Definite place of business
Local Power to Tax
February 18, 1997
Re: Request for Advisory Opinion: BPOL
This will respond to your letter transmitted by fax on February 5, 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. This response is intended to provide guidance only and does not constitute a formal or binding ruling. However, the Department shall not be required to interpret any local ordinance.
A weight loss clinic that advertises in the local paper conducts a class at the town community center on a weekly basis at a regularly scheduled day and time. The advertising for the class lists a special rate for 8 weeks of classes. The clinic has used the town's community center as its class location for at least a year. The clinic has refused to apply for a town business license stating on the application "Do not have a business in *********** ”.
The clinic must have a definite place of business in the town in order to be subject to licensure. At page 4 of the 1997 BPOL Guidelines, “definite place of business" is defined as:
- an office or location at which occurs a regular and continuous course of dealing where one holds one's self out or avails one's self to the public for thirty consecutive days or more, exclusive of holidays and weekends. A definite place of business for a person engaged in business may include a location leased or otherwise obtained from another person on a temporary or seasonal basis and real property leased to another.
"Continuous" for purposes of this definition is analyzed in terms of whether the business has established a location for the exercise of the licensable privilege. The time spent actually conducting business at this location is not important so long as the business is availing itself to the public and conducting its activities at that particular location. Regularly conducting business refers to a periodic pattern of instances in which a business is “open for business." A regularly conducted business may operate daily, weekly, monthly or for some other set time period.
As stated in the Guidelines, a place of business, for purposes of determining a definite place of business, may be a leased or otherwise obtained site. In this case it appears that the weight loss clinic conducts its weekly classes through an arrangement with the community center. It is further indicated that this pattern of business activity has occurred for the past year, well beyond the thirty days necessary to establish a definite place of business. Based on the foregoing, it appears that the weigh loss clinic has a definite place of business in the town and should be subject to licensure there.
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.
Danny M. Payne