Document Number
89-211
Tax Type
General Provisions
Description
1989 LEGISLATIVE SUMMARY
Topic
Reports
Date Issued
06-01-1989
1989
LEGISLATIVE
SUMMARY

VIRGINIA DEPARTMENT
OF TAXATION

INTRODUCTION

Generally

The Legislative Summary is a new publication of the Department of Taxation. The Summary replaces the Legislative Digest and the tax bulletins that have been used in previous years to announce changes in state and local tax laws.

The Summary is intended to serve as a convenient reference guide to state and local tax legislation enacted by the 1989 Regular and Special Sessions of the General Assembly. The Summary includes a general description of legislation affecting:
  • State taxes administered by the Department of Taxation, and
  • Local taxes for which the Department of Taxation renders advisory assistance.

    Bills granting property tax exemptions, granting taxing authority through local charters, creating special taxing districts, or affecting state taxes administered by other agencies are not included in the Summary.

    Organization of the Summary

    The Legislative Summary is divided into three parts:
  • Part I summarizes the most significant tax legislation enacted in 1989, including the April 24 - 27, 1989 Special Session;
  • Part II summarizes other state tax legislation; and
  • Part III summarizes local tax legislation.

    Questions Relating to Legislation

    The Legislative Summary is intended only to provide an overview of 1989 legislation. More specific information on the major legislation discussed in Part I will be contained in regulations to be published by the Department of Taxation under the Administrative Process Act.

    Anyone having questions about any new legislation affecting state taxes may obtain assistance from the Department of Taxation at the following telephone numbers:
    • Individual Income Tax (804) 367-8031
      Corporation Income Tax (804) 367-8036
      Sales and Use Tax (804) 367-8037
    We hope that this new publication will provide more timely and complete information to you in a more usable form. If you have any comments or suggestions for improvement, please do not hesitate to let us know.
    Virginia Department of Taxation
    June 1989

    TABLE OF CONTENTS

    SUBJECT PAGE

    Part 1 - Major Legislation 1

    Virginia Tax Reform Plan of 1989 2
    Retirement Income Subtraction 4
    Local Income Tax 7
    Tax Amnesty Program 8
    Sales and Use Tax Dealer's Discount 9
    Sales and Use Tax Expenditure Study 10
    Tire Tax 10
    Withholding Exemptions 10

    Part II - Other State Tax Legislation 11

    Income Tax 12
    Low Income Housing Credit 12
    Qualified Agricultural Contributions 12
    Neighborhood Assistance Act 12
    Statute of Limitations for Refunds 12
    Memorandum of Lien 12
    Set-Off Debt Collection 12

    Sales and Use Tax 13
    Printed Materials for Use Outside Va. 13
    Rabbit Farming 13
    Low-Cost Housing Organizations 13
    Campground Memberships 13
    Suspension of Exemptions 13
    Exemptions for Nonprofit Organizations 14
    Day Care Centers and Preschools 14
    Public Library and Recreation Ctrs 14
    High Blood Pressure Center 14
    Athletic Associations 14
    Shelters for the Homeless 14
    Travel Guides for Handicapped 14
    Memorial to Former Chief Justice 15
    Black History Museum 15
    Live Music Performances 15
    Boy and Girl Scout Exemptions 15
    Public Park and Botanical Garden 15
    Ecological Organizations 15
    Cultural Organizations 16
    Public Libraries 16
    Tissue Bank 16

    Recordation Tax-Distribution of State Revenues 16
    Bank Franchise Tax - Proration for New Banks 16

    Tax on Wills and Administration (Probate) 17
    Increase Threshold of Taxable Estate 17
    Increase Threshold for Refund or Billing 17
    Corn Assessment - Rate Increase 17
    Motor Vehicle Fuel Sales Tax 17
    Disclosure of Information 17
    Disposition of Tax Revenues 17
    Information Sharing 17

    Part III - Local Tax Legislation 19

    General 20
    Interest on Prepayment of Local Taxes 20
    Interest on Delinquent Local Taxes 20
    Correction of Erroneous Assessments 20

    License Taxes 20
    Businesses Operated by Blind Persons 20
    Coal and Gas Road Improvement Tax 20
    Coal and Gas Road Improvement Advisory 20
    Committee

    Property Taxes 21
    Daily Rental Property Tax 21
    Tax Relief for Elderly and Handicapped 21
    Rehabilitated Real Estate 22
    Tax Increment Financing 22
    Use-Value Assessment 22
    Volunteer Fire and Rescue Squad Members 22
    Transportation of Physically Handicapped 22
    Collection of Tax Bills Less Than $5 22
    Proration 23
    Boards of Equalization 23
    Review of Real Estate Assessments 23
    Farm Clubs Associations 23
    Publication of Value of Exempt Real Estate 23


    PART I
    MAJOR LEGISLATION

    Virginia Tax Reform Plan of 1989


    House Bill 1417 (Chapter 590) provides a sliding scale nonrefundable credit against the individual income tax for each personal and dependent exemption allowable to a taxpayer.
  • For taxable year 1989, the maximum credit is $35:
      • Single individuals or married individuals filing separate returns with Virginia adjusted gross income (VAGI) of $17,000 or less will receive the full $35 credit. The $35 credit will be reduced by $2 for each $1,000 of VAGI in excess of $17,000 for these taxpayers. The credit is reduced to $0 once VAGI exceeds $34,000.
      • Married individuals filing jointly or separately on a combined return with combined VAGI of $34,000 or less will receive the full $35 credit. The credit will be reduced by $1 for each $1,000 of VAGI in excess of $34,000 and is reduced to $0 once VAGI exceeds $68,000.

    No credit of less than $1 will be allowed in taxable year 1989.
  • For taxable years 1990 - 1993, the maximum credit is $22.50:
      • Single individuals or married individuals filing separate returns with VAGI of $10,000 or less will receive the full $22.50 credit. The credit will be reduced by $4 for each $1,000 of VAGI in excess of $20,000 and will be reduced to $0 once VAGI exceeds $15,000.
      • Married individuals filing jointly or separately on a combined return with combined VAGI of $24,000 or less will receive the full $22.50 credit. The credit will be reduced by $2 for each $1,000 of VAGI in excess of $24,000 and will be reduced to $0 once VAGI exceeds $34,000.
      • Credits will not be provided after taxable year 1993.

    EFFECTIVE DATE: Taxable years beginning on and after January 1, 1989

    CODE SECTION AFFECTED: 58.1-335





    SCHEDULE OF 1989 CREDIT

    EXAMPLE OF A $35 NONREFUNDABLE CREDIT PER PERSONAL AND DEPENDENT EXEMPTION

    FULL CREDIT: IF SINGLE AND INCOME IS LESS THAN $17,000,
        • IF MARRIED AND INCOME IS LESS THAN $34,000
    CREDIT IS PHASED OUT: FOR INCOMES BETWEEN $17,000 & $34,000 IF SINGLE,
            • FOR INCOMES BETWEEN $34,000 & $68,000 IF MARRIED

              • SINGLE MARRIED
                CREDIT CREDIT
    INCOME PER PER
    (VAGI) EXEMPTION EXEMPTION

    $4,000 $0.00 * $0.00 *
    $10,000 $35.00 $35.00
    $15,000 $35.00 $35.00
    $17,000 $35.00 $35.00
    $20,000 $29.00 $35.00
    $25,000 $19.00 $35.00
    $30,000 $9.00 $35.00
    $35,000 $0.00 $34.00
    $40,000 $0.00 $29.00
    $45,000 $0.00 $24.00
    $50,000 $0.00 $19.00
    $55,000 $0.00 $14.00


    * Taxpayer has no income tax liability because income is below filing threshold.



    Retirement Income Subtraction

    Senate Bill 1 (Chapter 3 - 1989 Special Session No. 2) provides a subtraction from federal adjusted gross income (FAGI) of up to $16,000 in computing the individual income tax of taxpayers age 55 and over.
  • If retirement income is $16,000 or less, the taxpayer may subtract his entire retirement income from FAGI, but
  • If retirement income is between $16,000 and $40,000, the taxpayer will receive a $16,000 subtraction reduced by $1 for every $3 of retirement income in excess of $16,000.
  • If retirement income is over $40,000, the taxpayer does not receive any subtraction.

    For taxpayers with retirement income between $16,000 - $40,000, the subtraction will be phased-in over a 3-year period:
  • In taxable year 1989, taxpayers will receive 50% of the subtraction computed – for example, a $15,000 subtraction would be reduced to $7,500.
  • In taxable year 1990, taxpayers will receive 75% of the subtraction computed - a $15,000 subtraction would be reduced to $11,250.
  • In taxable year 1991, taxpayers will receive 100% of the subtraction computed.

    Taxpayers with retirement income of $16,000 or less are not subject to the phase-in provisions - these taxpayers will receive a full subtraction beginning in taxable year 1989.

    For purposes of determining eligibility for and computing the subtraction, "retirement income" includes income from:
  • Qualified retirement plans under 401 of the Internal Revenue Code (IRC), such as
      • pension plans
      • employee stock ownership plans (ESOP's)
      • 401(k) or deferred compensation plans
      • Keogh Plans for self-employed individuals
      • Savings plans
      • Thrift plans
      • Stock bonus plans
      • savings plans
  • All public retirement plans, including the Virginia Supplemental Retirement System, Virginia local government retirement systems, the federal civil service and military retirement systems, and public retirement systems of other states.
  • Deferred compensation plans under I RC 457 for employees of state and local governments and tax-exempt organizations.

    Retirement plans under IRC 408, including

    individual retirement accounts individual retirement annuities
    employer sponsored IRA trusts simplified employee pension (SEP) plans
  • Annuities for purposes of IRC 403(a) or 403(b), such as the TIAA-CREF plan for university faculty members.

    "Retirement income" does not include Social Security benefits or Railroad Retirement System benefits.

    Senate Bill 1 also limits the current age credit, effective for taxable year 1989, to taxpayers:
  • with retirement income of $2,000 or less, or
    • who have no retirement income at all.

      Persons with $2,000 or less in retirement income may claim either the age credit or the new retirement income subtraction, but not both.

      The bill also:
    • retains the current subtraction for Social Security and Railroad Retirement benefits included in FAGI;
    • retains the additional personal exemption for taxpayers age 65 or over;
    • retains the $3,000 retirement income subtraction that will take effect in taxable year 1990 - this subtraction must be reduced by any Social Security or nontaxable retirement benefits received and may be claimed in addition to the new retirement income subtraction;
    • repealed the subtraction for Virginia state and local government retirement benefits, including benefits paid by the Virginia Supplemental Retirement System; and
    • repealed the subtraction for public retirement benefits paid by other states, which would have became effective for taxable year 1989 - this subtraction would have applied only to states which grant similar treatment to Virginia governmental retirees.
      • EFFECTIVE DATE: Taxable years beginning on and after January 1, 1989

        CODE SECTIONS AFFECTED: 51-111.15, 51-112, 51-127.7, 51-180, 58.1-322, and 58.1-330

      Statute of Limitations for Refunds

      Senate Bill 2 (Chapter 1 - 1989 Special Session No. 2) and House Bill 2 (Chapter 2 - 1989 Special Session No. 2) extend the statute of limitations for federal retirees to file amended returns for taxable years 1985 - 1988 due to the U. S. Supreme Court's decision in Davis v. Michigan. The bill will allow federal retirees up to one year from the final judicial order-not subject to further appeal that resolves application of Davis to the Virginia individual income tax law.
      • EFFECTIVE DATE: May 1, 1989

        CODE SECTION AFFECTED: 58.1-1823


      Retirement Income Schedule
      (Must Include Retirement Income of All Types)

      1989 1990 1991
      Retirement Subtraction Subtraction Subtraction
      Income Amount Amount Amount

      Below $16,000 Equal to Pension Equal to Pension Equal to Pension

      $16,000 $16,000 $16,000 $16,000
      $17,000 $7,834 $11,750 $15,667
      $18,000 $7,667 $11,500 $15,333
      $19,000 $7,500 $11,250 $15,000
      $20,000 $7,334 $11,000 $14,667

      $21,000 $7,167 $10,750 $14,333
      $22,000 $7,000 $10,500 $14,000
      $23,000 $6,834 $10,250 $13,667
      $24,000 $6,667 $10,000 $13,333
      $25,000 $6,500 $9,750 $13,000

      $26,000 $6,334 $9,500 $12,667
      $27,000 $6,167 $9,250 $12,333
      $28,000 $6,000 $9,000 $12,000
      $29,000 $5,834 $8,750 $11,667
      $30,000 $5,667 $8,500 $11,333

      $31,000 $5,500 $8,250 $11,000
      $32,000 $5,334 $8,000 $10,667
      $33,000 $5,167 $7,750 $10,333
      $34,000 $5,000 $7,500 $10,000
      $35,000 $4,834 $7,250 $9,667

      $36, 000 $4, 667 $7,000 $9,333
      $37,000 $4,500 $6,750 $9,000
      $38,000 $4,334 $6,500 $8,667
      $39,000 $4,167 $6,250 $8,333
      $40,000 $4,000 $6,000 $8,000

      Over $40,000 $0 $0 $0

      NOTE: Table reflects phased - in amounts of 50 percent for Taxable
      Year 1989 and 75 percent for Taxable Year 1990.

      Local Income Tax

      House Bill 1684 (Chapter 245) authorizes the cities of Alexandria, Fairfax, Falls Church, Manassas, Manassas Park, and Norfolk and the counties of Arlington, Fairfax, Loudoun, and Prince William to levy a local income tax on individuals and corporations, subject to the following limitations:
    • The tax may be levied at any increment of 1/4% up to a maximum rate of 1%, i.e., ¼%, ½%, ¾% or 1%.
    • The voters of the locality must authorize the adoption of the tax in a referendum before the tax may be levied.
    • The tax may be levied within a locality for a period of no more than 5 years; and
    • Total revenues from the tax must be expended for transportation purposes only. In addition, these revenues must be used to supplement, rather than replace, current transportation funding by the locality.

      If levied in a locality, the tax will apply to:
    • Any individual domiciled in the locality at any time during the taxable year or who maintains his place of abode in the locality for more than 183 days of the taxable year;
    • An estate or trust that is principally administered, managed, or directed from the locality, provided that the fiduciary is domiciled within the locality or maintains his place of abode there for more than 183 days of the taxable year; and
    • Any corporation with income from sources within the locality. Corporations with income from more than one locality generally must allocate and apportion their income using a 2-factor formula of property and payroll (dividends are allocable to the locality in which the corporation is headquartered). However, a corporation subject to a one-factor apportionment formula for state income tax purposes and which has income from more than one Virginia locality must use that same formula for purposes of the local income tax.

      The tax will be administered by the Department of Taxation in the same manner as the current individual and corporation income taxes, and subject to the same penalties and enforcement provisions as those taxes. Income tax withholding and estimated income tax filing requirements will also apply for purposes of the local income tax.

      The tax will become effective in a locality on January 1 of the year following the calendar year in which the ordinance levying the tax is adopted. A locality will be required, however, to notify the Department of Taxation within 30 days after the adoption of the ordinance and at least 30 days prior to the effective date of the tax. After adoption, the local governing body may change the tax rate or repeal the tax without a referendum. The effective date of the repeal or rate change will be January 1 of the year following the adoption of the ordinance, subject to the same notification requirements as an ordinance to levy the tax. After the tax becomes effective, it may remain in effect for a period of five taxable years.

      EFFECTIVE DATE: July 1, 1989

      CODE SECTIONS AFFECTED: 58.1-300, 58.1-520, and 58.1-540 - 58.1

      Tax Amnesty Program

      Senate Bill 732 (Chapter 642) and House Bill 1596 (Chapter 629) establish a state tax amnesty program of no more than 62 days to be conducted during the period from January 15 - March 31, 1990. The amnesty program will apply only to taxes administered by the Department of Taxation, including income, sales and use, and withholding taxes.

      Under the amnesty program, (1) all civil and criminal penalties will be waived for unknown nonfilers who come forward and (2) all civil penalties on outstanding assessments of more than 90 days old will be abated, provided that the tax and interest is paid in full.

      Additional information on the exact dates of the amnesty program and specifics of its operation will be available later in the year.

      This bill will also increase certain civil and criminal penalties effective for taxable year 1990:
    • Individual and corporation income tax late filing and payment penalties will be increased to 5% per month, up to a maximum penalty of 25% each. The penalty for failure to pay will not apply for any month in which the failure to file penalty has been imposed and the total penalties for late filing and payment shall not exceed 25% for any taxpayer.
    • In addition, a 100% corporation income tax fraud penalty will be added - this will be similar to the current fraud penalty for individuals.

      In addition, the Tax Commissioner is authorized, after the filing of a memorandum of lien, to place padlocks on the doors of any business that is seriously delinquent in the filing or payment of state taxes. If after three days the tax deficiency has not been satisfied or arrangements made for its payment, the Tax Commissioner is further authorized to cause the issuance of a writ of fieri facias. The padlock provisions may be enforced by the Department of Taxation only after the adoption of regulations under the Administrative Process Act setting forth the circumstances in which delinquent businesses can be padlocked.

      EFFECTIVE DATE: Taxable years beginning on and after January 1, 1990 (penalty and enforcement
      provisions)

      CODE SECTIONS AFFECTED: 58.1-347, 58.1-351, 58.1-450, 58.1-455, 58.1-1805, and 58.1-1840

      Sales and Use Tax Dealer's Discount

      Senate Bill 741 (Chapter 469) replaces the current flat dealer's discount (3% of the first 3% of the state tax) with a sliding scale discount of 4%, 3% or 2% of the first 3% of the state tax based upon the dealer's monthly taxable sales volume. The dealer's discount is the amount of state tax that a dealer may retain to offset his expenses of collecting and timely remitting the sales and use tax.

      To compute the dealer's discount, a dealer must multiply the 3'h% state tax listed on his return by the applicable dealer's discount rate below:

      If total monthly taxable sales are: Dealer's discount rate is:
      Less than $62,501 3.43% or.0343
      $62,501 but less than $208,001 2.57% or.0257
      Above $208,001 1.71 % or .0171

      In determining the applicable discount rate, a dealer must use total taxable sales for all of his business locations, even though he may file separate returns for each location. For example, a dealer with two business locations each with monthly taxable sales of $35,000 will use the 2.57% discount rate for both locations as his total taxable sales exceed $62,500.

      This bill will also change the dealer's discount rate for vending machine dealers who remit the sales tax based on 5 ½% of their wholesale purchases for resale:

      If total monthly taxable sales are: Dealer's discount rate is:
      Less than $62,501 3.56% or .0356
      $62,501 but less than $208,001 2.67% or. 0267
      Above $208,001 1.78% or .0178

      Also affected will be dealers who collect the 2% motor vehicle fuel sales tax in the Northern Virginia and Potomac and Rappahannock Transportation Districts:

      If total monthly taxable sales are: Dealer's discount rate is:
      Less than $62,501 4% or .04
      $62,501 but less than $208,001 3% or .03
      Above $208,001 2% or .02

      EFFECTIVE DATE: July 1, 1989

      CODE SECTION AFFECTED: 58.1-6

                    • Sales and Use Tax Expenditure Study

      Senate Bill 521 (Chapter 739) creates an ongoing study by the Secretary of Finance of sales and use tax exemptions.

      This bill combines all existing sales tax exemptions into Va. Code §58.1-608, and groups the exemptions by subject matter into ten categories. The Secretary of Finance will investigate and analyze on a continuing basis, the fiscal, economic and policy impact of each category of exemptions, and report his findings to the General Assembly on an annual basis. Two categories of exemptions will be studied each year. The first two categories, to be reported on in December 1989, are government and commodities exemptions and agricultural exemptions.

      In addition, the bill generally requires that any legislation providing a sales tax exemption be introduced no later than the first calendar day of the General Assembly session, and that the patron of the legislation submit information at that time based upon eight exemption criteria. A simple questionnaire has been developed for this purpose. The questionnaire will be furnished by the patron to the Division of Legislative Services, which is authorized to release the information to the Department of Taxation for use in the analysis of the legislation.
        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 30-19.05, 30-19.1:2, 58.1-602, 58.1-608, 58.1-608.1, and 58.1-610
        Tire Tax

        House Bill 1745 (Chapter 630) imposes a tax of 50 cents on the sale of every new tire in Virginia. The tax is imposed upon tire retailers, but may be collected from their customers at the time of sale.

        Exempted from the tax are tires for devices moved exclusively by human power, used exclusively upon stationary rails or tracks, or used exclusively for farming purposes, except for farm trucks.

        The tire tax will generally be subject to the provisions of the retail sales and use tax, except that all replacement truck tires will be subject to the tire tax. As compensation for collecting the tire tax, tire retailers may retain 5% of the tax collected, provided that the tax is not delinquent at the time of payment.

        EFFECTIVE DATES: January 1, 1990 through December 31, 1994

        CODE SECTIONS AFFECTED: 10.1-1422.1 and 58.1-640 - 644.
        Withholding Exemptions

        House Bill 1950 (Chapter 289) will allow employees to adjust their withholding to compensate for the difference between the standard deduction and itemized deductions. Employees who itemize deductions on their federal and Virginia income tax returns will be able to claim additional withholding exemptions for purposes of Virginia income tax withholding. The number of additional withholding exemptions will be based upon an employee's estimate of his or he(federal adjusted gross income, itemized deductions, Virginia additions and subtractions, and Virginia tax credits. The Department of Taxation will distribute forms and instructions to employers before the January 1, 1991 effective date of this law change.

        EFFECTIVE DATE: January 1, 1991

        CODE SECTIONS AFFECTED: 58.1-461, 58.1-462, and 58.1-470

        PART II
        OTHER STATE TAX LEGISLATION
        Income Tax

        LOW INCOME HOUSING CREDIT:

        House Bill 1540 (Chapter 280) authorizes the Virginia Housing Development Authority (VHDA) to grant a credit against the individual and corporate income tax equal to a percentage of the federal low income housing credit allowed in the first 5 years after qualifying low income housing units are placed in service. The percentage allowed by the VHDA may be changed each year but the total of all credits allowed can not exceed $3.5 million annually. There will be a recapture of the Virginia credits if federal credits are later recaptured.

        EFFECTIVE DATE: Taxable years beginning on and after January 1, 1990.

        CODE SECTIONS AFFECTED: 36-55.63, 58.1-336, and 58.1-435

        QUALIFIED AGRICULTURAL CONTRIBUTIONS:

        Senate Bill 464 (Chapter 639) and House Bill 1382 (Chapter 39) provide a deduction to farmers (individuals and corporations) who donate agricultural products to nonprofit organizations that are exempt from taxation under IRC 501 (c) (3). This bill restores an identical deduction that expired after taxable year 1987.

        The deduction is based upon the lowest wholesale market price of the agricultural product in the nearest regional market during the month in which the contribution is made. The Department of Taxation has previously set forth guidelines for computing the deduction in Virginia Regulations 630-2-322 (individual income tax) and 630-3-402 (corporation income tax).

        EFFECTIVE DATES: Taxable years beginning on and after January 1, 1989 but before January 1, 1994

        CODE SECTIONS AFFECTED: 58.1-322, 58.1-322.2, and 58.1-402

        NEIGHBORHOOD ASSISTANCE ACT:

        House Bill 1541 (Chapter 310) extends the sunset date for the Neighborhood Assistance Act tax credit for individuals and corporations by five years to June 30, 1995. This bill also expands the definition of qualified "neighborhood organizations" for purposes of the credit to include public housing authorities.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 63.1-321, 63.1-323, and 63.1-324

        STATUTE OF LIMITATIONS FOR REFUNDS:

        Senate Bill 10 (Chapter 6 - 1989 Special Session No. 2) extends the statute of limitations for retirees of the Washington Metropolitan Area Transit Authority (WMATA) to file amended 1985 individual income tax returns until May 1, 1990. As WMATA is deemed to be an agency of the Commonwealth of Virginia, this would enable retired employees of the authority to file amended returns for taxable year 1985 to claim the subtraction for Virginia state and local government retirement benefits.

        EFFECTIVE DATE: January 1, 1989

        CODE SECTION AFFECTED: §58.1-1823

        MEMORANDUM OF LIEN:

        House Bill 406 (Chapter 263) limits the period in which the Department of Taxation to six years from the date of assessment in which to record a memorandum of lien for the collection of income taxes. This bill does not affect other collection methods or the use of memorandums of lien to collect other taxes.
        EFFECTIVE DATE: October 1, 1989

        CODE SECTION AFFECTED: 58.1-313

        SET-OFF DEBT COLLECTION:

        House Bill 1227 (Chapter 77) makes a technical correction to the Set-off Debt Collection Act to clarify that debtors who have debts reduced to judgment may be included in the program and to eliminate special accounting provisions for interest paid as a result of errors in the set-off program.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-520 and 58.1-535

                          • Sales and Use Tax

        PRINTED MATERIALS FOR USE OUTSIDE VIRGINIA:

        Senate Bill 521 (Chapter 739) makes permanent the sales and use tax exemption for catalogs, letters, brochures, reports and similar printed materials (other than administrative supplies) stored in Virginia for 12 months or less and distributed for use outside of Virginia. This exemption would otherwise have sunset on June 30, 1990. Virginia Regulation 630-10-81 describes the types of printed materials that qualify for the exemption.

        RABBIT FARMING:

        Senate Bill 521 (Chapter 739) extends the sales and use tax agricultural exemption to rabbit and quail farmers. The agricultural exemption is limited to tangible personal property used in agricultural production for market, excluding structural construction materials. Rabbit and quail farmers may use Form ST-18, the agricultural exemption certificate, in making exempt purchases from suppliers.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-608

        LOW-COST HOUSING ORGANIZATIONS:

        Senate Bill 521 (Chapter 739) authorizes a nonprofit low-cost housing organization to apply for a refund of sales and use tax paid on building materials by contractors for the organization or by the organization itself. Refunds will be available to an organization that is organized and operated primarily to acquire land and purchase materials to erect or rehabilitate low-cost homes on such land for sale at cost on a nondiscriminatory basis to persons who otherwise would be unable to afford to buy a home through conventional means.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1993

        CODE SECTIONS AFFECTED: 58.1-608 and 58.1-608.1
        CODE SECTIONS AFFECTED: 58.1-608 and 58.1-608.1

        CAMPGROUND MEMBERSHIPS:

        Senate Bill 670 (Chapter 581) defines the term "transient" to exclude the purchaser of camping memberships, time-shares, condominiums, or similar contracts or interests that permit the use of, or constitute an interest in, real estate, effectively excluding such purchases from the tax. This bill also exempts from the sales and use tax, the purchase of any right or license which entitles the purchaser to the use of certain amenities and facilities of a real estate project on an ongoing basis, provided the term or time period involved is seven years or more.

        With the exception of campground memberships, these transactions have generally not been considered subject to the retail sales and use tax. While this bill will be retroactive to January 1, 1985, refunds of tax previously paid on campground memberships will remain subject to the 3-year statute of limitations prescribed in Va. Code §58.1-1823, i.e., refund' requests must be filed within three years of the date the tax became due.

        EFFECTIVE DATE: July 1, 1989, retroactive to January 1, 1985

        CODES SECTION AFFECTED: 58.1-602

        SUSPENSION OF EXEMPTIONS:

        House Bill 647 (Chapter 12) authorizes the Tax Commissioner to suspend for up to one year the exemption of any person who misuses an exemption certificate, after giving such person 10 days written notice requiring him to show cause why the exemption should not be suspended. In the case of gross misuse of an exemption certificate, the Tax Commissioner is authorized to issue a report on the taxpayer to the Secretary of Finance and the General Assembly.

        In lieu of suspension, the Tax Commissioner may assess a penalty of up to $1,000 for misuse of the certificate. Whenever the Tax Commissioner determines that a person has misused an exemption certificate, that person will become liable for the tax, and any interest thereon, on any purchases improperly made with the certificate.

        In the event that an exemption is suspended, the person holding the exemption must pay the tax at the time of purchase and request a refund from the Department of Taxation for the amount of tax paid. Interest will not be paid on such refunds. A person who knowingly uses or gives an exemption certificate during the period of suspension will be guilty of a Class 1 misdemeanor.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-623.1

        EXEMPTIONS FOR NONPROFIT ORGANIZATIONS:

        Senate Bill 521 (Chapter 739) provides exemptions from the sales and use tax to several nonprofit organizations:

        Day Care Centers and Preschools:

        Nonprofit organizations organized primarily to operate a state-licensed day care center or a preschool are exempted from the tax, provided that the organization (1) hires only certified public school teachers, and (2) has a regularly prescribed curriculum. This exemption applies only to nonprofit preschools and day care centers that meet these two tests; however, preschools and day care centers owned and operated by churches, nonprofit colleges and universities, and government agencies generally are exempt from the tax under current law. Qualifying day care centers and preschools may use the sales and use tax exemption certificate, Form ST-13 in making exempt purchases from suppliers.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1991

        CODE SECTION AFFECTED: 58.1-608

        Public Library and Recreation Center:

        A nonprofit corporation which operates a county public library which is also used as a recreational center for county residents is exempted from the tax. Senate Bill 127 (Chapter 732) will exempt all nonprofit public libraries from the tax. At least one organization, The Heritage Foundation Library, will qualify for this exemption. A special exemption certificate will be developed for use by this and similar organizations when making exempt purchases from suppliers.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1991

        CODE SECTION AFFECTED: 58.1-608

        High Blood Pressure Center:

        A nonprofit high blood pressure center is exempted from the tax, provided that the property it purchases is used exclusively to provide medical assistance to indigent persons diagnosed with hypertension. At least one organization, the Richmond Area High Blood Pressure Center, will qualify for this exemption. A special exemption certificate will be developed for use by this organization and any similar organizations that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1993

        CODE SECTION AFFECTED: 58.1-608

        Athletic Associations:

        Nonprofit organizations which are organized exclusively to foster, sponsor and promote physical education, athletic programs and contests for youths in the Commonwealth are exempted from the tax, provided that the organization also enjoys an exemption from local real estate taxes. A special exemption certificate will be developed for use by organizations qualifying for this exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1993

        CODE SECTION AFFECTED: 58.1-608

        Shelters for the Homeless:

        Shelters for homeless individuals operated by a nonprofit organization, or by a nonprofit organization organized exclusively to provide food, shelter, clothing or other items to homeless persons in the Commonwealth are exempted from the tax. A special exemption certificate will be developed for use by shelters qualifying for this exemption.

        EFFECTIVE DATES: July 1,1989 through July 1, 1993

        CODE SECTION AFFECTED: 58.1-608

        Travel Guides for Handicapped Travellers:
        -
        A nonprofit organization organized to prepare and publish a free travel guide for handicapped travelers is exempted from the tax. At least one organization, The Opening Door, Inc., will qualify for this exemption. A special exemption certificate will be developed for use by this organization and any others that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1993

        CODE SECTION AFFECTED: 58.1-608

        Memorial to Former Chief Justice:

        A nonprofit organization organized to promote a permanent memorial to a former Chief Justice of the United States Supreme Court is exempted from the tax. The only organization qualifying for this exemption is the John Marshall House. A special exemption certificate will be developed for use by this organization.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1994

        CODE SECTION AFFECTED: 58.1-608

        Black History Museum:

        A nonprofit museum which commemorates and preserves in a central repository, the culture and history of black people in Virginia through a collection of memoirs, artifacts, displays, exhibits and other related historical data is exempted from the tax. At least one organization, the Black History Museum Cultural Center of Virginia, Inc., will qualify for this exemption. A special exemption certificate will be developed for use by this museum and any others that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1994

        CODE SECTION AFFECTED: 58.1-608

        Live Music Performances:

        A nonprofit organization operated exclusively for educational and charitable purposes to promote the study, performance and public awareness of music by presenting live music performances to youths and family groups is exempted from the tax, provided the organization receives funding annually from at least three local governments in Virginia and from the Virginia Commission for the Arts, and charges no fees for children to attend the music performances. At least one organization, the Williamsburg Symphonia, will qualify for this exemption. A special exemption certificate will be developed for use by this organization and any other organizations that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1994

        CODE SECTION AFFECTED: 58.1-608

        Boy and Girl Scout Organizations:

        House Bill 249 (Chapter 585) exempts from the sales and use tax, tangible personal property purchased for use or consumption by, or sold at retail by, nonsectarian youth organizations exempt from taxation under IRC 501 (c) (3), provided such organizations are organized for the character development and citizenship training of their members, using methods now in common use by Boy Scout and Girl Scout organizations in Virginia. These organizations may use the sales and use tax exemption certificate, Form ST-13, in making exempt purchases from suppliers.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1993

        CODE SECTION AFFECTED: 58.1-608

        Public Park and Botanical Garden:

        House Bill 308 (Chapter 13) exempts from the sales and use tax, tangible personal property purchased by an organization which is exempt from taxation under IRC 501 (c) (3) of the Internal Revenue Code and which is organized to provide a public park and botanical garden for the entertainment and recreation of Virginia citizens, and which also promotes the advancement of botanical science through research and the education of science students. At least one organization, Lewis Ginter Botanical Garden, Inc., qualifies for this exemption. A special exemption certificate will be developed for use by this organization and any others that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1994

        CODE SECTION AFFECTED: 58.1-608

        Ecological Organizations:

        House Bill 647 (Chapter 12) exempts from the sales and use tax, tangible personal property purchased for use or consumption by a national and international, nonprofit, scientific, and educational organization whose resources are devoted to preserving ecologically significant areas to safeguard rare or endangered species or critical natural habitats. At least two organizations, the Nature Conservancy and the Virginia Coastal Reserve, qualify for this exemption. A special exemption certificate will be developed for use by these organizations and any others that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1994

        CODE SECTION AFFECTED: 58.1-608

        Cultural Organizations:

        House Bill 1011 (Chapter 9) exempts from the sales and use tax, tangible personal property purchased by a nonprofit cultural organization which educates children about the arts, humanities and nature on a regular basis through museum exhibits, classes and performances. At least one organization, the Richmond Childrens' Museum, qualifies for this exemption. A special exemption certificate will be developed for this and other organizations that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1994,

        CODE SECTION AFFECTED: 58.1-608

        Public Libraries:

        Senate Bill 127 (Chapter 732) exempts from the sales and use tax, tangible personal property purchased for use or consumption by a nonprofit organization organized primarily to operate a public library. This will extend an exemption to public libraries operated by private nonprofit organizations. Public libraries owned and operated by Virginia state and local governments enjoy an exemption from the tax under current law. Nonprofit public libraries may use the exemption certificate, Form ST-13, in making exempt purchases from suppliers.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1991

        CODE SECTION AFFECTED: 58.1-608

        Tissue Bank:
        Senate Bill 127 also exempts from the tax a nonprofit tissue bank established to harvest, preserve, process and distribute bone, skin and other human tissue to licensed physicians for clinical use. At least one organization, the Virginia Tissue Bank, will qualify for this exemption. A special exemption certificate will be developed for use by this organization and any other tissue banks that qualify for the exemption.

        EFFECTIVE DATES: July 1, 1989 through July 1, 1993

        CODE SECTION AFFECTED: 58.1-608
        Recordation Tax

        DISTRIBUTION OF STATE TAX REVENUES:

        House Bill 1720 (Chapter 713) requires the Comptroller to distribute $40 million of the state revenue from the recordation and grantor's tax back to the localities in which the taxable deeds or other instruments were recorded. Localities will be required to use the amounts distributed for either transportation or public education purposes.

        Only those revenues actually deposited in the state treasury will be affected. Therefore, the bill will not affect the 5% commission retained by clerks of court, the portion of the tax retained by localities, or the local recordation tax. Amounts will be distributed within 30 days after the end of each quarter. Clerks of the circuit court are required to provide information to the Comptroller each quarter which will be used to make the distributions.

        EFFECTIVE DATES: July 1, 1989 through June 30, 1995

        CODE SECTION AFFECTED: 58.1-815
        Bank Franchise Tax

        PRORATION FOR NEW BANKS:

        House Bill 1455 (Chapter 64) provides for the proration of the bank franchise tax for a new bank which has not been in business for a full year before the January 1 date for valuing taxable capital. The local bank franchise tax will also be prorated as it is based on a percentage of the state tax. Proration will not be available to a new bank created as part of a merger or reorganization of existing banks.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-1204.1

        Tax on Wills and Administration (Probate

        INCREASE THRESHOLD OF TAXABLE ESTATE:

        House Bill 1536 (Chapter 387) increases the size of estates exempt from the probate tax to $5,000 and provides that the tax on estates over $5,000 shall be 100 per $100 (e.g., an estate of $5,025 would owe a tax of $5.10).

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 26-12.3, 58.1-1712, and 58.1-1714

        INCREASE THRESHOLD FOR REFUND OR BILLING:

        Senate Bill 570 (Chapter 223) increases from $5 to $25 the minimum additional tax or refund payable when the actual value of property passing by probate or intestacy as reported on the inventory differs from the estimated value reported at the time that a will is offered for probate or a grant of administration is requested.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-1717
        Corn Assessment

        RATE INCREASE:

        House Bill 1707 (Chapter 401) increases the corn assessment from one quarter cent per bushel to one cent per bushel, subject to approval in a referendum by the farmers who produce the corn.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 3.1-1033 and 3.1-1042
        Motor Vehicle Fuel Sales Tax

        DISCLOSURE OF INFORMATION:

        Senate Bill 515 (Chapter 326) authorizes the Tax Commissioner to provide the finance officer of any city or county who is charged with administering the motor vehicle fuel sales tax with relevant tax information which may be necessary for the performance of the officer's official duties.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-1724.1

        DISPOSITION OF TAX REVENUES:

        Senate Bill 648 (Chapter 417) permits the disposition of motor vehicle fuel sales tax revenues directly to a jurisdiction which joins the Northern Virginia Transportation District after July 1, 1989, to be applied to and ex-pended for any transportation purpose of such jurisdiction.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-1724
        Information Sharing

        Senate Bill 504 (Chapter 327) and House Bill 1415 (Chapter 99) authorize the Tax Commissioner to share tax information with the Department of Alcoholic Beverage Control and the State Lottery Department to facilitate the collection of state and local taxes and the administration of alcoholic beverage control laws.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3




        PART III
        LOCAL TAX LEGISLATION
        General

        INTEREST ON PREPAYMENT OF LOCAL TAXES:

        House Bill 1239 (Chapter 34) permits the governing body of any county, city or town to pay interest on designated local taxes voluntarily prepaid pursuant to a program established under this bill. If the tax is paid in full, the interest could be held in payment of future taxes or refunded to the taxpayer. The bill does not apply to local taxes which a taxpayer prepays outside of an established prepayment program.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3920.1

        INTEREST ON DELINQUENT LOCAL TAXES:

        HB 1776 (Chapter 238) provides that the maximum interest rate for failure to pay delinquent taxes for the second and subsequent years of delinquency may not exceed interest established pursuant to Section 6621 of the Internal Revenue code of 1954, as amended, or 10% annually, whichever is greater.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3916

        CORRECTION OF ERRONEOUS ASSESSMENTS:

        House Bill 1777 (Chapter 86) extends the period in which a taxpayer may apply to the commissioner of the revenue or other assessing official for a correction of an assessment from three to five years from the last day of the year for which the assessment is made.

        The bill also changes the period in which a taxpayer may apply to the circuit court from relief to five years from the last of the year for which the assessment is made. Currently the period is three years from the last day of the year in which the assessment is made.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-3980 and 58.1-3984
                          • License Taxes

        BUSINESSES OPERATED BY BLIND PERSONS:

        House Bill 1586 (Chapter 314) clarifies that blind persons operating vending stands or other business enterprises under the jurisdiction of the Department for the Visually Handicapped are exempt from all state and local taxes in connection with the operation of the business, except for the collection of sales and meals taxes.

        EFFECTIVE DATE: March 20, 1989

        CODE SECTIONS AFFECTED: 58.1-3703, 58.1-3840, 63.1-149, 63.1-152, 63.1-156, and 63.1-164

        COAL AND GAS ROAD IMPROVEMENT TAX:

        House Bill 1436 (Chapter 380) permits counties and cities to levy the local coal and gas road improvement tax on all gases, including methane, propane and other migratory gases. The bill also validates any existing ordinance which refers to sections under Title 58 made obsolete by the recodification.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-3713 and 58.1-3713.3

        COAL AND GAS ROAD IMPROVEMENT ADVISORY COMMITTEE:

        House Bill 1193 (Chapter 265) establishes a four-year term, initially commencing July 1, 1989, for citizen appointees to Coal and Gas Road Improvement Advisory Committees.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3713

        Property Taxes
        DAILY RENTAL PROPERTY TAX:

        House Bill 1410 (Chapter 589):
          • Classifies daily rental property as merchants capital, thereby exempting it from the tangible personal property tax;
          • Authorizes localities to levy a daily rental property tax, collectible from customers, of up to 1 % of the gross proceeds of short-term rental businesses; and
          • Classifies short-term rental businesses in the category of retail sales taxable at a top rate of $.20 per $100 of gross receipts for purposes of local business license taxes. Previously, these businesses have generally been classified as business services taxable at a top rate of $.36 per $100 of gross receipts.
        Daily rental property is tangible personal property held for rental and owned by a short-term rental business, but excludes motor vehicles, aircraft, and watercraft. Short-term rental businesses are those which receive 80% or more of their annual gross receipts from transactions involving rentals of 92 consecutive days or less. Rentals to affiliates and rentals of equipment with operators do not qualify as short-term rentals for purposes of the 80% requirement. Rental property owned by businesses that do not meet the 80% requirement are not classified as merchants capital under this bill and will remain subject to the tangible personal property tax.

        All exemptions from the retail sales and use tax, including the exemptions for federal, Virginia, and local governments and durable medical equipment, will be applicable to the daily rental property tax.

        EFFECTIVE DATE: July 1, 1989, except that the daily rental property tax cannot take effect until the first day of the first tax year beginning on or after July 1, 1989.

        CODE SECTIONS AFFECTED: 58.1-3510, 58.1-3510.1 - 58.1-3510.3, and 58.1-3706

        TAX RELIEF FOR THE ELDERLY AND HANDICAPPED:

        Senate Bill 812 (Chapter 555) provides that any county, city or town having a 1980 population of more than 500,000 and any county, city or town adjacent thereto may by ordinance increase the combined income limitation to $40,000 and the maximum net worth to $150,000, excluding the value of the dwelling and the land, not exceeding one acre, upon which it is situated. Any amount up to $6,500 of income of each relative who is not the spouse of the owner living in the dwelling may be excluded from the total combined income computation. These changes apply only to Fairfax County and adjacent counties, cities and towns.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3211

        House Bill 1526 (Chapter 568) provides that:
          • A locality may set the combined income limitation at the greater of $22,000, which is the current limit, or the income limits based upon family size for the respective metropolitan statistical area, annually published by the Department of Housing and Urban development for qualifying for federal housing assistance pursuant to Section 235 of the National Housing Act (12 USC 1715Z).
          • No local ordinance shall require a citizen to reside in the jurisdiction for a designated period of time as a condition for qualifying for exemption or deferral of real estate taxes under the article. The elimination of any residency requirement, however, does not effect the requirement in Section 58.1-3210 that the property for which relief is sought be occupied as the sole dwelling of the owner applying for relief.
          • The treasurer of any county, city or town must enclose in each real estate tax bill a written notice of the terms and conditions of any real estate tax exemption or deferral program established in the jurisdiction and to use any other reasonable means to notify residents of such a program.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-3211, 58.-3212, and 58.1-3213.1

        House Bill 1445 (Chapter 40) provides that a qualified taxpayer who loses his or her eligibility for tax relief due to changes in income, net worth, ownership of property or other factors shall receive the exemption or deferral for the portion of the year during which he or she qualifies and lose the exemption or deferral only for the remainder of the year. Before this amendment, the taxpayer would lose the benefit for the entire year in which such change occurs. The taxpayer would still lose the benefit for the year following the year in which the change occurred. Localities may provide by ordinance for this proration.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3215

        REHABILITATED REAL ESTATE:

        House Bill 1868 (Chapter 89) provides that the governing body of a county, city or town may establish criteria for determining whether substantially rehabilitated residential real estate qualifies for the partial exemption under Va. Code §58.1-3220. It retains, however, the requirement that the structure be no less than 25 years old and still allows the governing body to require that such structures be older than 25 years.
        Also, the bill allows the local governing body to determine by ordinance whether the amount of the exemption will be an amount equal to the increase in assessed value resulting from the rehabilitation or renovation or an amount up to 50% of the cost of rehabilitation.

        The bill makes similar amendments to Va. Code §58.1-3221 which provides for partial exemption of rehabilitated commercial or industrial real estate by deleting the requirement that the increase in assessed value be no less than 60% and allowing local governing bodies to establish criteria for determining whether real estate qualifies for this partial exemption. ft also provides that the local governing body may determine by ordinance whether the partial exemption will be an amount not to exceed the increase in assessed value or 50% of the cost of rehabilitation.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-3220 and 58.1-3221

        TAX INCREMENT FINANCING:
        Senate Bill 674 (Chapter 418) expands the definition of "blighted area" for purposes of tax increment financing by including any area adjacent to or in the immediate vicinity of designated blighted areas which may be improved or enhanced in value by the placement of a proposed highway construction project.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3245

        USE-VALUE ASSESSMENT:

        HB 1631 (Chapter 648) provides that recreational activities conducted for profit or otherwise shall not disqualify real estate which is classified for agricultural, horticultural or forestal use from use-value assessment and taxation provided it does not change the character of the real estate so that it no longer qualifies under the standards for which it currently qualifies.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3230


        VOLUNTEER FIRE DEPARTMENT AND RESCUE SQUAD MEMBERS:

        House Bill 1463 (Chapter 694) provides that one motor vehicle which is regularly used to respond to calls by a member of a volunteer rescue squad or volunteer fire department may be set out as a separate classification of tangible personal property for rate purposes and requires that in January of each year each member furnish the commissioner of the revenue or other assessing officer a certification by the chief or head of the volunteer organization that the said volunteer is a member of the organization who regularly responds to calls or who regularly performs other duties for the organization and that the vehicle is identified as regularly used for such purposes.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3506

        TRANSPORTATION OF THE PHYSICALLY HANDICAPPED:

        House Bill 1522 (Chapter 88) provides a separate classification for rate purposes for motor vehicles specially equipped to provide transportation for physically handicapped individuals.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3506

        COLLECTION OF TAX BILLS OF LESS THAN $5:

        House Bill 1600 (Chapter 81) provides that the governing body of any county or city and town may by ordinance provide for the collection of a tangible personal property tax bill of less than $5.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-3001 and 58.1-3005



        PRORATION:

        Senate Bill 539 (Chapter 329) and House Bills 1108 (Chapter 29) and 1291 (Chapter 36) add the counties of Bedford and Rockbridge and the city of Charlottesville to the list of localities which may provide by ordinance for the proration of personal property tax on motor vehicles, trailers and boats.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3516

        BOARDS OF EQUALIZATION:

        House Bill 1595 (Chapter 390) provides that a permanent board of equalization may consist of either three or five members. In the case of a three-member board, the members are to be appointed as follows: one for a term of one year, one for a term of two years and one for a term of three years. For five-member boards, one member for a term of one year, one for two years and three for three years. As the terms of the initial appointees expire, their successors shall be appointed for terms of three years.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3373

        REVIEW OF REAL ESTATE ASSESSMENTS:

        Senate Bill 641 (Chapter 300) restricts the duties of the board of equalization to equalizing real estate assessments and to hearing complaints on inequalities wherein the property owners allege a lack of uniformity in assessment or errors in acreage in such real estate assessments.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AMENDED: 58.1-3350

        FARM CLUBS ASSOCIATIONS:

        House Bill 1694 (Chapter 400) classifies as charitable associations all farm clubs associations operated for the purpose of sponsoring and operating a county fair for the display of agricultural products, the display and grading of farm animals and the enjoyment of the general public. As charitable associations, the property of such clubs would be exempt from taxation under Va. Code §58.1-3609, which is also amended to include organizations classified in Va. Code §58.1-3621.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTIONS AFFECTED: 58.1-3609 and 58.1-3621

        PUBLICATION OF VALUE OF EXEMPT REAL ESTATE:

        House Bill 1317 (Chapter 38) requires the appropriate county, city or town assessing officer to publish annually at the same time and in the same publication or in the same manner as the notice of local real sales is published or posted; a statement indicating the aggregate assessed value of all real property exempted from taxation under Va. Code §§58.1-3607 and 58.1-3608 and Articles 3, 4 and 5 of Chapter 36 of Title 58.1, and the total reduction in tax revenues resulting from such exemptions.

        EFFECTIVE DATE: July 1, 1989

        CODE SECTION AFFECTED: 58.1-3604


        • Rulings of the Tax Commissioner

        Last Updated 08/25/2014 16:46