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Litter Tax

• Who is Subject to the Tax
• Return and Due Date For Filing
• Tax Rates
• Penalty
• Interest
• Application of the Tax

Who is Subject to the Tax

Every manufacturer, wholesaler, distributor or retailer of the following products is subject to the tax. Businesses become subject to the tax on the first January 1 they are in business. For example, if you begin business on February 15, 2008, you become liable for the tax on January 1, 2009 and your first return will be due on May 1, 2010. If you begin business on January 1, 2008 you are liable on January 1, 2008 and your first return is due May 1, 2009.

1. Food for human or pet consumption
2. Groceries
3. Cigarettes and Tobacco
4. Soft Drinks and Carbonated waters
5. Beer and Other Malt Beverages
6. Wine
7. Newspaper or Magazines
8. Paper Products and Household Paper
9. Glass Containers
10. Metal Containers
11. Plastic or Fiber Containers made of Synthetic Material
12. Cleaning Agents and Toiletries
13. Nondrug Drugstore Sundries
14. Distilled Spirits
15. Motor Vehicle Parts

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Return and Due Date For Filing

Litter tax returns are filed on Form 200. Form 200 must be filed by May 1 of each year. There is no provision for extension. The filing address is:

Department of Taxation
Post Office Box 405
Richmond, Virginia 23218-0405

Make checks payable to "Virginia Department of Taxation."

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Tax Rates

The tax is imposed at a rate of $10.00 per business establishment. In addition, businesses that manufacture, sell or distribute groceries, soft drinks, carbonated waters, beer and other malt beverages must pay an additional $15 per business establishment.

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Penalty

If a litter tax return is filed late, or if the tax is paid late, a penalty equal to 100% of the tax will be assessed.

EXAMPLE: Ronnie's Restaurant filed its 2007 litter tax return on June 3. The return shows a total tax due of $25. The department will assess a penalty of $25 for late filing.

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Interest

The Code of Virginia requires the accrual of interest on any balance of unpaid tax from the due date for payment through the date the tax is paid. Interest charges apply to late payments, as well as additional balances assessed from amended returns or audit adjustments.

Interest is accrued at the federal underpayment rate established under Internal Revenue Code Section 6621, plus 2%. For corporation income tax assessments in excess of $100,000 that are over thirty days old, the interest rate is the federal underpayment rate, plus 4%. The rate is subject to change at the beginning of each calendar quarter.

Interest is not accrued on late filing or penalties at the initial point of assessment. If an assessment remains unpaid for longer than thirty days, interest will be accrued on the entire balance due, including penalty and interest, from the date of assessment through the date of payment or the date of the second notice. Interest is accrued on late payment penalties at the initial point of assessment from the due date for payment through the date of assessment.

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Application of the Tax

The litter tax does not apply to businesses where the sale or distribution of taxable products is incidental to normal business operations, such as establishments that sell snack items and soft drinks as a convenience to customers. Other examples include nursing homes, hospitals (excluding gift shops and cafeterias), dry cleaners, laundromats, antiques shops, repair garages, and companies that maintain "honor system" boxes.

To register your business for litter tax, click Registering Your Business.