Tax Type
Recordation Tax
Description
Public Utility Transfers
Topic
Exemptions
Date Issued
09-23-1987
September 23, 1987
Dear ********************
This is in response to your letter of June 4, 1987, requesting a ruling that certain deeds are exempt from the state recordation tax although the local recordation tax may be imposed.
The taxpayer is a public utility which has received permission from the State Corporation Commission (S.C.C.) to exchange an undivided fractional interest in its utility assets for an undivided fractional interest in the utility assets of another public utility.
The exchange will require that deeds be recorded in a number of Virginia localities. The taxpayer has requested a ruling that the deeds to effect this exchange are exempt from any state recordation tax under §58.1-801 et seq.
The Utilities Transfer Act, §56-88 et seq., provides that a public utility must obtain the approval of the S.C.C. prior to the acquisition or disposition of utility assets. The act also provides that no state recording tax shall be payable upon the admission to record of any deed which conveys utility assets to another public utility; however, the act expressly provides that local recording taxes shall be payable as though the state recording taxes had been collected. §56-90.1.
Accordingly, I am of the opinion that the above referenced conveyance may be admitted to record without payment of any state recordation tax imposed by §§58.1-801 or 58.1-802 (including the portion of the tax under §58.1-802 normally retained by the locality).
Each city or county may collect a local recordation tax imposed by local ordinance, as authorized by §§58.1-814 and 58.1-3800, as if the state tax under §58.1-801 had been charged.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner