Tax Type
BPOL Tax
Description
Exceptions; Business, professional, and occupational license (BPOL) tax; Public service corporations; Charter party carriers
Topic
Local Power to Tax
Date Issued
03-31-1997
March 31, 1997
Re: Request for Advisory Opinion: BPOL
Dear**************
This will respond to your letter transmitted by fax on March 6, 1997, requesting an advisory opinion.
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 questions raised in your letter, this response is intended to provide advisory guidance only and does not constitute a formal or binding ruling.
FACTS
You have inquired concerning the BPOL exemption for public service companies as it applies to a charter tour bus company located in the city. The company has contested the imposition of the BPOL tax on grounds that it is exempt as a public service corporation pursuant to § 58.1-3703.1 B 1. The city has maintained that the company is not exempt based on an opinion issued by the Attorney General, dated February 3, 1995, which concluded that charter party carriers are not public service corporations for purposes of the exemption provided in the BPOL statute.
OPINION
I conclude that the imposition of the BPOL tax on the charter carrier in this case is proper under the definitions provided in the Code of Virginia.
Public service corporations are not defined in the BPOL statute. However, § 58.1-2600 Code of Virginia, which provides for the taxation of public service corporations, defines a certificated motor vehicle carrier as:
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- a common carrier by motor vehicle, as defined in § 46.2-2000, operating over regular routes under a certificate of public convenience and necessity issued by the [State Corporation] Commission or issued after July 1, 1995 by the Department of Motor Vehicles.
Although the charter carrier in this case is "certificated" in the sense it has a certificate of public convenience and necessity to operate as a restricted common carrier, it does not operate over regular routes. By its nature a charter carrier travels irregular routes to various locations as directed by its customers. Therefore, the term "public service corporation" does not include charter carriers for purposes of state and local taxation. Because the foregoing definition of motor vehicle carriers in the public service corporation taxation chapter does not include charter carriers, I conclude that they would not be included under the public service corporation exemption in the BPOL statute.
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. If you have any further questions or comments, please do not hesitate to let me know.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/12328D
Rulings of the Tax Commissioner