Tax Type
BPOL Tax
Description
Gross receipts
Topic
Local Power to Tax
Date Issued
03-03-1997
March 3, 1997
Re: Request for Advisory Opinion: BPOL
Dear********************
This will respond to your facsimile dated February 14, 1997, regarding the deduction of payroll taxes from gross receipts.
The license tax is a local tax which is imposed and administered by local officials. The Code of Virginia limits the involvement of the Department of Taxation to promulgating guidelines and issuing advisory opinions. However, the department shall not be required to interpret any local ordinance.
While addressing the question raised in your letter, this response is intended to provide advisory guidance only and does not constitute a formal or binding ruling.
FACTS
You ask whether a business may deduct payroll taxes from their gross receipts.
OPINION
Code of Virginia § 58.1-3700.1, copy enclosed, defines gross receipts as "... the whole, entire, total receipts, without deduction." (Emphasis Added.) A business may not deduct or exclude any receipts from gross receipts unless expressly permitted by statute. No section of the BPOL statute expressly allows a business to deduct payroll taxes. Thus, payroll taxes are not deductible from gross receipts.
I hope that the above information will be beneficial to you. Although I believe this letter conforms with the law, it is written only for your guidance, and the final determination is with the locality.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/12177B
Rulings of the Tax Commissioner