WEST virginia legislature

2017 regular session

Introduced

House Bill 3044

By Delegates Longstreth (By Request), Bates, Fleischauer, Lane, Miller, R., Baldwin, Byrd, Hamilton and Hornbuckle

[Introduced March 14, 2017; Referred
to the Committee on Finance]

A BILL to amend and reenact §11-19-1 and §11-19-2 of the Code of West Virginia, 1931, as amended, all relating to the tax on soft drinks; increasing the tax; modifying what drinks are covered by the tax; and providing an effective date.

Be it enacted by the Legislature of West Virginia:

That §11-19-1 and §11-19-2 of the Code of West Virginia, 1931, as amended, be amended and reenacted, all to read as follows:

ARTICLE 19. SOFT DRINKS TAX.

§11-19-1. Definitions.

As used in this article:

(1) "Bottled soft drinks" shall include any and all nonalcoholic beverages, whether carbonated or not, such as soda water, ginger ale, coca cola, lime cola, pepsi cola, doctor pepper, root beer, carbonated water, orangeade, lemonade, fruit juice when any plain or carbonated water, flavoring or syrup is added, or any and all preparations commonly referred to as "soft drinks" of whatever kind which are intended for human consumption and contain any added caloric sweetener which are intended for human consumption and contain any added caloric sweetener, which are closed and sealed in glass, paper, or any other type of container, envelope, package or bottle, whether manufactured with or without the use of any syrup. The term "bottled soft drinks" shall not include beverages sweetened solely with noncaloric sweeteners; water, carbonated or not, to which no caloric sweetener has been added; fluid milk to which no flavoring has been added, or natural undiluted fruit juice or vegetable juice.

(2) "Natural undiluted fruit juice" shall means the original liquid resulting from the pressing of fruit with or without sweetener being added, or the liquid resulting from the reconstitution of natural fruit juice concentrate by the restoration of water to dehydrated natural fruit juice. with or without sweetener being added

(3) "Natural undiluted vegetable juice" shall means the original liquid resulting from the pressing of vegetables with or without sweetener being added or the liquid resulting from the reconstitution of natural vegetable juice concentrate by the restoration of water to dehydrated natural vegetable juice. with or without sweetener being added

(4) "Sweetener" shall means sugar only, artificial or natural, which singularly flavors the taste of a natural undiluted fruit juice or natural undiluted vegetable juice.

(5) "Soft drink syrups and powders" shall includes the compound mixture or the basic ingredients, whether dry or liquid, practically and commercially usable in making, mixing or compounding soft drinks by the mixing thereof with one or more other ingredients, including without limitation, carbonated or plain water, ice, fruit, milk or any other product suitable to make a soft drink, among such syrups being such products as coca cola syrup, chero cola syrup, pepsi cola syrup, doctor pepper syrup, root beer syrup, nu-grape syrup, lemon syrup, vanilla syrup, chocolate syrup, cherry smash syrup, rock candy syrup, simple syrup, chocolate drink powder, malt drink powder, or any other prepared syrups or powders sold or used for the purpose of mixing soft drinks commercially at soda fountains, restaurants or similar places as well as those syrups and powder bases prepared for the purpose of domestically mixing soft drinks such as kool aid, oh boy drink, tip top, miracle aid and all other similar products.

(6) "Simple syrup" shall mean the making, mixing, compounding or manufacturing, by dissolving sugar and water or any other mixtures that will create simple syrup to which may or may not be added concentrates or extracts.

(7) (6) "Person" shall means and include an individual, firm, partnership, association or corporation, or any other legal entity.

(8) (7) "Wholesale dealer" includes only those persons who sell any bottled soft drink or soft drink syrup to retail dealers for the purpose of resale.

(9) (8) "Retail dealer" includes every person other than a wholesale dealer mixing, making, compounding or manufacturing who sells or otherwise dispenses bottle soft drinks, or mixes, makes, compounds, or manufactures any drink from a soft drink syrup or powder base, or a person selling such syrup or powder.

(10) (9) "Distributor" shall means any person who receives, stores, manufactures, bottles, produces, distributes, purchases or both distributes and purchases for sale to retail dealers any bottled soft drink or soft drink syrup or powder, whether or not that person also sells such products to consumers.

(11) (10) "Commissioner" means the State Tax Commissioner, and where the meaning of the context requires, all deputies and employees duly authorized by him or her.

§11-19-2. Excise tax on bottled soft drinks, syrups and dry mixtures powders; disposition thereof.

(a) For the purpose of providing revenue for the construction, maintenance and operation of a four-year school of medicine, dentistry and nursing of in West Virginia University, an excise tax is hereby levied and imposed on and after midnight of June 30, 1951, upon the sale, use, handling or distribution of all bottled soft drinks and all soft drink syrups and powders, whether manufactured within or without this state. as follows:

(1) On each bottled soft drink, a tax of 1¢ on each sixteen and nine-tenths fluid ounces, or fraction thereof, or on each one-half liter, or fraction thereof contained therein.

(2) On each gallon of soft drink syrup, a tax of 80¢, and in like ratio on each part gallon thereof, or on each four liters of soft drink syrup a tax of 84¢, and in like ratio on each part four liters thereof.

(3) On each ounce by weight of dry mixture or fraction thereof used for making soft drinks, a tax of 1¢ or on each 28.35 grams, or fraction thereof, a tax of 1¢

(b) Effective July 1, 2017, bottled soft drinks and soft drink syrups and powders shall be taxed as follows:

(1) Bottled soft drinks shall be taxed at a rate of 1¢ per fluid ounce.

(2) Soft drink syrups and powders shall be taxed at a rate of 1¢ per ounce of soft drink produced from that syrup or powder. For purposes of calculating the tax, the volume of soft drink produced from syrups or powders shall be the larger of:

(A) The largest volume resulting from use of the syrups or powders per any manufacturer’s instructions; or

(B) The volume actually produced by the retail dealer, as reasonably determined by the commissioner.

(c) Any person manufacturing or producing within this state any bottled soft drink or soft drink syrup for sale within this state and any distributor, wholesale dealer or retail dealer or any other person who is the original consignee of any bottled soft drink or soft drink syrup manufactured or produced outside this state, or who brings such drinks or syrups into this state, shall be is liable for the excise tax hereby imposed. The excise tax hereby imposed shall may not be collected more than once in respect to any bottled soft drink or soft drink syrup manufactured, sold, used or distributed in this state.

(d)  All The first  $15 million of the revenue collected by the commissioner under the provisions of this article, less such costs of administration as are hereinafter provided for, shall be paid by him or her into a special medical school fund, which is hereby created in the State Treasury, to be used solely for the construction, maintenance and operation of a four-year school of medicine, dentistry and nursing, as otherwise provided by law and the remainder of the revenue collected shall be deposited in the General Revenue Fund of the state.

NOTE: The purpose of this bill is to change the structure of the tax on bottled soft drinks and soft drink syrups and powders to only cover soft drinks with added caloric sweeteners, increase the rate to one cent per ounce and directing the excess proceeds into the state General Revenue Fund.

Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.