Tax Type
General Provisions
Description
1997 Legislative Summary
Topic
Reports
Date Issued
06-30-1997
1997 LEGISLATIVE SUMMARY - STATE TAXES
INTRODUCTION
INTRODUCTION
The Legislative Summary is published by the Department of Taxation (TAX) as a convenient reference guide to state and local tax legislation enacted by the 1997 Session of the General Assembly. It includes a general description of enacted legislation affecting:
_ State taxes administered by TAX, and
_ Local taxes which TAX administers or on which TAX renders advisory assistance.
The Summary also includes legislative studies in which TAX will be directly involved or acting in a technical support role. However, in general, legislation granting property tax exemptions, creating special taxing jurisdictions or affecting taxes administered by other state agencies is not included in the Summary.
The Summary is intended to provide a synopsis of enacted legislation and is for information purposes only. The Summary is not a substitute for the actual state law, local ordinances, and TAX regulations. Additional information on new legislation affecting state taxes may be obtained from TAX at the following telephone numbers:
Individual Income Tax (804) 367-8031
Corporation Income Tax (804) 367-8036
Sales and Use Tax (804) 367-8037
Employer Withholding Tax (804) 367-8038
Voice/TDD (804) 367-8329
Additional information on new local tax legislation should be obtained from your local Commissioner of Revenue or Treasurer.
Virginia Department of Taxation
June 1997
June 1997
STATE TAX
LEGISLATION
GENERAL PROVISIONS
LEGISLATION
GENERAL PROVISIONS
Virginia Baseball Stadium Authority - Expanded
House Bill 2552 (Chapter 884) makes a number of changes to the Virginia Baseball Stadium Authority. This summary addresses the tax provisions of this bill.
This bill expands tax entitlements of the Virginia Baseball Stadium Authority to include revenue from personal income, franchise, business, professional and occupational licensing, and corporation income taxes collected from all business transactions and earnings, and all individual salaries and wages resulting from activities conducted in connection with the baseball stadium. The department is responsible for estimating personal and corporation income tax generated from the operation of the stadium.
This bill also allows localities to levy an admissions surcharge for the purpose of reimbursing the localities for the expenses they incur in connection with a stadium.
Effective Date: July 1, 1997
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- Code Sections Amended: §§ 15.1-227.70, 15.1-227.75, 15.1-227.76, 15.1-227.78, 15.1-227.84, and 15.1-227.85
Hampton Roads Sports Facility Authority - Expanded
House Bill 2741 (Chapter 554) makes numerous changes to the Hampton Roads Sports Facility Authority. This summary addresses the tax provisions of this bill.
This bill adds individual and corporation income tax and other tax revenues, in addition to sales tax revenues, to those tax revenues generated by the operation of the facility to which the Authority would be entitled. The department is responsible for estimating personal and corporation income tax generated from the operation of the sports facility.
The bill also allows the locality in which the sports facility is located to remit certain local taxes generated from the facility to the Authority, including local sales and use taxes, admission taxes, food and beverage taxes and business, professional and occupational license taxes. The locality is also allowed to levy an admissions surcharge for the purpose of reimbursing the locality for the expenses it incurs in connection with a sports facility.
Effective Date: July 1, 1997
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- Code Sections Amended: §§ 15.1-1688, 15.1-1692 through 15.1-1696,15.1-1699, 15.1-1701, 15.1-1702, and 15.1-1703
Code Sections Added: §§ 15.1-1706, 15.1-1707, 15.1-1708 and 15.1-1709
- Code Sections Amended: §§ 15.1-1688, 15.1-1692 through 15.1-1696,15.1-1699, 15.1-1701, 15.1-1702, and 15.1-1703
Definition of Tax-Exempt Organizations - New
House Bill 1562 (Chapter 694) establishes a definition of the term “tax-exempt organization” for all taxes imposed under the Title 58.1. A tax-exempt organization is defined as any organization designated as such in writing by the Internal Revenue Service.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-1
INCOME TAX
Corporations
Worker Retraining Tax Credit - New
House Bill 2367 (Chapter 726) provides a tax credit in an amount equal to 30 percent of all expenditures made by employers for eligible worker retraining for qualified employees, or up to $100 per qualified employee if the worker retraining occurs at private schools. Qualified worker retraining consists of noncredit courses at any of the Commonwealth’s community colleges or at private schools or retraining programs through apprenticeship agreements approved by the Virginia Apprenticeship Council.
Code Section Added: § 58.1-439.6
Neighborhood Assistance Act - Amended
Senate Bill 920 (Chapter 640) and House Bill 2609 (Chapter 229) amend the Neighborhood Assistance Act.
Senate Bill 920 lowers the credit percentage from 50% to 45%, and increases the minimum credit that can be approved under the program from $50 to $400.
Applications for tax credits must now be made by neighborhood organizations and these organizations then allocate tax credits to business firms making donations.
The total amount of tax credits currently authorized under this program is $5.25 million. That amount is scheduled to increase to $8 million on July 1, 1998. Senate Bill 920 requires that, at a minimum, the $2.75 million increase in credits be allocated for education programs conducted by neighborhood organizations, and that at least ten percent of the available amount of credits each year be allocated to qualified programs of neighborhood organizations which did not receive an allocation in the preceding year.
House Bill 2609 amends the Neighborhood Assistance Act to expand the eligibility for tax credits for physicians and dentists. The bill allows a nonprofit health clinic, which charges patients according to their ability to pay, to assign Neighborhood Assistance Act tax credits to doctors and dentists who volunteer at the clinic. Previously, a health clinic could assign tax credits to doctors and dentists only if the clinic did not charge for the delivery of health care services.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-333, 58.1-430, and 63.1-320 through 63.1-325
Subtraction for the Gains on the Sale of Certain Government Obligations - New
Senate Bill 831 (Chapter 106) exempts from the Virginia corporate and individual income tax the gains on the sale of federal obligations, and obligations issued by the Commonwealth of Virginia and Virginia localities.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Sections Amended: §§ 58.1-322 and 402
Enterprise Zone Act - Amended
Senate Bill 1119 (Chapter 808) permits one enterprise zone in any locality to consist of two noncontiguous zone areas. The two noncontiguous zone areas are not considered separate zones for purposes of calculating the maximum number of zone designations established under the Enterprise Zone Act. The bill increases the statutory authority to create sub-zones to all localities.
Effective Date: July 1, 1997
Code Sections Affected: § 59.1-274, 59.1-279
Enterprise Zone Eligibility - Expanded
House Bill 2372 (Chapter 497) and Senate Bill 1119 (Chapter 808) reduce the percentage of low income individuals and/or enterprise residents a business must employee in order to be eligible for enterprise zone benefits. This percentage is reduced from 40% to 25%. In addition, this bill expands the term “enterprise zone resident” to mean individuals residing in any enterprise zone in Virginia, as well as residents of the zone where a business is operating.
Effective Date: July 1, 1997
Code Section Amended: § 59.1-279
Enterprise Zone Definition of “Permanent Full-Time Position” - Expanded
Senate Bill 804 (Chapter 634) and House Bill 2882 (Chapter 669) expand the definition of “permanent full-time position” for the enterprise zone real property investment tax credit and enterprise zone job grants to include an employee who works at least 1680 hours per year if the employee receives standard fringe benefits.
Prior to the passage of these bills, the definition of a “permanent full-time position@ was a position requiring a minimum of 35 hours of an employee’s time a week for the entire Anormal year@ of a business firm’s operations or 35 hours of an employee’s time for the portion of the taxable year in which the employee was initially hired for, or transferred to, the business firm.
Effective Date: July 1, 1997
Code Sections Amended: §§ 59.1-280, and 282.1
Enterprise Zone Act Revision - New, Expanded, and Administrative Changes
Senate Bill 820 (Chapter 517) amends, clarifies and reorganizes the Enterprise Zone Act. Under current law, the amount of enterprise zone tax credits that can be granted by the Department of Housing and Community Development (DHCD) to business firms which qualify for incentives after July 1, 1995, is subject to an annual limitation. This limitation takes the form of two credit “pools.” Business firms that qualify for the Zone Investment Tax Credit have their credits allocated from a $3 million pool. All other enterprise zone incentives are allocated from a $5 million pool.
Senate Bill 820 reassigns business firms that are required under current law to negotiate the amount of their general business tax credits from the $5 million pool to the $3 million pool. Also, this legislation allows unallocated amounts of credits in the $3 million pool to be allocated to the $5 million pool in a year when the other credit pool is oversubscribed, and vice versa.
Other amendments to the Enterprise Act include:
Changing the apportionment formula for determining the Virginia income tax of a qualified business firm that is attributable to the enterprise zone when the business operates both within and without an enterprise zone.
Allowing a business firm to count employees residing in any enterprise zone in determining their eligibility for the general business tax credit.
Requiring the DHCD to keep any information regarding a business firm’s tax liability, employment, property, or income confidential.
Authorizing the Department of Taxation to provide the DHCD with information regarding a business firm’s eligibility for tax credits.
Clarifications include the following:
The real property investment tax credit is refundable.
The Department of Taxation and the State Corporation Commission may audit, challenge, and deny a business firm’s claim to an enterprise zone credit even after certification by the DHCD.
A “business firm” is a corporation, partnership, S corporation, limited liability company, or sole proprietorship subject to the personal and corporation income tax, the minimum tax on telecommunications companies, the bank franchise tax, or the license tax imposed on insurance companies and public service corporations.
The business tax credit must also be certified to the Commissioner of Insurance for the State Corporation Commission.
Effective Date: July 1, 1997
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- Code Sections Amended: §§ 58.1-3, 59.1-271, 59.1-279, 59.1-280, 59.1-280.1
Code Section Added: § 59.1-282.4
- Code Sections Amended: §§ 58.1-3, 59.1-271, 59.1-279, 59.1-280, 59.1-280.1
Major Business Facility Job Tax Credit - Amended and Clarified
Senate Bill 914 (Chapter 786) and House Bill 2183 (Chapter 852) clarify current law as to those companies that are eligible to claim the Major Business Facility Job Tax Credit. These bills also amend the credit in the following manner:
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! Businesses operating pursuant to Virginia's parimutuel betting law are prohibited from claiming the credit.
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- ! Businesses claiming the Coalfield Employment Enhancement Tax Credit are not permitted to claim the Major Business Facility Job Tax Credit.
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- ! Jobs that are ancillary to the principal activities of a major business facility are not eligible for the credit.
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- ! Businesses are permitted to claim the credit with respect to contract employees if certain conditions are met.
Code Section Amended: § 58.1-439
Effective Date: The provisions pertaining to businesses engaged in parimutuel betting, businesses claiming the coal credit, and ancillary jobs apply to the establishment or expansion of a major business facility commenced on or after January 1, 1997. The provisions pertaining to contract employees are effective for taxable years beginning on or after January 1, 1995; however, any credits earned by taxpayers between January 1, 1995 and December 31, 1996, are limited to $750,000 in total and are further limited to taxpayers which established major business facilities in a city with a population of more than 170,000 and less than 172,000. All other provisions of these bills are declaratory of existing law.
Tax Credit for Vehicle Emissions Testing Equipment - Amended
Senate Bill 697 (Chapter 350) amends the income tax credit for purchases of clean-fuel vehicles to include the cost of vehicle emissions testing equipment certified by the Department of Environmental Quality. The credit would equal 20% of the purchase price of the certified equipment.
Code Section Amended: § 58.1-438.1
Effective Date: July 1, 1997
Virginia Coal Employment and Production Incentive Tax Credit - Extended
House Bill 2846 (Chapter 756) extends the credit under The Virginia Coal and Employment Production Incentive Tax Credit. This credit permits certain Public Service Corporations, such as public utilities, to claim a credit for purchases of coal mined in Virginia against the state license tax on gross receipts. For purchases of coal made in 1990 and thereafter, the allowable credit is $3 per ton. The credit has no carry forward provision. This credit was scheduled to expire on January 1, 2001. House Bill 2846 extends the sunset date to January 1, 2005.
Effective Date: July 1, 1997Code Section Affected: § 58.1-2626.1
Individuals
Deduction for Bone Marrow Screening Fee - New
House Bill 2859 (Chapter 909) allows individuals a deduction in determining Virginia taxable income for the initial screening fee required to become a bone marrow donor provided the donor is not reimbursed for such fee or the donor has not claimed a deduction for such fee for federal income tax purposes.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Section Amended: § 58.1-322
Declarations of Estimated Tax - New
House Bill 2352 (Chapter 257) removes the requirement that taxpayers file a separate declaration of estimated taxes. Taxpayers are no longer required to file a separate declaration of estimated income taxes owed for the taxable year, but must merely make the payment of the first installment of the estimated income tax on or before certain due dates.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-490
Tax Credits for Rent Reductions - Expanded
House Bill 2355 (Chapter 184) adds individuals who have been homeless during the last 12 months to the category of tenants for whom landlords could receive an income tax credit by offering reduced rent. “Homeless person” means only persons who resided in a domestic violence or homeless shelter during the twelve months preceding the lease term.
Effective Date: Taxable years beginning on or after July 1, 1997
Code Section Amended: § 58.1-339
Subtraction for the Gains on the Sale of Certain Government Obligations - New
Senate Bill 831 (Chapter 106) exempts from the Virginia corporate and individual income tax the gains on the sale of federal obligations and obligations issued by Virginia and Virginia localities.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Sections Amended: §§ 58.1-322 and 402
Enterprise Zone Act - Amended
Senate Bill 1119 (Chapter 808) permits one enterprise zone in any locality to consist of two noncontiguous zone areas. The two noncontiguous zone areas are not considered separate zones for purposes of calculating the maximum number of zone designations established under the Enterprise Zone Act. The bill increases the statutory authority to create sub-zones to all localities.
Senate Bill 1119 also reduces the percentage of low income individuals and/or enterprise zone residents a business must employ in order to be eligible for enterprise zone benefits from 40% to 25%.
Effective Date: July 1, 1997
Code Sections Affected: § 59.1-274, 59.1-279
Separating Refunds for Divorced Spouses - New
Senate Bill 921 (Chapter 355) requires the department to divide a joint refund between a divorced couple and to issue separate individual income tax refund checks if one spouse refuses to endorse a joint refund check or cannot be found. This bill will allow the department to assist an individual taxpayer in a situation where he or she is unable to cash a joint refund check due to circumstances surrounding a divorce.
Effective Date: Income tax refund payments issued on or after November 1, 1995- Code Section Amended: § 58.1-499
Virginia Higher Education Tuition Trust Fund - New
House Bill 2265 (Chapter 861) and Senate Bill 891 (Chapter 785) create an income tax subtraction for income attributable to a distribution or a refund from a prepaid tuition contract with the Virginia Higher Education Tuition Trust Fund to the extent the distribution or refund is subject to Federal income tax when the refund is due to the beneficiary’s death, disability, or receipt of a scholarship.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Section Amended: § 58.1-322
Neighborhood Assistance Act - Amended
Senate Bill 920 (Chapter 640) and House Bill 2609 (Chapter 229) amend the Neighborhood Assistance Act.
Senate Bill 920 lowers the credit percentage from 50% to 45%, and increases the minimum credit that can be approved under the program from $50 to $400.
Applications for tax credits must now be made by neighborhood organizations and these organizations allocate tax credits to business firms making donations.
The total amount of tax credits currently authorized under this program is $5.25 million. That amount is scheduled to increase to $8 million on July 1, 1998. Senate Bill 920 requires that, at a minimum, the $2.75 million increase in credits be allocated for education programs conducted by neighborhood organizations, and that at least ten percent of the available amount of credits each year be allocated to qualified programs of neighborhood organizations which did not receive an allocation in the preceding year.
House Bill 2609 amends the Neighborhood Assistance Act to expand the eligibility for tax credits for physicians and dentists. The bill allows a nonprofit health clinic, which charges patients according to their ability to pay, to assign Neighborhood Assistance Act tax credits to doctors and dentists who volunteer at the clinic. Previously, a health clinic could assign tax credits to doctors and dentists only if the clinic did not charge for the delivery of health care services.
Effective Date: July 1, 1997
Code Sections Affected: §§ 58.1-333, 58.1-430, and 63.1-320 through 63.1-325Income Tax Refund Check-offs
U.S. Olympic Committee Check-off - Extended
House Bill 1556 (Chapter 477) extends the sunset date in the tax refund check-off for the U. S. Olympic Committee to December 31, 1999. Contributions by Virginia taxpayers to the United States Olympic Committee are used to assist
Virginia and other U.S. athletes to receive training and support needed to compete in the Olympic Games.
Effective Date: Taxable years beginning on or after January 1, 1997, but before January 1, 2000
Code Section Amended: § 58.1-346.1:1
Family and Children’s Trust Fund of Virginia Check-off - Extended
House Bill 2326 (Chapter 396) extends the sunset date on the tax refund check-off for the Family and Children’s Trust Fund of Virginia to January 1, 2001. The Family and Children’s Trust Fund is an umbrella organization for public collaboration addressing family violence.
Effective Date: Taxable years beginning on or after January 1, 1997, but before January 1, 2000
Code Section Amended: § 58.1-346.3:1
Elderly Transportation Fund Check-off - Reenacted
House Bill 1909 (Chapter 301) reenacts the tax refund check-off for the Elderly Transportation Fund, which expired December 31, 1995. The Department for the Aging uses monies contributed to this fund to enhance transportation services for the elderly and disabled. The check-off is permanent, as it does not have a sunset date.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Section Amended: § 58.1-346.4:1
Housing Assistance Check-off - Reenacted
House Bill 2030 (Chapter 302) reenacts the tax refund check-off for the Virginia Housing Assistance Program, which expired December 31, 1995. Tax refunds designated to this program are used to provide housing assistance for the homeless, low-income elderly and the physically or mentally disabled. This check-off will expire January 1, 2003.
Effective Date: Taxable years beginning on or after January 1, 1997, but before January 1, 2003
Code Section Amended: § 58.1-346.2:1
Virginia Arts Foundation Check-off - New
House Bill 2484 (Chapter 878) creates an income tax refund check-off to fund the Virginia Arts Foundation. The foundation assists the Virginia Commission for the Arts in its statutory responsibility for promoting the arts in the Commonwealth. This check-off is permanent, as it does not have a sunset date.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Section Added: § 58.1-346.6
Chesapeake Bay Restoration Fund Check-off - New
House Bill 2589 (Chapter 890) creates an income tax refund check-off to permit individuals to make a voluntary Chesapeake Bay Restoration contribution to fund Department of Environmental Quality tributary plans. If an individual is not
eligible to receive an income tax refund or the amount of the refund is less than the contribution, the taxpayer may voluntarily make a contribution by making payment to the Department of Taxation. This check-off is permanent, as it does not have a sunset date.
Effective Date: Taxable years beginning on or after January 1, 1997
Code Section Added: § 58.1-346.6
RETAIL SALES & USE TAX
Broadcasting Exemption - Expanded
House Bill 1752 (Chapter 824) expands the current exemption for broadcasting equipment to include (1) land based wireless cable television systems and (2) open video systems provided by telephone common carriers. This bill also repeals the exemption currently available to video dialtone systems.
Under current law, the exemption applies to broadcasting equipment used by commercial radio and television companies and amplification, transmission, and distribution equipment and towers used or to be used by cable television systems or video dialtone systems. This bill expands the exemption to any land based wired or wireless cable television system and includes, for example, television programming provided through microwave transmissions. The expanded exemption also applies to an open video television system. This type of system is available through common carrier telephone companies and utilizes fiber optic technology to deliver video programming.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-609.6
Space Flight and Space Launch Activities - New
House Bill 1948 (Chapter 834) creates an exemption applicable to space flight activities in Virginia. The exemption applies to the sale, lease, use, storage, consumption, or distribution of: -
Tangible personal property, including space flight fuels, placed on or used aboard any orbital or suborbital space facility, propulsion system, space vehicle, satellite, or space station when used to conduct spaceport activities; and
Machinery and equipment used exclusively for space flight activities and the sale of goods and services provided to operate and maintain launch facilities, launch equipment, payload processing facilities and payload processing equipment used to conduct spaceport activities.
The term “spaceport activities” refers to activities directed or sponsored at a facility which is owned, leased, or operated by or on behalf of the Virginia Commercial Space Flight Authority. The Authority is a political subdivision of the Commonwealth whose purposes are to disseminate knowledge pertaining to scientific and technological development among public and private entities in the area of commercial space flight, and to promote industrial and economic development.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-609.3
Various Nonprofit and Miscellaneous Organizations - New
Exemptions from the retail sales and use tax were created for various nonprofit organizations by House Bill 1725 (Chapter 822) and Senate Bill 709 (Chapter 631). The exemptions apply to several nonprofit organizations, generally exempt from taxation under § 501(c)(3) of the Internal Revenue Code and established for a specific purpose. The exemptions are designated by type and category. The known affected organizations, Code section amended, and the bill providing the exemption are noted in parentheses.
Exemption for Purchases for Use or Consumption
Educational (effective July 1, 1997 through June 30, 2001):
An organization organized exclusively to combat illiteracy by tutoring and training adults and by increasing community awareness of the illiteracy problem. (All Literacy Council and Literacy Volunteers of America organizations - currently, only those within the Richmond Metropolitan area or the Roanoke Valley are exempt; § 58.1-609.4; HB 1725)
An organization that conducts and publishes educational research for public school improvement, reform, and teacher education and disseminates such research in the community to encourage residents to take an interest in teaching and learning activities of local schools. (The Socrates Institute; § 58.1-609.4; HB 1725)
An organization which designs, equips, and operates educational telecommunications networks and classrooms serving schools within the Commonwealth, and whose activities include purchasing audio-visual equipment, contracting for transmission services, and training teachers. (Southwest Virginia Education and Training Network; § 58.1-609.4; HB 1725)
An organization organized exclusively to support reading education programs for all Virginia citizens through local councils, special interest councils, teacher training programs, and annual conventions. (Virginia State Reading Association; § 58.1-609.4; HB 1725)
An organization organized exclusively to emphasize scientific investigation and holding an annual science fair for students within the boundaries of the Tenth (Thomas Jefferson) Planning District. (Piedmont Regional Science Fair; § 58.1-609.4; HB 1725)
An organization which provides residential treatment and educational services to abused children and their families and which operates a Head Start Program. (Childhelp/Tyler Village Foundation; § 58.1-609.4; HB 1725)
An organization which educates the public about animal agriculture and its importance to the quality of life of citizens, and supports research and education to continuously improve animal agriculture production practices. (Animal Industry Foundation; § 58.1-609.4; HB 1725)
An organization organized exclusively to promote and advance the interests of vocational-technical education in the public schools. (Colonial Heights Vocational Building Trades Foundation, Inc.; § 58.1-609.4; HB 1725)
Medical-related (effective July 1, 1997 through June 30, 1998):
An organization established to coordinate and facilitate the delivery of health care services to the children, aged birth to six years, of families whose incomes fall below the federal poverty level. (Child Health Investment Partnership; § 58.1-609.7; HB 1725)
An organization operated to initiate, promote, assist, develop, maintain, and conduct studies, investigations and research relating to the treatment and prevention of birth defects. (March of Dimes; § 58.1-609.7; HB 1725)
A foundation established to promote quality health care and health care education in the Roanoke Valley by establishing scholarships for needy and deserving students pursuing health care careers, promoting health care research, and providing health care education. (Lewis-Gale Foundation; § 58.1-609.7; HB 1725)
An organization established to provide dental services within the Eighth (Northern Virginia) Planning District at reduced rates to the indigent by dentists and dental hygienists who volunteer their time (Northern Virginia Dental Clinic, Inc.; § 58.1-609.7; HB 1725)
Civic and community service (effective July 1, 1997 through June 30, 1998):
Tangible personal property purchased by area agencies on aging through programs administered by the Virginia Department for the Aging. (Currently, local area agencies on aging enjoy an exemption from the sales and use tax for property purchased or leased for use in nonprofit nutrition programs and for food products sold under such programs; § 58.1-609.8; HB 1725)
An organization organized exclusively to foster, sponsor and promote physical education, athletic programs and contests for youths in the Eleventh Planning District Central Virginia. (Big Island Athletic Association; § 58.1-609.8; HB 1725)
An organization organized exclusively to render mutual aid to sick, disabled and needy members and their families; promote social and intellectual activities among its members and their families; and conduct educational, charitable, religious, social welfare and public relief work. (The Columbians, Inc.; § 58.1-609.8; HB 1725)
A military-related foundation which is organized to collect toys for needy children to be distributed during the Christmas season. (Marine Toys for Tots Foundation; § 58.1-609.8; HB 1725)
An organization which works with young people ages eight to eighteen and adults in solution-focused youth development programs which help young people contribute positively to their own health and creativity and to the quality of life in their community. (Alternatives, Inc.; § 58.1-609.8; HB 1725)
An organization providing a disciplined, spiritual environment through a nonprofit half-way house for nonviolent offenders discharged or diverted from prisons. (Gemeinschaft Home; § 58.1-609.8; HB 1725)
An organization organized exclusively to provide free educational services to the public regarding the preservation and protection of the Shenandoah River. (Friends of the Shenandoah River, Inc.; § 58.1-609.8; HB 1725)
A nonprofit corporation organized to repair or rehabilitate homes owned or occupied by low-income, elderly or disabled persons who could not otherwise afford to finance the repair or rehabilitation of their homes within the Eighth (Northern Virginia) Planning District. (Loudoun County Christmas in April, Inc.; § 58.1-609.8; HB 1725)
An organization organized exclusively to provide residential and housing facilities to those individuals who need assistance and support in adjusting to their environment, including individuals with mental retardation, mental illness and emotional disturbance, and which is located in any county utilizing the county manager form of government. (Community Residences, Inc.; § 58.1-609.8; HB 1725)
An organization organized exclusively to provide financial help for housing, medical and dental, transportation and utilities expenses, to individuals and families who find themselves in sudden financial crisis and which is located in any county utilizing the county manager form of government. (Arlingtonians Ministering to Emergency Needs, Inc.; § 58.1-609.8; HB 1725)
An organization which develops devotional and study materials of a religious nature, and establishes bible study classes and trains leaders for and coordinates the operation of such classes. (Community Bible Study, Inc.; § 58.1-609.8; HB 1725 and SB 709)
An organization organized to maintain 4.9 miles of public roads which serve two public lots in a vacation subdivision, a state river, and a national forest. (The Deer Rapids Road Fund Trustees, Inc.; § 58.1-609.8; HB 1725)
An organization organized exclusively to operate a long-term residential drug and alcohol treatment program featuring drug and family counseling, twelve-step programs, academic education and religious development, for young men ages thirteen through seventeen. (Mid-Atlantic Teen Challenge; § 58.1-609.8; HB 1725 and SB 709)
A nonprofit corporation organized under the laws of Virginia and whose purposes include: enriching the life of the Jewish community; raising funds for charitable purposes and for the support of Jewish needs; maintaining a Jewish Community Center; and assisting non-Jewish agencies with similar charitable and educational purposes. (United Jewish Community of the Virginia Peninsula, Inc.; § 58.1-609.8; HB 1725)
An all-volunteer organization organized to improve the recreation and living facilities of a training center whose residents have special needs. (Northern Virginia Training Center - Parents and Associates; § 58.1-609.8; HB 1725)
An all-volunteer organization organized exclusively to preserve, protect and encourage the wise use of a forty-mile swamp wilderness. (Friends of Dragon Run, Inc.; § 58.1-609.8; HB 1725)
An organization which provides information and support to individuals with autism and their families, including financial support to children with autism so they may attend special summer programs, and maintains a lending library of materials on issues related to autism and similar disorders. (Autism Society of America, Northern Virginia Chapter; § 58.1-609.8; HB 1725)
An organization organized exclusively to provide support to persons with mental retardation by providing recreation, advocacy, information, and other forms of assistance in the Sixteenth (RADCO) Planning District. (Association for Retarded Citizens - Rappahannock; § 58.1-609.8; HB 1725)
An organization organized exclusively to dispense clothing to needy individuals, emergency victims, shelter residents and low-income school children. (Radford Clothing Bank; § 58.1-609.8; HB 1725)
An organization organized exclusively to provide a youth amateur hockey program, promote the development of hockey as a participation and spectator sport, and encourage the ideals of sportsmanship, fair play, and teamwork. (Greater Richmond Youth Hockey Association; § 58.1-609.8; HB 1725)
A nonprofit corporation organized under the laws of Virginia prior to 1969 which provides child day care services to low-income families, and provides meals, dental care, and early intervention services for at-risk children. (Falls Church-McLean Day Care Center, Inc.; § 58.1-609.8; HB 1725)
An organization which is a network of congregations, agencies and community organizations with programs that provide support assistance, education and referral to people with physical, mental and social needs by trained and supportive volunteers. (Prince William Interfaith Volunteer Caregivers; § 58.1-609.8; HB 1725)
An organization organized exclusively to reduce crime in the Commonwealth by providing cash rewards to anonymous callers who supply information to law enforcement officials to effect the arrest and indictment of criminals. (Manassas City Crime Solvers; § 58.1-609.8; HB 1725 and SB 709)
A nonprofit corporation organized to operate a summer camp for disadvantaged children ages nine through twelve without charge to the attendees or their families. (Virginia Elks Youth Camp, Inc.; § 58.1-609.8; HB 1725 and SB 709)
An organization organized to conduct campaigns, solicit, collect, receive, hold, administer, expend, convey and otherwise dispose of funds and real and personal property for the support of the United Jewish Appeal, Inc., and support other Jewish advocacy organizations. (United Jewish Appeal Federation of Greater Washington, Inc.; § 58.1-609.8; HB 1725)
A nonprofit corporation organized under the laws of Virginia to promote and support sound environmental protection policies in Virginia among a network of member organizations and conduct and promote research and study of environmental problems. (Virginia Conservation Network; § 58.1-609.8; HB 1725)
An organization providing supervised housing and residential support services to low-income, mentally and physically disabled individuals. (Robert E. Rose Memorial Foundation; § 58.1-609.8; HB 1725)
An organization which grants wishes to children with life- threatening illnesses. (Make-a-Wish Foundation of the Mid- Atlantic, Inc.; § 58.1-609.8; HB 1725)
An organization providing emergency financial assistance for rent, utilities, food, prescriptions and transportation to individuals at the poverty level or below; and which teaches reading through its literacy program and parenting through its parenting program. (Presbyterian Community Center, Inc.; § 58.1-609.8; HB 1725)
A nonprofit corporation organized under the laws of Virginia and operated exclusively to provide food, furniture, rent assistance, transportation, and day-care services to low-income families and located within any county operating under the urban county executive form of government. (Annandale Christian Community for Action, Inc.; § 58.1-609.8; HB 1725 and SB 709)
An organization organized to help girls of all backgrounds work together to find their identities and develop their potential through year-round daily programming (Girls Incorporated of Bristol; §58.1-609.8; SB 709)
An organization exempt from federal income taxation under § 501(c)(3) and from local property taxation, organized to provide people with disabilities the assistance and support necessary to enable them to live valued lives in the community by providing twenty-four hour living assistance directly to Virginia citizens through residential arrangements, training, and supervision (Resources for Independence of Virginia, Inc.; § 58.1-609.8; SB 709)
Cultural (effective July 1, 1997 through June 30, 1999):
An organization organized exclusively to acquire, reconstruct and preserve the adult home and burial place of a signer of the Declaration of Independence and to cooperate with universities within the Commonwealth in training artisans and others in preservation skills. (The Menokin Foundation; § 58.1-609.9; HB 1725)
An organization operated to acquire, renovate, construct, and operate a Civil War site and museum and an adjacent Civil War era residence. (Pamplin Foundation; § 58.1-609.9; HB 1725)
A nonprofit foundation organized to encourage interest in the fine and performing arts, and provide instruction and training for individuals in, and facilities for experimentation and development of, the composition and presentation of the fine and performing arts. (The Barter Foundation, Inc.; § 58.1-609.9; SB 709)
A nonstock, nonprofit performing arts organization providing professional theatrical productions at reasonable cost to audiences in the Commonwealth and which receives financial support from the Commonwealth and leases facilities from the Virginia Museum of Fine Arts. (Commonwealth Players, Inc. d/b/a Theatre Virginia; § 58.1-609.9; SB 709)
Miscellaneous (effective July 1, 1997 through June 30, 1999):
An organization organized exclusively to promote the social welfare and defend the human rights of persons born and unborn. (Human Life International, Inc.; § 58.1-609.9; HB 1725)
A nonstock, nonprofit corporation organized under the laws of Delaware to promote the private sector development of Romania and carry out all other purposes and policies of the Support for East European Democracy Act of 1989 (Romanian-American Enterprise Fund; § 58.1-609.10; SB 709
Civic and Community services (effective July 1, 1997 through June 30, 1998):
A nonprofit corporation organized exclusively for the purpose of providing support to public libraries. (Library “friends” organizations; § 58.1-609.8; HB 1725)
A volunteer organization providing support services to Al-Anon family groups and friends of alcoholics within the Commonwealth by: (i) operating an information clearinghouse, (ii) staffing a volunteer hotline, (iii) providing speakers and literature promoting public awareness of alcoholism, and (iv) coordinating Al-Anon public service activities for the general public, schools, hospitals, churches, the professional community, and industry. (Al-Anon Service Center of Northern Virginia; § 58.1-609.8; SB 709)
Cultural (effective July 1, 1997 through June 30, 1999):
An organization organized exclusively to foster, promote and increase musical knowledge, appreciation, experience and performing ability of young people by establishing one or more youth symphony orchestras in the Commonwealth (Northern Virginia Youth Symphony Association; § 58.1-609.9; SB 709)
Miscellaneous (effective July 1, 1997 through June 30, 1999):
Any civic youth organization organized solely for the purpose of promoting community little league-type baseball or softball within the Second (Cumberland Plateau) Planning District. (§ 58.1-609.10; HB 1725)
Sales Only
Miscellaneous (effective July 1, 1997 through June 30, 1999):
Livestock sold at auction by the chamber of commerce exempt from taxation under § 501(c)(6) of the Internal Revenue Code, provided that the proceeds of such auction are distributed to contestants in a junior livestock show and sale. (Danville Chamber of Commerce; § 58.1-609.10; HB 1725)
Other Transactions
Cultural (effective July 1, 1997 through June 30, 1999):
The sale or charges for rooms, lodgings, or meals furnished by a Jewish women’s charitable corporation which provides: opportunities for health education programs, primarily regarding women’s health care; youth activities; education on issues of importance to the community; and an opportunity for doctors from Israel to participate in an exchange program with physicians associated with medical colleges in Virginia. (Hadassah, the Women’s Zionist Organization of America, Inc.; § 58.1-609.9; HB 1725)
Miscellaneous (effective July 1, 1997 through June 30, 1999):
A professional’s provision of original, revised, edited, reformatted or copied documents to its client or to third parties in the course of the professional’s rendition of services to its clientele. (§ 58.1-609.10; HB 1725)
Lodging and meals for members paid by, and tangible personal property purchased for use or consumption by, a nonprofit veterans association organized to provide scholarships, supplemental insurance, and interest-free loans to National Guard members who have lost their full-time jobs, homes, or cars. (Virginia National Guard Association and Virginia Army/Air National Guard Enlisted Association; § 58.1-609.10; HB 1725)
Expand Current Exemption for Nonprofit Schools: § 58.1-609.4(2)(I)
-
- House Bill 1725 (Chapter 822) and Senate Bill 709 (Chapter 631), along with Senate Bill 706 (Chapter 101) also expand the current sales and use tax exemption for nonprofit public and private colleges or other institutions of learning (including primary and secondary schools) to include food purchased for free distribution at the facilities of the nonprofit college or other institution of learning.
- House Bill 1725 (Chapter 822) and Senate Bill 709 (Chapter 631), along with Senate Bill 706 (Chapter 101) also expand the current sales and use tax exemption for nonprofit public and private colleges or other institutions of learning (including primary and secondary schools) to include food purchased for free distribution at the facilities of the nonprofit college or other institution of learning.
Technical Corrections
Nonprofit Organization Exemption: § 58.1-609.8(32)
House Bill 1725 (Chapter 822) and House Bill 2563 (Chapter 735) make technical corrections to an existing sales and use tax exemption, enacted primarily for Ruritan Clubs of Virginia, by changing the nonprofit designation from §501(c)(3) of the Internal Revenue Code to § 501(c)(4).
Advertising and Media Related - Extended
House Bill 1725 (Chapter 822), House Bill 1643 (Chapter 717), and Senate Bill 705 (Chapter 307) extend for an additional five years, to June 30, 2002, the current exemption from the sales and use tax for sales of printing such as catalogs, letters, brochures, reports, and similar printed materials, except administrative supplies, to a Virginia advertising agency for distribution out-of-state. The exemption also applies to newspaper supplements, not otherwise exempted, when purchased by advertising agencies for placement in in-state or in out-of-state publications. Advertising agencies are required to certify to the Tax Commissioner, upon request, that the printed materials were distributed outside the Commonwealth.
These bills also extend for an additional five years, the current exemption from the sales and use tax for:
The sale, rental, and lease of films, audio or video tapes, or other audiovisual works intended for licensure, distribution, broadcast, commercial exhibition, or for use in the production of another audiovisual work;
All creative works and services used in connection with the production of any portion of an audiovisual work intended for distribution, broadcast, commercial exhibition, or for use in the production of another work;
Charges for production facilities in those situations where a tangible product is transferred; and
Equipment, parts and accessories, used in the production of audiovisual works intended for distribution, broadcast, other commercial exhibition, or for use in the production of another work.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-609.6
Nonprescription Drugs and Proprietary Medicines - Expanded
House Bill 1665 (Chapter 696) expands the sales and use tax exemption for nonprescription drugs and proprietary medicines to include samples of nonprescription drugs and proprietary medicines distributed free of charge by the manufacturer, including packaging materials and constituent elements and ingredients. Currently, pharmaceutical manufacturers are subject to the use tax, based on the cost price, of nonprescription drug samples distributed in Virginia by their salespersons.
The current nonprescription drug exemption was enacted by the 1990 General Assembly to be effective July 1, 1992. The effective date has been deferred every two years since 1992 by the General Assembly. The exemption is currently scheduled to become effective July 1, 1998.
The effective date of the exemption for nonprescription drug samples would coincide with the effective date of the exemption for nonprescription drugs and proprietary medicines. In other words, there will be no exemption for the nonprescription drug samples until the exemption for nonprescription drugs is effective.
Effective Date: July 1, 1998
Code Section Amended: § 58.1-609.7
Correction of Errors in Local Sales Tax Distribution - New
House Bill 2316 (Chapter 725) requires that upon discovery of an error in the distribution of local sales tax revenues to cities and counties, the Commonwealth adjust underpayments of such tax in the next six months following the discovery of the error. One-sixth of the total adjustment must be included in the payments for each of the next six months. This bill would also require a refund of erroneous underpayments for three years preceding the discovery of the error if such underpayments have not been previously refunded.
Currently adjustments usually occur over a period of several months due to the fact that errors may go back several years and the erroneous underpayment may exceed the revenue from the monthly distribution of the 1% local sales tax based on the point of sale. The localities involved may negotiate a Special Agreement that the misallocated amount be transferred at one time or in negotiated amounts over a period of time.
Effective Date: July 1, 1997
Code Section Added: § 58.1-605
Distribution of Local Sales and Use Tax - New
House Bill 1976 (Chapter 245) provides a three-year limitations period for adjustments to correct an error in the monthly distribution of local sales and use tax monies to localities when the error is attributable to a misallocation of funds by a dealer. The limitations period begins on the date of the payment error.
This bill does not limit the rights of localities which, prior to July 1, 1997, are in an agreement with the state or are in negotiations for an agreement with the state to correct a distribution error.
Revenue from the 1% local sales tax is distributed monthly to counties and cities based on the point of sale. Point of sale is determined through information filed with the dealer’s sales and use tax return. The 1% local use tax collected from out-of-state dealers is distributed monthly to counties and cities based on sales destination, if determinable, as reported by dealers.
If errors are made in the distribution to localities, they must be corrected through an adjustment in distribution to the affected localities for the next month or
subsequent months. Under current law, there is nothing to limit the period to correct errors and make the appropriate adjustment. This bill requires that an adjustment to correct an error in distribution be made within three years of the date of the payment error when the error is attributable to a misallocation of funds by a dealer. Distribution errors resulting from other sources are not subject to the three-year limitations period.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-605
MISCELLANEOUS TAXES
Watercraft Sales and Use Tax
Definition of Watercraft - Expanded, Amended, Clarified
House Bill 2482 (Chapter 877) expands the current definition of “watercraft” to include any vessel on the water propelled by machinery whether or not the machinery is the principal source of propulsion.
Under current law, the definition of “watercraft” includes vessels which are 15 feet or longer in length and powered by a motor in excess of 25 horsepower. This bill eliminates the size and horsepower requirements to include any vessel on the water propelled by machinery. This would include small motorboats, personal watercraft (i.e., jet skis), and small sailboats equipped with auxiliary motors. Sailboats longer than 18 feet are currently defined as “watercraft” and are not affected by this bill.
Small motorboats, jet skis, and other vessels not meeting the current definition of “watercraft” are currently subject to Retail Sales and Use Tax at a rate of 4.5%. Under this bill, these vessels will be taxed as watercraft at the rate of 2% of the sales price.
Generally, no watercraft may be operated unless the owner has applied to the Virginia Department of Game and Inland Fisheries (DGIF) for a certificate of title. Under this bill, small motorboats, jet skis, and other vessels not meeting the current definition of “watercraft” would require titling by DGIF.
This bill also amends the definition of “dealer” to mean a “watercraft dealer” as defined in § 29.1-801. This definition includes any person who sells or offers to sell two or more watercraft within any twelve consecutive months. Currently, a “dealer” is defined as any person who is in the regular business of selling watercraft.
This bill also specifies that the funds generated by the Watercraft Sales and Use Tax shall be made available to DGIF for a wide range of boating-related activities and expenses.
Effective Date: January 1, 1998
Code Sections Amended: §§ 29.1-712, 29.1-716, 29.1-717, 58.1-1401, 58.1-1404, 58.1-1405, and 58.1-1410
Estate Tax
Proration of Estate Tax Penalty and Interest - Amended
House Bill 2222 (Chapter 254) requires that any fiduciary that must pay either a federal or state estate tax apportion any interest and penalty due proportionally to the beneficiary’s interests. However, the fiduciary has the discretion to charge any interest due on a temporary estate, interest or corpus, against either the temporary estate, interest or corpus, or partially against the temporary estate, interest or corpus. To make this determination, the fiduciary must fairly balance all interests in the property or fund.
Effective Date: July 1, 1997
Code Section Amended: § 64.1-161
Cotton Tax
Creation of Cotton Tax - New
House Bill 2448 (Chapter 873) imposes an 85 cent fee per bale of cotton sold in Virginia. Cotton handlers are to deduct the fee from payments made to cotton producers. The revenue will be used to pay for a referendum of cotton producers as to whether the fee should be imposed to promote the cotton industry. If the referendum passes, a Virginia Cotton Board will be created to use the revenue to encourage an expanded program of research, education and promotion of the growth and use of cotton.
Effective Date: July 1, 1997
Code Sections Added: §§ 3.1-1081 through 3.1-1103
TAX COLLECTION & ADMINISTRATION
Disclosure of Confidential Tax Information: Student Loans - New
House Bill 1988 (Chapter 705) authorizes the Tax Commissioner to share certain tax information with the executive officer of the designated student loan guarantor for the Commonwealth of Virginia. This tax information is limited to the names and home addresses of persons identified by the designated guarantor as having delinquent loans which are guaranteed by the designated guarantor.
This bill also deletes the existing provision which allows the Tax Commissioner to share tax information with the Executive Director of the State Education Assistance Authority (SEAA). The SEAA is abolished and its functions were privatized effective July 1, 1995.
Effective Date: March 21, 1997
Code Section Amended: § 58.1-3
Disclosure of Confidential Tax Information: Private Collectors - New
Senate Bill 929 (Chapter 787) authorizes the Tax Commissioner to provide taxpayer name and address information to private collectors entering into a written agreement with the Tax Commissioner. The information is for the private collector’s confidential use when acting on behalf of the Commonwealth or any of its political subdivisions in the collection of delinquent governmental receivables.
Under this bill, the Tax Commissioner is not authorized to provide information to a private collector who has used or disseminated in an unauthorized or prohibited manner information previously provided by the department.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3
Tax Commissioner: Appeal for Correction of Assessment
House Bill 2906 (Chapter 428) requires the Tax Commissioner to state in writing the facts and law supporting the determination on any application for correction of a tax assessment filed pursuant to Code of Virginia § 58.1-1821.
This bill codifies current administrative policy.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-1822
Payment of Taxes by Electronic Funds Transfer - New
House Bill 2900 (Chapter 193) allows the Tax Commissioner to require certain business taxpayers to pay their state taxes by electronic funds transfer. This requirement applies to business taxpayers paying corporate income tax, retail sales and use tax, and withholding tax. For each of these taxes, if the average monthly liability exceeds $20,000, the taxpayer is required to remit that tax by electronic funds transfer. The $20,000 threshold applies separately to each tax. For example, if the average monthly sales tax liability of a taxpayer exceeded $20,000, but the average monthly liability for corporate income tax and withholding tax did not, the taxpayer would only be required to remit sales taxes by electronic funds transfer.
The bill requires the Tax Commissioner to promulgate guidelines to determine eligibility criteria. Such guidelines would specify how the "average monthly liability" would be computed and safeharbor rules for taxpayers with seasonal fluctuations in their tax payments. In addition, these guidelines would set forth rules applicable to business taxpayers whose average monthly liability no longer exceeds $20,000. The bill requires the Tax Commissioner to seek input from interested groups including tax practitioners and representatives of the business community in the development of the guidelines.
Effective Date: On or after July 1, 1997
Code Section Added: § 58.1-202.1
Tax Amnesty Program - Statute Repealed
House Bill 1576 (Chapter 63) repeals the statute enacted in 1989 which created the Virginia Tax Amnesty Program. The Virginia Tax Amnesty Program ended in 1990, and this bill merely removes the obsolete language from the Code of Virginia.
Effective Date: July 1, 1997
Code Section Repealed: § 58.1-1840
LOCAL TAX
LEGISLATION
TANGIBLE PERSONAL PROPERTY
Classification for Motor Vehicles Leased by Auxiliary Police Officers - New
House Bill 1837 (Chapter 244) creates a separate classification for tangible personal property tax for motor vehicles leased by auxiliary police officers. The classification applies to motor vehicles for which auxiliary police officers are obligated by the terms of the lease to pay the tangible personal property tax on the leased vehicle. Localities may not tax motor vehicles leased by auxiliary police officers at a rate exceeding the rate applicable to the locality’s general class of tangible personal property.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3506
Payment Options - New
House Bill 1881 (Chapter 481) allows localities to offer taxpayers payment options for paying the tangible personal property tax. Localities may offer taxpayers payment options including coupon books, payroll deductions, and other options adopted by localities which allow the taxpayer to determine whether to pay the tangible personal property tax through monthly, bimonthly, quarterly, or semiannual installments or in a lump sum. Taxpayers are still required to pay the tangible personal property tax in full by the final due date.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3916
Classification for Antique Motor Vehicles; Exemption of Household Goods and Personal Effects - New
House Bill 2177 (Chapter 250) classifies antique motor vehicles which may not be used for general transportation purposes as household goods and personal effects. Localities may exempt from the tangible personal property tax all tangible personal property classified as household goods and personal effects. This legislation also addresses the exemption of household goods and personal effects under the personal property tax. Localities may no longer partially exempt tangible personal property classified as household goods and personal effects; localities may only fully exempt all tangible personal property classified as household goods and personal effects or levy the tangible personal property tax on such property at the rate applicable to the locality’s general class of tangible personal property.
Antique motor vehicles used for general transportation purposes are a separate classification of tangible personal property and may be taxed by localities at a rate not to exceed the rate applicable to the locality’s general class of tangible personal property.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-3503, 58.1-3504, 58.1-3506
Programmable Computer Equipment and Peripherals - Expanded
House Bill 2314 (Chapter 457) expands the tangible personal property classification for programmable computer equipment to include computer peripherals. Localities are required to use the same method of valuation for programmable computer equipment and computer peripherals in arriving at fair market value.
Localities may tax programmable computer equipment and peripherals used in a trade or business at a rate not to exceed the rate applicable to the locality’s general class of tangible personal property. Localities may tax all tangible personal property employed in a trade or business, not specifically classified for valuation purposes, at a rate not to exceed the rate applicable to the locality’s general class of tangible personal property.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-3503, 58.1-3506
Notice to Lessees of Motor Vehicles - New
House Bill 2363 (Chapter 398) requires lessors of motor vehicles to give written notice in bold print, regarding tangible personal property taxes to be paid, to lessees contractually obligated to pay the tax. Lessors are also required to forward the tangible personal property tax bill, or in certain cases a facsimile or a copy of such bill, to the lessee within ten business days of receipt.
Effective Date: July 1, 1997
Code Section Added: § 58.1-3516.2
Determining Fair Market Value; Assessment Ratios - Clarified
House Bill 2558 (Chapter 192) clarifies that the local commissioner of the revenue or other assessing official is the official who determines the fair market value of tangible personal property separately classified for valuation purposes. Unless a local governing body approves of the use of assessment ratios, local commissioners of the revenue and other assessing officials may no longer use such ratios in arriving at the fair market value of tangible personal property. Only local governing bodies may approve of the use of assessment ratios as only local governing bodies can set tax rates.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3503
REAL ESTATE TAX
Maximum Net Combined Financial Worth of the Elderly and Handicapped - Amended
House Bill 1961 (Chapter 704) increases the maximum net combined financial worth the elderly and handicapped may have in order to qualify for a deferral of or exemption from local real property tax on mobile homes and real estate. The maximum net combined financial worth increases from $75,000 to $100,000 in localities electing, by ordinance, to exempt or defer the real property taxes of elderly and handicapped persons.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3211
Judicial Sale of Real Property - Amended, Clarified
House Bill 2275 (Chapter 724) allows local treasurers and collection officers, collecting delinquent real property taxes, to bring an action for the judicial sale of real property on the December 31 following the second anniversary of the date such taxes were due. Under prior law, local treasurers and collection officers could not bring such an action until the December 31 following the third anniversary of the date real property taxes became due.
Courts no longer are allowed to refer the hearing and report on a judicial sale of real property to an attorney in the same firm as the attorney employed to subject the real estate to a tax lien.
House Bill 2275 clarifies that the sales price achieved from a judicial sale of real property by public auction is presumed to be fair market value for purposes of approval of the sale.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-3965, 58.1-3966, 58.1-3969
Exemption for the Elderly and Handicapped: Total Combined Income - New
Senate Bill 842 (Chapter 710) requires localities to exclude life insurance benefits paid to an elderly or handicapped person for purposes of determining whether such person qualifies for an exemption from or deferral of local real estate taxes.
In order to qualify for local tax relief, elderly and handicapped persons may not have a total combined income exceeding the greater of $30,000 or income limits based upon family size for the respective metropolitan statistical area. This applies to localities electing to exempt or defer the real property taxes of the elderly and handicapped must exclude life insurance benefits when calculating total combined income.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-3211, 58.1-3213
Exemption for the Elderly and Handicapped: Definition of Income - New
House Bill 2439 (Chapter 872) requires localities providing an elderly or handicapped property tax exemption to use “gross income from all sources” as the basis for determining whether the elderly and handicapped meet income limitations to qualify for an exemption from or deferral of local real property taxes. However, electing localities must exclude from “gross income” life insurance benefits and moneys received from the borrowings or other debts of elderly and handicapped persons. In order to qualify for local tax relief, elderly and handicapped persons may not have a total combined income exceeding the greater of $30,000 or income limits based upon family size for the respective metropolitan statistical area.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3211
Disposition of Surplus Proceeds from Real Estate Tax Sales - Clarified
Senate Bill 1120 (Chapter 327) clarifies that a city or county has the discretionary authority to pay over surplus proceeds from tax lien sales to the former owner of the property sold, his heirs or assigns, provided the claiming party shows entitlement to such surplus proceeds.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3967
Environmental Restoration Sites - New
House Bill 2141 (Chapter 849) creates a separate classification for real property tax for environmental restoration sites. Localities may, by ordinance, exempt or partially exempt such real property from local taxation annually for a period not in excess of five years.
Effective Date: July 1, 1997
Code Section Added: § 58.1-3664
BUSINESS, PROFESSIONAL, OCCUPATIONAL AND LICENSE TAX
Tax on Merchants Selling Bicentennial Medals - Repealed
House Bill 1575 (Chapter 62) repeals the prohibition on Virginia localities from imposing a local license fee or tax on wholesalers or retailers selling bicentennial medals on a nonprofit basis for the benefit of the Virginia Independence Bicentennial Commission or any local bicentennial commission. Localities whose local ordinance provides for the licensing of wholesalers and retailers may impose a local license fee or tax on all merchants selling bicentennial medals.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3703
Statute of Limitations for Appealing License Tax Assessments - Expanded
House Bill 2187 (Chapter 251) amends the statute of limitations for taxpayers appealing license tax assessments to a circuit court to allow appeals to be made within one year from the date of a final determination made by the Department of Taxation. Local assessing officials may also appeal such final determinations to a circuit court within one year from the date of the determination. Both taxpayers and local assessing officials wishing to appeal Department of Taxation determinations to a circuit court have the later of (i) three years from the last day of the year for which an assessment is made, (ii) one year from the date of the assessment, or (iii) one year from the date of a final determination made by the Department of Taxation, in which to file an appeal.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3984
Business, Professional, Occupational License Tax Requirements - Clarified
House Bill 2447 (Chapter 732) clarifies that localities with a population greater than 50,000 have the authority, through their local licensing ordinances, to exempt businesses with gross receipts of less than $100,000.00 from all license tax requirements, including the requirement to apply for the issuance of a business license.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3703.1
Business, Professional, Occupational License Fee and Tax - Amended
House Bill 2783 (Chapter 903) prohibits localities imposing a local license tax from charging a fee and imposing a gross receipts tax on businesses. Currently, localities which impose a local license tax are authorized to charge a fee for issuing a license not to exceed $30 in jurisdictions with a population less than 25,000; $50 in jurisdictions between 25,000 and 50,000; and $100 in jurisdictions with a population over 50,000. Current law further permits a locality to impose a gross receipts tax on these same businesses provided the gross receipts exceed the threshold applicable in that particular locality.
Effective Date: July 1, 1998
Code Section Amended: § 58.1-3703
Gross Receipts From Charitable Gaming Activities - New
House Bill 2041 (Chapter 838) prohibits localities, with the exception of local governing bodies located within the Hampton Roads Planning District, from imposing a gross receipts, entertainment, admission or any other tax based on revenues of qualified organizations derived from the conduct of charitable gaming. Code of Virginia § 18.2-340.15 et seq. provides a definition of “qualified organizations.” House Bill 2041 includes many other amendments unrelated to local license tax law.
Effective Date: July 1, 1997
Code Section Amended: § 18.2-340.32
Gross Receipts of Motor Carriers, Common Carriers, and Other Carriers - New
House Bill 2159 (Chapter 283) prohibits localities from imposing a local license fee or a local license tax upon 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. House Bill 2159 includes many other amendments unrelated to local license tax law.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3703
MISCELLANEOUS TAXES
Merchants’ Capital Tax
Classification for Inventory of Pharmaceutical Wholesalers - New
House Bill 1712 (Chapter 71) creates a separate classification for merchants’ capital tax for the inventory of pharmaceutical wholesalers. Localities may tax the inventory of pharmaceutical wholesalers at a rate not to exceed that applicable to merchants’ capital.
Effective Date: July 1, 1997
Code Section Added: § 58.1-3510.01
Machinery and Tools Tax
Elimination of Classification for Machinery and Tools Used in Food Processing - Amended
House Bill 2100 (Chapter 77) eliminates the separate classification for machinery and tools used in food processing. Localities may no longer tax machinery and tools used in food processing at rates lower than rates applicable to the general class of machinery and tools.
However, localities that have already adopted a lower rate for machinery and tools used in food processing may continue to tax such machinery and tools at a rate below the tax rate applicable to the general class.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3508.1
Consumer Utility Tax
Effective Date for Rate Changes - Amended
House Bill 2188 (Chapter 252) changes the effective date for rate changes in local consumer utility taxes from 60 days after the locality gives certified notice of the change to service providers to 120 days after service providers receive certified notice of the rate change from the locality.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3812
Enhanced Emergency Telephone Service Tax
Recovery of Operational Costs - Expanded
Senate Bill 690 (Chapter 306) allows counties, with a population of at least 45,000 but no more than 47,000, to include the salary of the director or coordinator of an E-911 program in the operational costs that may be offset by the imposition of the enhanced emergency telephone service tax. Such directors or coordinators must have no other duties besides the responsibility for the E-911 program.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3813
Transient Occupancy Tax
Augusta, Caroline, Dinwiddie, James City, Page, and Tazewell Counties Allowed to Impose Maximum 5% Tax - New
House Bill 2611 (Chapter 764) and Senate Bill 837 (Chapter 757) allow the counties of Augusta, Caroline, Dinwiddie, James City, Page, and Tazewell to impose a transient occupancy tax at a maximum rate of five percent. The revenues collected from that portion of the tax exceeding two percent must be designated and spent solely for tourism, marketing, or initiatives that attract travelers to the locality and generate tourism revenues in the locality.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3819
Admissions Tax
County with a Major League Baseball Stadium - New
House Bill 2551 (Chapter 287) authorizes any county with a major league baseball stadium which has a seating capacity of at least 40,000 to: (1) impose an admissions tax not to exceed 10% and (2) levy a surcharge not to exceed 2%, on the charge for admission to events at the stadium.
The authority to impose the admissions tax and surcharge expire on January 1, 2002, if the Virginia Baseball Stadium Authority has not executed a lease with a major league baseball team.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-3817, 58.1-3818
TAX COLLECTION & ADMINISTRATION
Local Enterprise Development Zone - Amended and New
Senate Bill 819 (Chapter 314) creates the Local Enterprise Development Taxation Program, which will be funded by all, or a specified portion, of the incremental increase in real estate or machinery and tool tax revenues within the zone. It authorizes localities to create local enterprise zones within those areas designated state enterprise zones.
Effective Date: July 1, 1997
Code Sections Affected: § 59.1-283, and §§ 58.1-3245.6 through 58.1-3245.11
Local Enterprise Zones - Amended
House Bill 2031 (Chapter 379) permits one enterprise zone in any county, city or town to consist of two noncontiguous zone areas. The two noncontiguous zone areas are not considered separate zones for purposes of calculating the maximum number of zone designations established under the Enterprise Zone Act. This bill expands the present statutory authority to create a sub-zone beyond counties with a population density of 150 or fewer people per square mile.
Effective Date: July 1, 1997
Code Section Affected: § 59.1-274
Distribution of Land and Tangible Personal Property Book - Amended
House Bill 1790 (Chapter 701) relieves local commissioners of the revenue of the responsibility of delivering a copy of land and tangible personal property books to the Department of Taxation, unless specifically requested by the department in writing.
Effective Date: July 1, 1997
Code Sections Amended: §§ 58.1-3118, 58.1-3310
Third Party Tax Payment Agreements: Mortgage Loan Agreements Prohibited - Clarified
House Bill 2049 (Chapter 180) prohibits local treasurers from entering into agreements authorizing third parties to offer to taxpayers tax payment agreements in the nature of mortgage loan agreements. Third parties contracting to pay the local taxes or other local obligations of a taxpayer cannot obtain the legal authority, from a local treasurer, to make a mortgage loan with the taxpayer. Generally, a person wishing to make mortgage loans must obtain a license and file a bond with the Commissioner of the Bureau of Financial Institutions of the State Corporation Commission.
Effective Date: July 1, 1997
Code Sections Amended: §§ 6.1-330.55, 58.1-3018
Technical Corrections and Changes to Local Revenue Collection Statutes
House Bill 2364 (Chapter 496) makes changes and implements technical corrections to local revenue collection statutes. Local treasurers are provided authorization to:
collect non-tax charges by third party liens or distrain; and to
administer oaths to taxpayers and other persons prior to examination on issues of tax liability and to summon these individuals to produce documents.
This bill also provides:
clarification that under § 58.1-3958 a city, county or town may by ordinance provide for the recovery of reasonable attorney’s or collection agency’s fees actually contracted for in the collection of taxes and other charges;
that § 58.1-3922 is amended to provide that taxes payable in installments shall be considered delinquent if all of the taxes are not paid by the date the last installment is due;
for the amendment of § 58.1-3934 to authorize the governing body of a city, county or town to appoint or hire, with the approval of the treasurer, an attorney to collect non-real estate taxes and other charges with the same authority and remedies as are provided to the treasurer.
that a treasurer has the discretion to publish, one or more times, the delinquent tax lists he is required to prepare;
Effective Date: July 1, 1997
Code Sections Amended: §§ 46.2-755, 58.1-22, 58.1-526, 58.1-3128, 58.1-3916, 58.1-3921, 58.1-3922, 58.1-3924, 58.1-3933, 58.1-3934, 58.1-3941, 58.1-3952 and 58.1-3958; (58.1-3928 repealed)
Technology Zones Maximum Acreage - Amended
Senate Bill 880 (Chapter 168) allows localities to increase the maximum acreage for which a technology zone can be established from 125 acres to unlimited acreage.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3850
Recording Satisfaction of Tax Payment Agreements - Amended
House Bill 2119 (Chapter 846) requires a third party taxpayer to record a certificate of release within 90 days of the satisfaction of any third party tax payment agreement covering real property taxes. Third party taxpayers can no longer utilize marginal releases to record satisfaction of tax payment agreements between third parties and primary taxpayers. Certificate of releases must be recorded in the local circuit court wherein the real property is situated.
Effective Date: July 1, 1997
Code Section Amended: § 58.1-3018
Virginia Regional Industrial Facilities Act - New
Senate Bill 1019 (Chapter 276) provides authority for three or more governing bodies, within Planning Districts 4 and 5, to create, as a political subdivision of the Commonwealth, a regional industrial facility authority, whose purpose would be to enhance the economic base for the member counties, cities, and towns by developing, owning, and operating one or more industrial facilities on a cooperative basis.
The bonds issued by the authority for funding, the income and interest derived from them, and any profit realized in their sale would be exempt from every type of state and local taxation. Member localities of the authority could direct by ordinance or resolution that machinery and tools tax revenue collected with respect to machinery and tools located on the facility may be remitted to the authority for use in the payment of debt service on bonds or on other obligations of the authority.
Effective Date: July 1, 1997
Code Sections Added: §§ 15.1-1706 through 15.1-1722
LEGISLATIVE
STUDIES
STUDIES
HJR 532: The Commission on State and Local Government Responsibility and Taxing Authority (HJR 108 -1996) The commission will focus on the level of responsibility of Virginia state and local governments in providing certain services, and the impact on state and local taxation. The Commission has also been requested to study funding mechanisms and creative approaches to meet the infrastructure needs of rapidly growing localities (SJR 373) and to study the advisability of reducing or eliminating the tangible personal property tax in the Commonwealth (SJR 385). TAX is to provide technical assistance.
SJR 258: Requesting the Virginia Employment Commission to Study the Filing Requirements for Unemployment Compensation Taxes
The Virginia Employment Commission will examine the process of reporting and paying unemployment compensation taxes for domestic and household employees in order to simplify the process. Technical assistance to be provided by TAX.
SJR 259: Joint Subcommittee Examining the Restructuring of the Electric Utility Industry (SJR 118 -1996)
The subcommittee will continue the study of potential restructuring changes in the electric utility industry and the impact on small businesses and residential consumers in the Commonwealth. TAX will participate as part of the staff task force which includes both public and private sector participants.
SJR 350: Establishing the Commission on the Commonwealth’s Planning and Budgeting Process
The commission will conduct a feasibility study of an integrated six year budget projection for major budget drivers for each functional area of government with each biennial budget. TAX will provide assistance upon request.
Executive Order Number Sixty-three (96) The Governor’s Commission on
Competitive and Equitable Tax Policy
The Commission will evaluate Virginia tax laws and the impact on the economic development of businesses and the personal financial security of individuals and families in Virginia. The Commission has been requested to study the advisability of reducing or eliminating the tangible personal property tax in the Commonwealth (SJR 385).
- INDEXES
INDEX - BY BILL NUMBER
BILL NO. CHAPTER SUBJECT MATTER PAGE
HB 1556 477 U. S. Olympic Committee Check-off 12
HB 1562 694 Definition of tax exempt organization 3
HB 1575 62 Tax on merchants selling bicentennial medals 39
HB 1576 63 Tax Amnesty program 31
HB 1643 717 Advertising and media related sales tax exemptions 25
HB 1665 696 Nonprescription drug and proprietary drug exemptions 26
HB 1712 71 Classification of pharmaceutical wholesalers’ inventory 41
HB 1725 15 Omnibus sales tax exemptions, various organizations 15,24,25
HB 1752 824 Broadcasting sales tax exemption 14
HB 1790 701 Distribution of land and tangible personal property book 43
HB 1837 244 Motor vehicles leased by auxiliary police officers 33
HB 1881 481 Local tax payment options 33
HB 1909 301 Elderly Transportation Fund Check-off 12
HB 1948 834 Space flight and launch activities sales tax exemption 14
HB 1961 704 Elderly and handicapped real property tax exemption 36
HB 1976 245 Distribution of local sales and use tax 27
HB 1988 705 Disclosure of confidential tax information, student loans 30
HB 2030 302 Housing Assistance Check-off 13
HB 2031 379 Local enterprise zones 43
HB 2041 838 Gross receipts from charitable gaming activities 40
HB 2049 180 Third party tax payment agreements 43
HB 2100 77 Food processing machinery and tool class eliminated 41
HB 2119 846 Recording satisfaction of tax payment agreements 45
HB 2141 849 Environmental restoration sites 38
HB 2159 283 Gross receipts of motor carriers and other carriers 40
HB 2177 250 Antique motor vehicle, household goods exemption 33
HB 2183 852 Major Business Facility Job Tax Credit 7
HB 2187 251 License tax assessment appeals statute of limitations 39
HB 2188 252 Effective date for local consumer utility tax rate changes 41
HB 2222 254 Proration of estate tax, penalty and interest 29
HB 2265 861 Virginia Higher Education Tuition Trust Fund 10
HB 2275 724 Judicial sales of real property 36
HB 2314 457 Programmable computer equipment and peripherals 34
HB 2316 725 Correction of errors in local sales tax distribution 26
HB 2326 396 Family and Children’s Trust Fund of Virginia Check-off 12
HB 2352 257 Declarations of estimated tax 9
HB 2355 184 Tax credits for rent reductions 9
HB 2363 398 Notice to lessees of motor vehicles 34
HB 2364 496 Local revenue collection statute changes 44
HB 2367 726 Worker Retraining Tax Credit 4
INDEX - BY BILL NUMBER
BILL NO. CHAPTER SUBJECT MATTER PAGE
HB 2372 497 Enterprise zone eligibility 5
HB 2439 872 Elderly and handicapped property tax exemption 37
HB 2447 732 BPOL tax requirements 39
HB 2448 873 Cotton Tax 29
HB 2482 877 Definition of watercraft, watercraft sales and use tax 28
HB 2484 878 Virginia Arts Foundation Check-off 13
HB 2551 287 Major league baseball stadium admissions tax 42
HB 2552 884 Virginia Baseball Stadium Authority 2
HB 2558 192 Fair market value for local taxes 35
HB 2563 735 Technical correction to Ruritan Club sales tax exemption 25
HB 2589 890 Chesapeake Bay Restoration Fund Check-off 13
HB 2609 229 Neighborhood Assistance Act 4, 10
HB 2611 764 Transient Occupancy Tax 42
HB 2741 554 Hampton Roads Sports Authority 2
HB 2783 903 BPOL, fees and gross receipts tax 40
HB 2846 756 Virginia Coal Employment and Production Incentive 8
HB 2859 909 Deduction for bone marrow screening fee 9
HB 2882 669 Enterprise zone definition of “permanent full time” 5
HB 2900 193 Payment of taxes by electronic funds transfer 31
HB 2906 428 Appeal for correction of assessment 30
HJR 532 n/a Commission on State and Local Government Responsibility
and Taxing Authority 48
SB 690 306 Enhanced Emergency Telephone Service Tax 42
SB 697 350 Vehicle emissions testing equipment tax credit 8
SB 705 307 Advertising and media related sales tax exemptions 25
SB 706 101 Food for free distribution at educational institutions 24
SB 709 631 Omnibus sales tax exemptions, various organizations 15,24
SB 804 634 Enterprise zone definition of “permanent full time” 6
SB 819 314 Local enterprise zone development 43
SB 820 517 Enterprise Zone Act revision 5
SB 831 106 Gains on sales of certain government obligations 5,9
SB 837 757 Transient Occupancy Tax 42
SB 880 168 Technology Zone maximum acreage 45
SB 891 785 Virginia Higher Education Tuition Trust Fund 10
SB 842 710 Elderly and handicapped real estate tax exemption 37
SB 914 786 Major Business Facility Job Tax Credit 7
SB 920 640 Neighborhood Assistance Act 4, 11
SB 921 355 Separating income tax refunds for divorced spouses 10
SB 929 787 Disclosure of confidential tax information 30
INDEX - BY BILL NUMBER
BILL NO. CHAPTER SUBJECT MATTER PAGE
SB 1019 276 Virginia Regional Industrial Facilities Act 45
SB 1119 808 Enterprise Zone Act 5,10
SB 1120 327 Proceeds from real estate tax lien sales 37
SJR 258 n/a Unemployment compensation tax filing requirements 48
SJR 259 n/a Restructuring of the electric utility industry 48
SJR 350 n/a Commission on planning and budgeting process 48
INDEX - BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
3.1-1081-1103 HB 2448 Cotton Tax 29
6.1-330.55 HB 2049 Third party tax payment agreements 43
15.1-227.70-85 HB 2552 Virginia Baseball Stadium Authority 2
15.1-1688-1709 HB 2741 Hampton Roads Sports Authority 2
15.1-1706-1722 SB 1019 Virginia Regional Industrial Facilities Act 45
18.2-340.32 HB 2041 Gross receipts from charitable gaming activities 40
29.1-712-717 HB 2482 Definition of watercraft, watercraft sales & use tax 28
46.2-755 HB 2364 Local revenue collection statute changes 44
58.1-1 HB 1562 Definition of tax exempt organization 3
58.1-3 SB 820 Enterprise Zone Act revision 6
HB1988 Disclosure of confidential tax information 30
SB 929 Disclosure of confidential tax information 30
58.1-22 HB 2364 Local revenue collection statute changes 44
58.1-202.1 HB 2900 Payment of taxes by electronic funds transfer 31
58.1-322 SB 831 Gains on sale of certain government obligations 5,9
HB 2859 Deduction for bone marrow screening fee 9
HB 2265 Virginia Higher Education Tuition Trust Authority 10
58.1-333 SB 920 Neighborhood Assistance Act 4,11
58.1-339 HB 2355 Tax credits for rent reductions 9
58.1-346.1:1 HB 1556 U. S. Olympic Committee Check-off 12
58.1-346.2:1 HB 2030 Housing Assistance Check-off 13
58.1-346.3:1 HB 2326 Family and Children’s Trust Fund Check-off 12
58.1-346.4:1 HB 1961 Elderly Transportation Fund Check-off 12
58.1-346.6 HB 2484 Virginia Arts Foundation Check-off 13
HB 2589 Chesapeake Bay Restoration Fund Check-off 13
58.1-526 HB 2364 Local revenue collection statute changes 44
58.1-402 SB 831 Gains on sale of certain government obligations 5,9
58.1-430 SB 920 Neighborhood Assistance Act 4,11
58.1-438.1 SB 697 Vehicle emissions testing equipment tax credit 8
58.1-439 SB 914 Major Business Facility Job Tax Credit 7
HB 2183 Major Business Facility Job Tax Credit 7
58.1-439.6 HB 2367 Worker Retraining Tax Credit 4
58.1-490 HB 2352 Declarations of estimated tax 9
58.1-499 SB 921 Separating income tax refunds of divorced spouses 10
58.1-605 HB 2316 Correction of errors in local sales tax distribution 26
HB 1976 Distribution of local sales and use tax 27
58.1-609.3 HB 1948 Space flight and launch activities 14
58.1-609.4 HB 1725 Educational sales tax exemptions 15,25
INDEX - BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
58.1-609.4(2)(1) HB 1725 Nonprofit school sales tax exemptions 24
58.1-609.6 HB 1725, Broadcasting sales tax exemptions
1752, 1643 14,25
58.1-609.7 HB 1725 Medical sales tax exemptions 16
51.8-609.7 HB 1665 Nonprescription and proprietary drugs 26
58.1-609.8 HB 1725 Civic and community sales tax exemptions 17,23
58.1-609.8(32) HB 1725, Nonprofit, Ruritan Club sales tax exemptions
2563 25
58.1-609.9-10 HB 1725 Cultural and miscellaneous sales tax exemptions 22-24
58.1-1401-10 HB 2482 Definition of watercraft 28
58.1-1822 HB 2906 Appeal for correction of assessment 30
58.1-1840 HB 1576 Tax Amnesty Program 31
58.1-2626.1 HB 2846 Virginia Coal Employment and Production Incentive 8
58.1-3018 HB 2049 Third party tax payment agreements 43
58.1-3128 HB 2364 Local revenue collection statute changes 44
58.1-3018 HB 2119 Recording satisfaction of tax payment agreements 45
58.1-3118 HB 1790 Distribution of land and personal property book 43
58.1-3211 HB 1961 Elderly and handicapped real property tax exemption 36
HB 2439 Elderly and handicapped real property tax exemption 37
58.1-3211-13 SB 842 Elderly and handicapped real property tax exemption 37
58.1-3245.6-.11 SB 819 Local Enterprise Development Zone 43
58.1-3310 HB 1790 Distribution of land and personal property book 43
58.1-3503-06 HB 2177 Antique motor vehicle, household goods exemption 33
HB 2558 Fair market value for local taxes 35
HB 2314 Programmable computer equipment an peripherals 34
58.1-3506 HB 1837 Motor vehicles leased by auxiliary police officers 33
58.1-3508 HB 2100 Food processing machinery and tool class eliminated 41
58.1-3510.01 HB 1712 Classification of pharmaceutical wholesalers’ inventory 41
58.1-3516.2 HB 2363 Notice to lessees of motor vehicles 34
58.1-3664 HB 2141 Environmental restoration sites 38
58.1-3703 HB 2783 BPOL, fees and gross receipts tax 40
HB 2159 Gross receipts of motor and other carriers 40
HB 1575 Tax on merchants selling bicentennial medals 39
58.1-3703.1 HB 2447 BPOL tax requirements 39
58.1-3812 HB 2188 Local consumer utility tax rate changes 41
58.1-3813 SB 690 Enhanced Emergency Telephone Service Tax 42
58.1-3817-18 HB 2551 Major league baseball stadium admissions tax 42
58.1-3819 HB 2611 Transient Occupancy Tax 42
58.1-3850 SB 880 Technology zones maximum acreage 45
58.1-3916 HB 1881 Local tax payment options 33
58.1-3916-28 HB 2364 Local revenue collection statute changes 44
INDEX - BY CODE SECTION
VA. CODE § BILL NO. SUBJECT MATTER PAGE
58.1-3965-69 HB 2275 Judicial sales of real property 36
58.1-3967 SB 1120 Proceeds from real estate tax lien sales 37
58.1-3984 HB 2187 License tax assessment appeals statute of limitations 39
59.1-271 SB 820 Enterprise Zone Act revision 6
59.1-274 HB 2031 Local enterprise zones 43
59.1-274,279 SB 1119 Enterprise Zone Act 5,10
59.1-279 HB 2372 Enterprise zone eligibility 5
59.1-279-282.4 SB 820 Enterprise Zone Act revision 6
59.1-280,281 HB 2882, SB 804 Enterprise Zone position definition 5
59.1-283 SB 819 Local Enterprise Development Zone 43
63.1-320-325 HB 2609 Neighborhood Assistance Act 4,11
64.1-161 HB 2222 Proration of estate tax, penalty, and interest 29
TABLE OF CONTENTS
STATE TAX LEGISLATION 1
GENERAL PROVISIONS 2
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- Virginia Baseball Stadium Authority 2
Hampton Roads Sports Facility Authority 2
Definition of Tax-Exempt Organizations 3
- Virginia Baseball Stadium Authority 2
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INCOME TAX 4
CORPORATIONS
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- Worker Retraining Tax Credit 4
Neighborhood Assistance Act 4
Subtraction for the Gains on the Sale of Certain Government Obligations. 5
Enterprise Zone Eligibility 5
Enterprise Zone Definition of “Permanent Full-Time Position” 5
Enterprise Zone Act Revision 5
Major Business Facility Job Tax Credit 7
Tax Credit for Vehicle Emissions Testing Equipment 7
Virginia Coal Employment and Production Incentive Tax Credit 8
- Worker Retraining Tax Credit 4
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- Deduction for Bone Marrow Screening 9
Declarations of Estimated Tax 9
Tax Credits for Rent Reductions 9
Subtraction for the Gains on the Sale of Certain Government Obligations 9
Separating Refunds for Divorced Spouses 10
Virginia Higher Education Tuition Trust Fund 10
Neighborhood Assistance Act 10
U.S. Olympic Committee Check-off 11
Family and Children’s Trust Fund of Virginia Check-off 11
Elderly Transportation Fund Check-off 12
Housing Assistance Check-off 12
Virginia Arts Foundation Check-off 12
Chesapeake Bay Restoration Fund Check-off 12
- Deduction for Bone Marrow Screening 9
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RETAIL SALES & USE TAX 14
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- Broadcasting Exemption 14
Space Flight and Space Launch Activities 14
Various Nonprofit and Miscellaneous Organizations 15
Exemption for Purchases for Use or Consumption 15
Educational 15
Medical-related 16
Civic and community service 17
Cultural 22
Miscellaneous 22
Purchases or Sales 23
Civic and Community services 23
Cultural 23
Miscellaneous 23
Sales Only 23
Miscellaneous 23
Other Transactions 24
Cultural 24
Miscellaneous 24
Expand Current Exemption for Nonprofit Schools: 24 Technical Corrections 25
Nonprofit Organization Exemption 25
Advertising and Media Related 25
Nonprescription Drugs and Proprietary Medicines 26
Correction of Errors in Local Sales Tax Distribution 26
Distribution of Local Sales and Use Tax 27
- Broadcasting Exemption 14
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MISCELLANEOUS TAXES 28
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- Watercraft Sales and Use Tax 28
Definition of Watercraft 28
- Watercraft Sales and Use Tax 28
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Estate Tax 29
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- Proration of Estate Tax Penalty and Interest 29
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Cotton Tax 29
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- Creation of Cotton Tax 29
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TAX COLLECTION & ADMINISTRATION 30
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- Disclosure of Confidential Tax Information: Student Loans 30
Tax Commissioner: Appeal for Correction of Assessment 30
Payment of Taxes by Electronic Funds Transfer 31
Tax Amnesty Program 31
- Disclosure of Confidential Tax Information: Student Loans 30
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LOCAL TAX LEGISLATION 32
TANGIBLE PERSONAL PROPERTY 33
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-
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- Payment Options 33
Classification for Antique Motor Vehicles; Exemption of Household Goods and Personal Effects 33
Programmable Computer Equipment and Peripherals 34
Notice to Lessees of Motor Vehicles 34
Determining Fair Market Value; Assessment Ratios 35
- Payment Options 33
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REAL ESTATE TAX 36
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- Maximum Net Financial Worth of the Elderly and Handicapped 36
Judicial Sale of Real Property 36
Exemption for the Elderly and Handicapped: Total Combined Income 36
Exemption for the Elderly and Handicapped: Definition of Income 37
Disposition of Surplus Proceeds from Real Estate Tax Sales 37
Environmental Restoration Sites 37
- Maximum Net Financial Worth of the Elderly and Handicapped 36
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BUSINESS, PROFESSIONAL, OCCUPATIONAL AND LICENSE TAX 38
Statute of Limitations for Appealing License Tax Assessments 38
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- Business, Professional, Occupational License Tax Requirements 38
Business, Professional, Occupational License Fee and Tax 39
Gross Receipts From Charitable Gaming Activities 39
Gross Receipts of Motor Carriers and Other Carriers 39
- Business, Professional, Occupational License Tax Requirements 38
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MISCELLANEOUS TAXES 40
Merchants’ Capital Tax 40
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- Classification for Inventory of Pharmaceutical Wholesalers 40
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Machinery and Tools Tax 40
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- Elimination of Classification for Machinery and Tools Used in Food Processing 40
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Consumer Utility Tax 40
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- Effective Date for Rate Changes 40
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Enhanced Emergency Telephone Service Tax 41
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- Recovery of Operational Costs 41
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Transient Occupancy Tax 41
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- Augusta, Caroline, James City, Page, and Tazewell Counties Allowed to Impose Maximum 5% Tax 41
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Admissions Tax 41
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- County with a Major League Baseball Stadium 41
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TAX COLLECTION & ADMINISTRATION 42
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- Local Enterprise Development Zone 42
Local Enterprise Zones 42
Distribution of Land and Tangible Personal Property Book 42
Third Party Tax Payment Agreements: Mortgage Loan Agreements Prohibited 42
Technical Corrections and Changes to Local Revenue Collection Statutes 43
- Local Enterprise Development Zone 42
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- Technology Zones Maximum Acreage 44
Recording Satisfaction of Tax Payment Agreements 44
Virginia Regional Industrial Facilities Act 45
- Technology Zones Maximum Acreage 44
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LEGISLATIVE STUDIES 46
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- HJR 532: The Commission on State and Local Government Responsibility and Taxing Authority (HJR 108 -1996) 47
SJR 258: Requesting the Virginia Employment Commission to Study the Filing Requirements for Unemployment Compensation Taxes 47
- HJR 532: The Commission on State and Local Government Responsibility and Taxing Authority (HJR 108 -1996) 47
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-
-
-
-
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- SJR 350: Establishing the Commission on the Commonwealth’s Planning and Budgeting Process 47
Executive Order Number Sixty-three (96) The Governor’s Commission on Competitive and Equitable Tax Policy 47
- SJR 350: Establishing the Commission on the Commonwealth’s Planning and Budgeting Process 47
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INDEXES 48
INDEX - BY BILL NUMBER 49
INDEX - BY CODE SECTION 55
Legislative Summaries