Tax Type
Local Taxes
Property Tax
Description
Motor Vehicles
Topic
Property Subject to Tax
Date Issued
04-05-1993
[Opinion - Virginia Attorney General: 1993 at 263]
REQUEST BY: The Honorable N. Everette Carmichael Commissioner of the Revenue for Chesterfield County P.O. Box 124 Chesterfield, Virginia 23832-0124
OPINION BY: Stephen D. Rosenthal, Attorney General
OPINION:
You ask whether a locality that prorates personal property taxes on motor vehicles under § 58.1-3516 of the Code of Virginia has an obligation to make refunds in two hypothetical situations. In the first situation you present, a motor vehicle has a situs on tax day1 in the prorating jurisdiction, then acquires a situs in a nonprorating Virginia jurisdiction, and still later acquires a situs in another prorating Virginia jurisdiction, all in the same tax year. In the second hypothetical situation, the facts are the same except that the final situs acquired in the tax year is out of state.
I. Applicable Constitutional and Statutory Provisions
Section 1 of the Fourteenth Amendment to the Constitution of the United States provides, in part:
No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.
Section 58.1-3516(A) permits a number of jurisdictions, including Chesterfield County,2 to enact ordinances prorating personal property taxes on motor vehicles based on the number of months a motor vehicle is actually in the jurisdiction during a tax year. The second paragraph of § 58.1-3516(A) requires that "such ordinance shall also provide for relief from tax and a refund of the appropriate amount of tax already paid . . . where any motor vehicle . . . loses its situs within such locality after the tax day or after the day on which it acquires a situs," but also provides that "[n]o refund shall be made if the motor vehicle . . . acquires a situs within the Commonwealth in a nonprorating locality."
In addition, under § 58.1-3516(B), "such ordinance shall also exempt property from the levy of such personal property tax for any tax year or portion thereof during which the property was legally assessed by another jurisdiction in the Commonwealth and the tax paid."
Section 58.1-3511(A) provides, in part:
Any person domiciled in another state, whose motor vehicle is principally garaged or parked in this Commonwealth during the tax year, shall not be subject to a personal property tax on such vehicle upon a showing of sufficient evidence that such person has paid a personal property tax on the vehicle in the state in which he is domiciled. . . . Any person who shall pay a personal property tax on a motor vehicle to a county or city in this Commonwealth and a similar tax on the same vehicle in the state of his domicile may apply to such county or city for a refund of such tax payment. Upon a showing of sufficient evidence that such person has paid the tax for the same year in the state in which he is domiciled, the county or city may refund the amount of such payment.
II. Move from Prorating to Nonprorating Virginia Locality Ends Prorating Jurisdiction's Obligation to Refund Tax
Section 58.1-3516(A) specifically addresses the situation in which a taxpayer moves from a prorating Virginia locality to a nonprorating Virginia locality within the same tax year, and provides that no refund is permitted under these circumstances. See 1991 ATT'Y GEN. ANN. REP. 295. Therefore, in the first situation you present, it is clear from the plain language of the statute that the taxpayer is not due a refund as a result of a move from a prorating to a nonprorating Virginia jurisdiction.3
Generally, under § 58.1-3516(A), a prorating Virginia jurisdiction is entitled to levy and collect personal property taxes on motor vehicles that have acquired a situs in the locality after tax day for the portion of the year that the vehicle has a situs in that locality. § 58.1-3516(B) also provides, however, that a prorating jurisdiction's ordinance "shall also exempt property from the levy of such personal property tax for any tax year or portion thereof during which the property was legally assessed by another jurisdiction in the Commonwealth and the tax paid."
In the first situation you present, under § 58.1-3516(A), the initial move to a nonprorating jurisdiction would cut off the first prorating jurisdiction's obligation to refund under the statute. A subsequent move to another prorating jurisdiction in the same tax year would not alter this result. Moreover, because the motor vehicle would have been taxed legally by another jurisdiction in the Commonwealth, § 58.1-3516(B) would exempt it from personal property tax in the second prorating jurisdiction for the balance of the tax year.
III. No Personal Property Tax Refund Required When Taxpayer Moves from Prorating to Nonprorating Virginia Locality and Moves Out of State in Same Tax Year
You next ask whether the outcome would change if the taxpayer were to move from a prorating to a nonprorating Virginia locality, and then move out of state in the same tax year. The prorating jurisdiction where the vehicle had its situs on tax day still would not have to refund any of the tax paid, because § 58.1-3516(A) removes any refund obligation when a taxpayer moves from a prorating to a nonprorating Virginia locality in the same tax year.
A prior opinion of this Office concludes that the nonresident exception now in § 58.1-3511 "applies only when a vehicle is 'principally garaged' in Virginia as of January 1, and the owner is domiciled outside Virginia at that time." 1976-1977 ATT'Y GEN. ANN. REP. 291, 291.4 The nonresident exception in § 58.1-3511(A) thus would not apply in the situation you present.
In addition, another opinion of this Office concerning personal property that possibly was subject to tax in two states notes that "[t]he authority to impose [a personal property] tax in Virginia is not affected by the fact that a similar tax may be imposed against the same property by [a] jurisdiction outside the Commonwealth." 1990 ATT'Y GEN. ANN. REP. 264, 265.
The possibility that the property would be subject to personal property taxation in two states is not a bar to Virginia's levying tax on it. As a prior opinion of this Office points out:
To the extent that such taxation may constitute double taxation, it is not prohibited by the Fourteenth Amendment to the United States Constitution. This Office has previously recognized that tangible personal property may be subjected to taxation in more than one jurisdiction and that such "double taxation" is permissible.
1982-1983 ATT'Y GEN. ANN. REP. 617; see also ATT'Y GEN. ANN. REP.: 1976-1977, supra; 1974-1975 at 527; 1957-1958 at 274.
It is my opinion, therefore, that the initial taxing jurisdiction, even if it prorates personal property taxes, is not obligated to refund any of those taxes, either when the taxpayer moves to a nonprorating jurisdiction in Virginia, or on a subsequent move to an out-of-state location in the same tax year.
1 Section 58.1-3515 defines "tax day" as January 1, "except as provided under § 58.1-3010, and except as provided by ordinance or special act in localities authorized to tax certain property on a proportional monthly or quarterly basis."
2 At its 1993 Session, the General Assembly amended § 58.1-3516(A) to grant this authority to all localities, effective July 1, 1993. Ch. 557, 1993 Va. Acts (approved Mar. 25, 1993).
3 This opinion assumes that Chesterfield County has a proration ordinance that is in accordance with the applicable statutory provisions.
4 While the 1976 opinion interprets § 58-834, the predecessor to § 58.1-3511, the operative language of the two statutes is virtually identical.
Attorney General's Opinion