records shall be open to
the commissioner for reasonable inspection. Whenever the tax
commissioner has reasonable cause to believe a licensee hasviolated any of the provisions of this article, he or she may
perform or cause to be performed an audit of the licensee's books
and records:
Provided, That the tax commissioner shall perform
or cause to be performed an audit of the books and records of any
licensee that has awarded total prizes in excess of one hundred
seventy-five thousand dollars. The tax commissioner shall file
a copy of the completed audit with the county commission of the
county wherein the licensee holds bingo occasions.
§47-20-24. Filing of reports.
Each licensee holding an annual license shall file with the
tax commissioner quarterly and an annual financial report
summarizing its bingo operations for the time period covered by
the report. Each quarterly report shall be filed within twenty
days after the end of the quarter which it covers. The annual
report shall be filed within thirty days after the expiration of
the license under which the operations covered by the report were
held.
Each licensee holding a limited occasion license or state
fair license shall file with the tax commissioner a financial
report summarizing its bingo operations for the license period
within thirty days after the expiration of the license under
which the operations covered by the report are held. The report
shall contain the name, address and social security number of any
individual who receives during the course of a bingo occasion
prizes the aggregate value of which exceeds one hundred dollars,
and other information required by the commissioner:
Provided,
That any licensee failing to file such report when due shall beliable for a penalty of twenty-five dollars for each month or
fraction thereof during which the failure continues, such penalty
not to exceed one hundred dollars:
Provided, however, That
annual financial reports for license years ending after the first
day of July, one thousand nine hundred ninety-three, must be
audited financial reports as defined by the American institute of
certified public accountants if a licensee's gross receipts
exceed one hundred thousand dollars:
Provided further, That
annual financial reports for license years ending after the first
day of July, one thousand nine hundred ninety-three, must contain
a compilation and review of such financial report, as defined by
the American institute of certified public accountants, if a
licensee's gross receipts exceed fifty thousand dollars but are
less than one hundred thousand dollars.
§47-20-28a. Certain operators of bingo games to provide for
smoking and nonsmoking sections.
Any bingo operator who distributes more than one hundred
bingo cards or bingo sheets at any bingo occasion shall provide
a smoking and nonsmoking section, if smoking is permitted.
ARTICLE 21. CHARITABLE RAFFLES.
§47-21-7. License fee and exemption from taxes.
(a) A license fee shall be paid to the tax commissioner for
annual licenses in the amount of five hundred dollars. A license
fee shall be paid to the tax commissioner for a limited occasion
license in the amount of fifty dollars. All revenue from said
license fee shall be deposited in the special revenue account
established under the authority of section two-a, article nine,chapter eleven of this code and used to support the investigatory
activities provided for in said section. The license fee imposed
by this section is in lieu of all other license or franchise
taxes or fees of this state and no county or municipality or
other political subdivision of this state is empowered to impose
a license or franchise tax or fee on any raffle or raffle
occasion.
(b) The gross proceeds derived from the conduct of a raffle
occasion are exempt from state and local business and occupation
taxes, income taxes, excise taxes and all special taxes. Any
charitable or public service organization conducting a raffle
occasion pursuant to the provisions of this article is exempt
from payment of consumers sales and service taxes, use taxes and
all other taxes on all purchases for use or consumption in the
conduct of a raffle occasion and is exempt from collecting
consumers sales taxes on any admission fees and sales of raffle
tickets.
§47-21-15. Payment of reasonable expenses from proceeds; net
proceeds disbursement.
(a) The reasonable, necessary and actual expenses incurred
in connection with the conduct of raffle occasions, not to exceed
fifteen percent of the gross proceeds collected during a license
period, may be paid out of the gross proceeds of the conduct of
raffle, including, but not limited to:
(1) Rent paid for the use of the premises:
Provided, That
a copy of the rental agreement was filed with the raffle license
application with any modifications thereto to be filed within tendays of being made;
(2) The cost of custodial services;
(3) The cost to the licensee organization for equipment and
supplies used to conduct the raffle occasion;
(4) The cost to the licensee organization for advertising
the raffle occasion;
(5) The cost of hiring security personnel, licensed pursuant
to the provisions of article eighteen, chapter thirty of this
code; and
(6) The cost of providing child care services to the bingo
patrons:
Provided, That any proceeds received from the provision
of child care services shall be handled the same as bingo
proceeds.
(b) The actual cost to the licensee for prizes, not to
exceed the amounts as specified in section eleven of this
article, may be paid out of the gross proceeds of the conduct of
raffle.
(c) The cost of any refreshments, souvenirs or any other
item sold or otherwise provided through any concession to the
patrons may not be paid for out of the gross proceeds from the
raffle occasion. The licensee shall expend all net raffle
proceeds and any interest earned thereon for the charitable or
public service purposes stated in the application within one year
after the expiration of the license under which the raffle
occasions were conducted. A licensee which does not qualify as
a qualified recipient organization may apply to the commissioner
at the time it applies for a raffle license or as provided insubsection (e) of this section for permission to apply any or all
of its net proceeds to directly support a charitable or public
service activity or endeavor which it sponsors.
(d) No gross proceeds from any raffle operation may be
devoted or in any manner used by any licensee or qualified
recipient organization for the construction, acquisition,
improvement, maintenance or repair of real or personal property
except that which is used exclusively for one or more charitable
or public service purposes or as provided in subdivision (3),
subsection (a) of this section.
(e) Any licensee which, in good faith, finds itself unable
to comply with the requirements of the foregoing provisions of
this section shall apply to the commissioner for permission to
expend its net proceeds for one or more charitable or public
service purposes other than that stated in its license
application or for permission to expend its net proceeds later
than the one-year time period specified in this section. The
application shall be on a form furnished by the commissioner and
shall include the particulars of the requested changes and the
reasons for the changes. The application shall be filed no later
than sixty days before the end of the one-year period specified
in this section. In the case of an application to extend the
time in which the net proceeds are to be expended for a
charitable or public service purpose, the licensee shall file
such periodic reports with the commissioner as the commissioner
directs until the proceeds are so expended.
§47-21-22. Filing of reports.
Each licensee holding an annual, limited or state fair
license shall file with the commissioner a financial report
summarizing its raffle operations within thirty days after the
expiration date of such license.
The reports required by this section shall contain the name,
address and social security number of any individual who received
during the course of a raffle occasion prizes the aggregate value
of which exceeded one hundred dollars, and other information
required by the commissioner:
Provided, That any licensee failing
to file such report when due shall be liable for a penalty of
twenty-five dollars for each month or fraction thereof during
which the failure continues, such penalty not to exceed one
hundred dollars:
Provided, however, That annual financial reports
for license years ending after the first day of July, one
thousand nine hundred ninety-three, must be audited financial
reports as defined by the American institute of certified public
accountants if a licensee's gross receipts exceed one hundred
thousand dollars:
Provided further, That annual financial reports
for license years ending after the first day of July, one
thousand nine hundred ninety-three, must contain a compilation
and review of such financial report, as defined by the American
institute of certified public accountants, if a licensee's gross
receipts exceed fifty thousand dollars but are less than one
hundred thousand dollars.
ARTICLE 23. CHARITABLE RAFFLE BOARDS AND GAMES.
§47-23-1. Short title.
This article shall be known as and may be cited as the"Charitable Raffle Boards and Games Act".
§47-23-2. Definitions.
For purposes of this article, unless specified otherwise:
(a) "Commissioner" means tax commissioner of the state of
West Virginia, or his delegate.
(b) "Retail face value" means the projected gross income to
be received by the retailer from the sale of all raffle chances
on or in the charitable raffle boards or games.
(c) "Indicia" means the impression authorized by the
commissioner to serve as such indicia, and shall be of the design
and color prescribed by the commissioner.
(d) "Person" means any individual, association, society,
incorporated or unincorporated organization, firm partnership or
other nongovernmental entity or institution.
(e) "Retailer" means every person engaged in the business of
making retail sales of raffle chances.
(f) "Charitable raffle board" or "charitable raffle game"
means a board or other device that has many folded printed slips
to be pulled from the board or otherwise distributed without a
board on payment of a nominal sum in an effort to obtain a slip
or chance that entitles the player to a designated prize:
Provided, That a "charitable raffle board" or "charitable raffle
game" shall not include the sale, by an elementary or secondary
school, parent-teacher organization of an elementary or secondary
school, youth organization, such as the girl scouts of America or
the boy scouts of America, or any political party executive
committee, of chances in an effort, by the person purchasing thechance, to obtain a designated prize:
Provided, however, That
the aggregate value of all such prizes in any given calendar year
shall not exceed three thousand five hundred dollars.
(g) "Sale" means the transfer of the ownership of tangible
personal property for a consideration.
(h) "Wholesaler" or "distributor" means any person or entity
engaged in the wholesale distribution of charitable raffle boards
or games or similar boards or devices, as defined by the
commissioner, and licensed under the provisions of this article,
to distribute said devices to charitable raffle boards or games
retailers as defined in this article. It also includes anyone
who is engaged in the manufacturing, packaging, preparing or
repackaging of charitable raffle boards or games for distribution
in this state.
§47-23-3. License fee.
Wholesalers or distributors of charitable raffle boards and
games to retailers shall be licensed and a license fee in the
amount of five hundred dollars shall be paid to the commissioner
by each wholesaler or distributor for an annual license.
Wholesalers shall also pay a fee of six cents on each dollar of
retail value of each charitable raffle board or game sold to a
retailer. There is hereby imposed an excise tax of six percent
of the winnings on any charitable raffle boards and games. The
tax shall be collected and remitted to the tax commissioner on a
monthly basis by the holder of the raffle game. All revenue from
said fee shall be placed in the special revenue account
established under the authority of section two-a, article nine,chapter eleven of this code.
§47-23-4. No fee on charitable raffle boards and games by
municipalities or other governmental subdivisions.
No municipality or governmental subdivision shall levy any
excise or other tax or fee requiring charitable raffle boards or
games to be stamped, or requiring licenses for sale thereof,
other than licenses which may be imposed as a result of licenses
provided for in article twelve, chapter eleven of this code.
§47-23-5. Indicia; how affixed; violations.
The indicia required by this article, as described in the
charitable raffle boards and games fee rules and regulations,
shall be impressed upon each charitable raffle board or game, of
an aggregate value of not less than the amount of the fee
imposed. The indicia so impressed shall be prima facie evidence
of payment of the annual license fee imposed by this article.
Indicia printing approval shall be received from only the
commissioner by wholesalers and distributors who have paid the
annual license fee provided in section three of this article.
Except as may be otherwise provided in the rules and
regulations prescribed by the commissioner under authority of
this article, such indicia shall be impressed by each wholesaler
or distributor prior to the sale of such boards or games to a
retailer. Each wholesaler or distributor making such sales must
be authorized to do business in this state prior to the sale or
delivery of any charitable raffle boards or games to any retailer
in this state.
Whenever any charitable raffle boards or games are found inthe place of business of any retailer without the indicia so
impressed, the prima facie presumption shall arise that such
charitable raffle boards or games are kept therein in violation
of the provisions of this article.
§47-23-6. Form of indicia; custody; security for payments.
The commissioner shall design the indicia to be used as
herein provided for impression on charitable raffle boards or
games. The charitable raffle boards or games shall have the
purchase price clearly imprinted thereon and shall have printed
or impressed thereon the words "State of West Virginia -- Raffle
Board Stamp" or such other words and figures as the commissioner
may deem proper.
§47-23-7. Surety bonds required; release of surety; new bond.
The commissioner may require wholesalers and distributors to
file continuous surety bond in an amount to be fixed by the
commissioner except that the amount shall not be less than one
thousand dollars. Upon completion of the filing of a surety bond
an annual notice of renewal, only, shall be required thereafter.
The surety must be authorized to engage in business within this
state. The bond shall be conditioned upon faithfully complying
with the provisions of this article including the filing of the
returns and payment of all fees prescribed by this article.
Any surety on a bond furnished hereunder shall be released
and discharged from all liability accruing on such bond after the
expiration of sixty days from the date the surety shall have
lodged, by certified mail, with the tax commissioner a written
request to be discharged. This shall not relieve, release ordischarge the surety from liability already accrued or which
shall accrue before the expiration of the sixty-day period.
Whenever any surety shall seek release as herein provided, it
shall be the duty of the wholesaler or distributor to supply the
commissioner with another bond.
§47-23-8. How fee paid; reports required; due date; records to
be kept; inspection of records and stocks; examination of
witnesses, summons, etc.
The fee hereby imposed shall be paid by each licensed
wholesaler or distributor to the commissioner on or before the
fifteenth day of April, July, October and January for the
preceding three calendar months. The measure of the fee shall be
determined by multiplying the total amount of the retail face
value of all charitable raffle boards and games sold by
wholesalers or distributors to retailers during the said
three-month period by six percent. All fees due and owing to the
commissioner by reason of this article, if paid after the due
dates required by this section, shall be subject to the
provisions of article ten, chapter eleven of this code. Each
wholesaler or distributor shall provide with each quarterly
payment of fees a report covering the business transacted in the
previous three calendar months and providing such other
information as the commissioner may deem necessary for the
ascertainment or assessment of the fee imposed by this article.
Such report shall be signed under penalty of perjury on such
forms as the tax commissioner may prescribe and the wholesaler or
distributor shall at the time of filing remit all fees owed ordue.
The commissioner may authorize any wholesaler or distributor
holding the license required by this article to use any metering
device approved by the commissioner, such devices to be sealed by
the commissioner, before being used, which device shall be used
only in accordance with the regulations prescribed by the
commissioner. A wholesaler or distributor shall pay the fee in
advance where a metering device is used, in which event such
wholesaler or distributor shall deliver the metering device to
the commissioner who shall seal the meter in accordance with the
prepayment so made.
The reports prescribed herein are required, although a fee
might not be due or no business transacted for the period covered
by the report.
Each person required to file a report under this article
shall make and keep such records as shall be prescribed by the
commissioner that are necessary to substantiate the returns
required by this article, including, but not limited to,
inventories, receipts, disbursements and sales, for a period of
time not less than three years.
Unless otherwise permitted, in writing, by authority of the
commissioner, each delivery ticket or invoice for each purchase
or sale of charitable raffle boards or games must be recorded
upon a serially numbered invoice showing the name and address of
the seller and the purchaser, the point of delivery, the date,
quantity and price of the product sold, and the fee must be set
out separately, and such other reasonable information as thecommissioner may require. These invoicing requirements also
apply to cash sales and a person making such sales must maintain
such records as may be reasonably necessary to substantiate his
return.
In addition to the commissioner's powers set forth in
section five, article ten, chapter eleven of this code, the
commissioner shall have authority to inspect or examine the stock
of charitable raffle boards and games kept in and upon the
premises of any person where charitable raffle boards and games
are placed, stored or sold, and he shall have authority to
inspect or examine the records, books, papers and any equipment
or records of manufacturers, wholesalers and distributors or any
other person for the purpose of determining the quantity of
charitable raffle boards and games acquired or disbursed to
verify the truth and accuracy of any statement or report and to
ascertain whether the fee imposed by this article has been
properly paid.
In addition to the commissioner's powers set forth in
section five, article ten, chapter eleven of this code, and as a
further means of obtaining the records, books and papers of a
manufacturer, wholesaler, distributor or any other person and
ascertaining the amount of fees and reports due under this
article, the commissioner shall have the power to examine
witnesses under oath; and if the witness shall fail or refuse at
the request of the commissioner to grant access to the books,
records or papers, the commissioner shall certify the facts and
names to the circuit court of the county having jurisdiction ofthe party and such court shall thereupon issue summons to such
party to appear before the commissioner, at a place designated
within the jurisdiction of such court, on a day fixed, to be
continued as the occasion may require for good cause shown and
give such evidence and lay open for inspection such books and
papers as may be required for the purpose of ascertaining the
amount of fee and reports due, if any.
§47-23-9. Penalty for failure to file return when no fee due;
crimes.
(a)
Penalty for failure to file required return where no fee
due. -- In the case of any failure to make or file a return when
no fee is due, as required by this article, on the date
prescribed therefor, unless it be shown that such failure was due
to reasonable cause and not due to willful neglect, there shall
be collected a penalty of twenty-five dollars for each month of
such failure or fraction thereof.
(b) It shall be a misdemeanor, punishable pursuant to the
terms of this article, if any person:
(1) Makes any false entry upon an invoice required to be
made under the provisions of this article or with intent to evade
the fee imposed by this article presents any such false entry for
the inspection of the commissioner;
(2) Prevents or hinders the commissioner from making a full
inspection of any place where charitable raffle boards or games
subject to the fee imposed by this state are sold or stored or
prevents or hinders the full inspection of invoices, books,
records or papers required to be kept under the provisions ofthis article;
(3) Sells any charitable raffle boards or games in this
state without there having been first affixed thereto the indicia
required by this article;
(4) Being a retailer in this state, has in his possession
any charitable raffle boards or games not bearing the indicia
herein required to be affixed thereto or, whoever fails to
produce on demand by the commissioner invoices of all charitable
raffle boards and games purchased or received by him within three
years prior to such demand, unless upon satisfactory proof it is
shown that such nonproduction is due to providential or other
causes beyond his control;
(5) Being a retailer in this state, purchases or acquires
charitable raffle boards and games from any person other than a
wholesaler or distributor licensed under this article; or
(6) Who is not a wholesaler or distributor of charitable
raffle boards or games, as provided by this article, shall have
in his possession within the state any charitable raffle boards
or games not bearing the proper indicia of this state, such
possession shall be inferred to be for the purpose of evading the
payment of the fees imposed or due thereon.
(c) Any person convicted of violating the provisions of
subsection (b) of this section shall be confined in the county
jail for not less than one year or fined not less than one
thousand dollars nor more than ten thousand dollars, or both
fined and imprisoned.
(d) Any person who falsely or fraudulently makes, forges,alters or counterfeits any indicia prescribed, or defined, by the
provisions of this article, or its related rules and regulations,
or who knowingly and willfully makes, causes to be made,
purchases, receives or has in his possession, any device for
forging or counterfeiting any indicia, or has in his possession,
any indicia not properly issued by the commissioner or tampers
with or alters any stamping device authorized by the
commissioner, or uses more than once any indicia provided for and
required by this article for the purpose of evading the fee
hereby imposed, shall be guilty of a felony, and, upon conviction
thereof, shall be sentenced to pay a fine of not less than five
thousand dollars nor more than ten thousand dollars or imprisoned
in the penitentiary for a term of not less than one year nor more
than five years, or both fined and imprisoned.
(e) Whenever the commissioner, or any of his deputies or
employees authorized by him, or any peace officer of this state
shall discover any charitable raffle boards or games subject to
the fee as provided by this article and upon which the fee has
not been paid as herein required, such charitable raffle boards
and games shall thereupon be deemed to be contraband, and the
commissioner, or such deputy or employee or any peace officer of
this state, is hereby authorized and empowered forthwith to seize
and take possession of such charitable raffle boards or games,
without a warrant, and such charitable raffle boards and games
shall be forfeited to the state, and the commissioner shall
retain the forfeited charitable raffle boards and games until
they are no longer needed as evidence in any prosecution of theperson from whom the raffle boards and games were seized. The
commissioner may within a reasonable time thereafter destroy such
charitable raffle boards and games or may affix the indicia
required by this article upon each charitable raffle board or
game and sell said charitable raffle boards or games at public
auction to the highest bidder:
Provided, That such seizure and
destruction or public auction shall not be deemed to relieve any
person from fine or imprisonment as provided herein for violation
of any provisions of this article. Such destruction may be made
in any county the commissioner deems most convenient and
economical. All revenue from said license fee shall be deposited
in the special revenue account established under the authority of
section two-a, article nine, chapter eleven of this code and used
to support the investigatory activities provided for in said
section.
(f) Magistrates shall have concurrent jurisdiction with any
other courts having jurisdiction for the trial of all
misdemeanors arising under this article.
§47-23-10. Transportation of unstamped charitable raffle boards
and games; forfeitures and sales of charitable raffle
boards, charitable raffle games and equipment; criminal
sanctions.
Every person who shall knowingly transport charitable raffle
boards or games not bearing indicia as required by section six of
this article upon the public highways, waterways, airways, roads
or streets of this state shall have in his actual possession
invoices or delivery tickets for such charitable raffle boards orgames which shall show the true name and the complete and exact
address of the manufacturer, the true name and complete and exact
address of the wholesaler or distributor who is the purchaser,
the quantity and description of the charitable raffle boards and
games transported and the true name and complete and exact
address of the person who has or shall assume payment of the West
Virginia state fee, or the tax, if any, of the state or foreign
country at the point of ultimate destination:
Provided, That any
common carrier which has issued a bill of lading for a shipment
of charitable raffle boards and games and is without notice to
itself or to any of its agents or employees that said charitable
raffle boards or games have no proper indicia affixed thereto as
required by section six of this article shall be deemed to have
complied with this article and the vehicle or vessel in which
said charitable raffle boards or games are being transported
shall not be subject to confiscation hereunder. In the absence
of such invoices, delivery tickets or bills of lading, as the
case may be, the charitable raffle boards or games so
transported, the vehicle or vessel in which the charitable raffle
boards or games are being transported and any paraphernalia or
devices used in connection with such, are declared to be
contraband goods and may be seized by the commissioner, his
agents or employees or by any peace officer of the state without
a warrant.
Any person who transports charitable raffle boards or games
in violation of this section shall be guilty of a misdemeanor,
and, upon conviction thereof, shall be fined not less than threehundred dollars nor more than five thousand dollars, or
imprisoned in the county jail not more than one year, or both
fined and imprisoned.
Charitable raffle boards and games seized under this section
shall be forthwith destroyed in the manner provided hereinafter
in this section and such destruction shall not relieve the owner
of the destroyed charitable raffle boards and games of any action
by the commissioner for violations of this or any other sections
of this article.
The commissioner shall immediately, after any seizure made
pursuant to this section, institute a proceeding for the
confiscation thereof in the circuit court of the county in which
the seizure is made. The court may proceed in a summary manner
and may direct confiscation by the commissioner:
Provided, That
any person claiming to be the holder of a security interest in
any vehicle or vessel, the disposition of which is provided for
above, may present his petition so alleging and be heard, and in
the event it appears to the court that the property was
unlawfully used by a person other than such claimant, and if the
said claimant acquired his security interest in good faith and
without knowledge that the vehicle or vessel was going to be so
used, the court shall waive forfeiture in favor of such claimant
and order the vehicle or vessel returned to such claimant.
§47-23-11. Administration; rules.
(a) The commissioner shall promulgate rules to administer
the provisions of this article in accordance with the provisions
of chapter twenty-nine-a of this code. Additionally, thecommissioner shall promulgate a rule which sets forth a means of
verifying on the face of every charitable raffle board or game
that the charitable raffle board or game is distributed by a
wholesaler licensed pursuant to the provisions of this article.
(b) The commissioner shall deny an application for a license
if he finds that the issuance thereof would be in violation of
the provisions of this article.
(c) The commissioner may suspend, revoke or refuse to renew
any license issued hereunder for a material failure to maintain
the records or file the reports required by this article or
administrative rule if the commissioner finds that said failure
will substantially impair the commissioner's ability to
administer the provisions of this article with regard to said
licensee.
(d) The burden of proof in any administrative or court
proceeding is on the applicant to show cause why a charitable
raffle boards or games wholesaler's or distributor's license
should be issued or renewed and on the licensee to show cause why
its license should not be revoked or suspended.
§47-23-12. Severability.
If any provision of this article or the application thereof
shall for any reason be adjudged by any court of competent
jurisdiction to be invalid, such judgment shall not affect,
impair or invalidate the remainder of said article, but shall be
confined in its operation to the provision thereof directly
involved in the controversy in which such judgment shall have
been rendered and the applicability of such provision to otherpersons or circumstances shall not be affected thereby.
§47-23-13. General procedure and administration.
Each and every provision of the "West Virginia Tax Procedure
and Administration Act" set forth in article ten, chapter eleven
of this code shall apply to the fees imposed by this article with
like effect as if said act were applicable only to the fees
imposed by this article and were set forth in extenso in this
article.
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