Tax Type
BPOL Tax
Description
Taxpayer was established after the dissolution of Interstate Commerce Commission
Topic
Exemptions
Local Taxes Discussion
Statute of Limitations
Date Issued
06-24-2014
June 24, 2014
Re: Request for Advisory Opinion
Business, Professional and Occupational License (BPOL) Tax
Dear *****:
This is in response to your letter in which the ***** (the "Town") requests an advisory opinion as to whether a common carrier is exempt from the Business, Professional and Occupational License (BPOL) tax.
The local license fee and tax are imposed and administered by local officials. Virginia Code § 58.1-3701 authorizes the Department to issue advisory opinions on local license tax issues. The following opinion has been made subject to the facts presented to the Department summarized below. Any change in facts or the introduction of new facts may lead to a different result.
The Code of Virginia sections, regulation and public documents cited are available on-line at www.tax.virginia.gov in the Laws, Rules and Decisions section of the Department's web site.
FACTS
An enterprise (the "Taxpayer") with a definite place of business in the Town operates as a common carrier. The Taxpayer is registered with the Federal Motor Carrier Safety Administration (FMCSA) for insurance purposes. The Town requests an advisory opinion as to whether the Taxpayer qualifies for the exemption provided by Va. Code § 58.1-3703 C 1.
OPINION
Virginia Code § 58.1-3703 C 1 provides an exemption from BPOL taxation to "any public service corporation or any motor carrier, common carrier, or other carrier of passengers or property formerly certified by the Interstate Commerce Commission or presently registered for insurance purposes with the Surface Transportation Board of the United States Department of Transportation, Federal Highway Administration . . .".
By reason of their character as legislative grants, statutes relating to exemptions allowed against a tax liability must be strictly construed against the taxpayer and in favor of the taxing authority. See DKM Richmond Associates, L.P. v. City of Richmond, 249 Va. 401, 457 S.E.2d 76 (1995). As such, any taxpayer seeking to claim the exemption afforded by Va. Code § 58.1-3703 C 1 must meet the exemption's specific requirements.
Established on January 1, 2000, one of the functions of FMSCA was to take over the registration process for proof of insurance from the STB. See 49 C.F.R. § 387.7. Accordingly, public service corporations, motor carriers, common carriers, or other carrier of passengers or property no longer register for insurance purposes with the STB. Consequently, the only way a public service corporation or any motor carrier, common carrier, or other carrier of passengers or property can qualify for the exemption under Va. Code § 58.1-3703 C 1 as currently drafted is if they were formerly certified by the Interstate Commerce Commission (ICC).
The ICC was abolished in 1995. If the Taxpayer was established after the dissolution of the ICC, it could not have been certified by the ICC and would not qualify for the exemption provided by Va. Code § 58.1-3703 C 1.
If you have any questions regarding this response, you may contact ***** in the Office of Tax Policy, Appeals and Rulings, at *****.
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- Sincerely,
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Craig M. Burns
Tax Commissioner
AR/1-5627409908.B
Rulings of the Tax Commissioner