Tax Type
General Provisions
Description
1985 Legislative Digest
Topic
Reports
Date Issued
06-01-1985
1985
Legislative Digest
VIRGINIA DEPARTMENT OF TAXATION
Department of Taxation
P.O. Box 6-L Richmond, Va. 23282
June, 1985
CONTENTS
INTRODUCTION
STATE TAXES
General
Cattle
Egg Excise
Income
Railroad and Pipeline Assessment
Recordation
Retail Sales and Use
Hills and Administration
LOCAL TAXES
General
License
Property
Transient Occupancy
INDEX OF LEGISLATION
INTRODUCTION
This digest is published by the Department of Taxation as a convenient reference guide to some of the legislation affecting state and local taxation enacted by the 1985 session of the General Assembly. It is not intended to present a definitive interpretation of the law here; however, this digest should prove useful to state and local officials as well as the general citizenry in understanding the enactments of the General Assembly. With regard to state taxation, the acts of the Assembly summarized in this digest are only those affecting taxes administered by the Department of Taxation. Other state taxes such as corporate franchise or gross receipts taxes, the gasoline tax, and the motor vehicle sales tax are not dealt with in this digest.
The digest is organized in two parts: state taxes and local taxes. In each part specific tax subjects are arranged with the bills beneath them in numeric order. House bills appear first followed by Senate bills. Chapter numbers for each bill refer to the 1985 Acts of-the Assembly. An index of bills appears at the end of the digest.
STATE TAXES
GENERAL
HOUSE BILL 1207 (Chapter 78)
This act amends §58.1-3 to authorize the Tax Commissioner to furnish the State Education Assistance Authority with the home address of persons who have defaulted on loans guaranteed by the authority. The act is effective July 1, 1985.
HOUSE BILL 1238 (Chapter 566)
This act permits the local governing body of an area designated as an urban enterprise zone to apply to the Department of Housing and Community Development to expand the area of such zone. The act is effective July 1, 1985.
HOUSE BILL 1296 (Chapter 204)
This act amends §§ 58.1-106 and 58.1-107 to allow the Department to store tax return information electronically rather than on a hard medium. The act is effective July 1, 1985.
HOUSE BILL 1475 (Chapter 221)
This act corrects a number of technical errors in Title 58.1 resulting from the recodification of Title 58 and corrects references to the Internal Revenue Code affected by the Tax Reform Act of 1984. The act is effective January 1, 1985.
SENATE BILL 540 (Chapter 464)
This act provides the Department of Taxation with the authority to contract with collectors or collection agencies to collect delinquent state taxes owed by taxpayers residing or domiciled outside of Virginia. The act is effective July 1 , 1985.
This act amends § 2.1-342 of the Virginia Freedom of Information Act to exempt from disclosure all tax information protected by § 58.1-3. The act is effective July 1 , 1985.
CATTLE
HOUSE BILL 1568 (Chapter 237)
This act amends §§ 3.1-796.25, 3.1-796.26 and 3.1-796.27 to transfer the authority for collecting and recording the Virginia Cattle Tax from the Virginia Cattle Industry Commission to the Tax Commissioner. The act contains an emergency clause and is in effect from its passage. The act was approved by the governor on March 14, 1985.
EGG EXCISE
HOUSE BILL 1096 (Chapter 173)
This act amends § 3.1-796.11:3 to remove from imposition of the egg excise tax those eggs purchased, processed, graded or otherwise handled in Virginia. The tax continues to be imposed on eggs produced or sold in Virginia. The act is effective July 1, 1985.
INCOME
SENATE BILL 588 (Chapter 465)
This act amends §§ 58.1-322 and 58.1-402 and adds a new § 58.1-322.1 to allow individual and corporate taxpayers engaged in the business of farming to deduct the wholesale market value of any "qualified agricultural contribution." The act is effective for taxable years beginning on and after January 1, 1985 but not on and after January 1, 1988.
SENATE BILL 651 (Chapter 466)
This act amends § 58.1-322 to allow individual shareholders of an electing small business corporation to claim a credit for income taxes paid to other states by the S corporation. The act is effective for taxable years beginning on and after January 1, 1985.
SENATE BILL 712 (Chapter 560)
This act adds §§ 58.1-334 and 58.1-432 to allow individuals and corporations to claim a credit equal to 25% of expenditures for conservation tillage equipment (commonly known as a "No-till" planter or drill) up to $2,500.00 or the total amount of tax, whichever is less. If the amount of such credit exceeds the taxpayer's tax liability for the tax year the excess may be carried over to the succeeding five taxable years. The act is effective for taxable years beginning on and after January 1 , 1985.
RAILROAD & PIPELINE ASSESSMENT
HOUSE BILL 1130 (Chapter 30)
This act amends §§ 58.1-2653, 58.1-2655 and 58.1-3201 to transfer the responsibility for assessing for taxation the nonoperating (noncarrier) property of railroads from the Department to the locality where the property is located. The act is effective July 1, 1985.
SENATE BILL 615 (Chapter 557)
This act amends § 58.1-2652 and adds § 58.1-2658.1 to require that revenue collected from the tax on rolling stock of railroads and freight car companies be distributed to localities based on both the miles of track and the fair market value of road and track in the locality. This act is effective for tax years beginning on and after January 1, 1987.
RECORDATION
HOUSE BILL 1637 (Chapter 246)
This act amends § 17-59 to permit a clerk of a circuit court to refuse to accept any writing for recordation unless the Code Section under which any exemption from recordation taxes is claimed is clearly stated on the face of the writing, each individual's surname is underlined or written entirely in capital letters when it first appears in the deed, and each page of the instrument or writing is numbered. The act is effective July 1, 1985.
HOUSE BILL 1697 (Chapter 134)
This act amends § 58.1-811 to exempt from recordation tax any deed conveying real estate to the original beneficiaries of a trust from the trustees holding title under a deed in trust. The act is effective July 1, 1985.
SALES
HOUSE BILL 1241 (Chapter 98)
This act amends § 58.1-609 to exempt from the one percent local sales and use tax, where applicable, the purchase of fuel by a nonprofit church for donation to an individual for use in his residence. These purchases are already exempt from the three percent state tax. This act is effective July 1, 1985.
HOUSE BILL 1262 (Chapter 468)
This act amends § 58.1-608 to exempt from the sales and use tax tangible personal property purchased for use or consumption by a nonprofit science-technology museum whose operating budget is at least 10% state funded. The act applies to the Roanoke Valley Science Museum, the Peninsula Nature Science Museum and similar organizations. The act is effective July 1 , 1985.
HOUSE BILL 1312 (Chapter 469)
This act amends § 58.1-608 to exempt from the sales and use tax catalogs, letters, brochures, reports and similar printed materials, paper furnished to a printer for fabrication into such materials and the envelopes, containers, and labels to package and mail such materials, when stored for twelve months or less in Virginia and distributed for use outside the State. This exemption does not apply to administrative supplies, such as letterhead and envelopes, stationery, invoices, billing forms, payroll forms, price lists, time cards and computer cards, even though such supplies may be mailed outside Virginia. Currently, the exemption is restricted to catalogs and other printed materials used to advertise the sale of tangible personal property. The act is effective July 1 , 1986 and will expire June 30, 1990.
HOUSE BILL 1388 (Chapter 471)
This act amends § 58.1-608 to exempt from sales and use tax fishing boats, marine engines and outboard motors used to propel such boats, and repair and replacement parts for such boats when -purchased by commercial watermen for use in extracting fish, bivalves or crustaceans for commercial purposes. This exemption only applies to those boats subject to the four percent Retail Sales and Use Tax. Boats subject to the two percent Watercraft Sales and Use Tax are not exempt under this act. The act is effective July 1, 1985.
HOUSE BILL 1453 (Chapter 472)
This act amends § 58.1-608 to exempt from the sales and use tax purchases for use or consumption by a nonprofit organization operating a public park and museum for recreational and educational purposes on property owned by a city. The act applies to the Maymont Foundation in the City of Richmond and similar organizations. The act is effective July 1, 1985.
HOUSE BILL 1472 (Chapter 473)
This act amends §§ 58.1-602 and 58.1-608 to exempt from the sales and use tax the charge made for planning, creating or placing advertising in newspapers, magazines, billboards, broadcasting or other media. The act is effective July 1, 1986.
HOUSE BILL 1739 (Chapter 477)
This act amends § 58.1-608 to exempt from the sales and use- tax special typewriters and computers and related parts and supplies specifically designed for such products when used by handicapped persons to communicate, provided such products are prescribed by a licensed physician. The act is effective July 1, 1985.
SENATE BILL 583 (Chapter 460)
This act amends § 58.1-608 to exempt from the sales and use tax tangible personal property used or consumed by, sold by or donated to nonprofit food banks and similar organizations which are organized and operated exclusively for the distribution of food to infants, the ill or the needy. The act is effective July 1, 1985.
WILLS AND ADMINISTRATION
HOUSE BILL 1521 (Chapter 474)
This act amends § 58.1-1712 to increase from $100 to $500 the value of a decedent's estate exempt from the state tax imposed upon the probate of a will or grant of administration. The act is effective July 1, 1985.
WRIT
HOUSE BILL 1393 (Chapter 106)
This act amends § 37.1-67.6 to exempt from the writ tax an appeal to the circuit court of an involuntary commitment order. The act is effective July 1 , 1985.
LOCAL TAXES
GENERAL
HOUSE BILL 1719 (Chapter 406)
This act amends § 58.1-3912 to permit the governing body of any county or city to include with all real estate and tangible personal property tax bills information indicating how the tax rate and revenue is apportioned among the various services and governmental functions provided by the locality. The act is effective July 1, 1985.
LICENSE
HOUSE BILL 1152 (Chapter 120)
This act amends § 58.1-3706 and adds § 58.1-3712.1 to authorize counties and cities to impose a license tax on the severance of oil at a rate equal to one-half of one percent of the gross receipts derived from the sale of such oil. The act is effective July 1, 1985, but no oil severance tax may be levied on or after July 1 , 1992.
HOUSE BILL 1202 (Chapter 539)
This act amends chapter 646 of the 1978 Acts of Assembly to extend the expiration date of the coal road improvement tax (§ 58.1-3713) from December 31, 1986 to December 31, 1992.
SENATE BILL 603 (Chapter 531)
This act amends § 58.1-3703 to permit a county, city or town to license a wholesale merchant who is a member of an affiliated group of corporations and who sells to nonaffiliated persons, companies or corporations even though the purchases of the wholesale merchant are from members of the affiliated group. The act is effective July 1, 1985.
PROPERTY
HOUSE BILL 1121 (Chapter 495)
This act amends §§ 58.1-3606 and 58.1-3607 to grant exempt status to those classes and parcels of property acquired after July 1, 1971 which would have been exempt under the Constitution of 1902 but which the Attorney General ruled were not exempt under the Constitution of 1972. The act is retroactive to tax years beginning on and after July 1, 1980.
HOUSE BILL 1329 (Chapter 543)
This act amends § 58.1-3219 to acquire any county which has adopted the urban county executive form of government, and any county contiguous thereto which has adopted the county executive form of government, to mail tangible personal property tax bills not later than thirty days prior to the due date of such taxes. The act applies to Fairfax County and Prince William County. The effective date of the act is July 1, 1985.
HOUSE BILL 1391 (Chapter 105)
This act amends § 58.1-3503 to require that the valuation of automobiles and trucks of less than two tons for purposes of local taxation be by means of a recognized pricing guide. The local assessing officer may use a percentage of percentages of original cost only if the model and year of the vehicle is not listed in the guide. The effective date of the act is July 1 , 1985.
HOUSE BILL 1394 (Chapter 60)
This act amends § 58.1-3968 to provide that two or more parcels may covered by one bill in equity for purposes of sales for delinquent taxes if they are assessed against and owned by different parties, but each parcel is assessed at a value which does not exceed $20,000. The act contains an emergency clause and is in effect from its passage. The act was approved by the governor on February 26, 1985.
HOUSE BILL 1461 (Chapter 220)
This act amends § 58.1-3506 to provide that the local rate of tax and rate of assessment applicable to privately owned recreational watercraft may be less than that applicable to the general class of tangible personal property. The act is effective July 1, 1985.
HOUSE BILL 1475 (Chapter 221)
This act makes a number of technical corrections to the recodification of Title 58 and, in addition, amends § 58.1-3300 to provide that the person or persons appointed by the governing body to perform the annual or biennial reassessment of real estate is authorized to sign the land book attesting to the valuations contained therein resulting from the reassessment. Previously a separate reassessment record had to be prepared. The act is effective January 1, 1985.
HOUSE BILL 1524 (Chapter 131)
This act repeals § 58.1-3929 and amends §§ 58.1-3928, 58.1-3930, 58.1-3937 and 58.1-3938 to transfer from the local clerks to the local treasurer the responsibility for recordation of liens on delinquent real estate and the collection of delinquent taxes on real estate subject to the lien. The act is effective July 1, 1985.
HOUSE BILL 1591 (Chapter 550)
This act adds § 58.1-3284.1 to provide that in certain planned unit development subdivisions, all real property used for open or common space shall be construed as having no value in itself for assessment purposes. Its value lies in the value attached to the residential or commercial property which has a right by easement, covenant, deed or other interest to the use of the open or common space. The act is effective July 1, 1985.
HOUSE BILL 1602 (Chapter 241)
This act amends § 3516 to authorize Roanoke County to prorate personal property taxes. The act is effective July 1 , 1985.
HOUSE BILL 1765 (Chapter 258)
This act amends § 3516 to authorize Scott County to prorate personal property taxes. The act is effective July 1, 1985.
SENATE BILL 184 (Chapter 478)
This act amends § 58.1-3237 and various sections in Title 15.1 to address issues relating to annexation, immunity and consolidation procedures. The act provides that if real estate is annexed by a city and granted use value assessment and taxation, and such real estate had been granted use value taxation by the county prior to annexation, the city shall collect the roll back axes and interest and return to the county its share, if any, of, such taxes. The act is effective July 1, 1985.
SENATE BILL 468 (Chapter 62)
This act repeals chapter 47 of the 1950 Acts of Assembly (referred to in § 58.1-3372) relating to appointment of boards of equalization. The act is effective July 1 , 1985.
SENATE BILL 494 (Chapter 64)
This act amends § 58.1-3350 to clarify that any person aggrieved by any assessment of real property may appeal to the appropriate county or city circuit court for relief as long as a prior appeal to the board of assessors or board of equalization is not a prerequisite to the jurisdiction of the court. The act is effective July 1, 1985.
SENATE BILL 614 (Chapter 156)
This act amends § 58.1-3511 to require that the assessment of personal property tax for certain vehicles operating over interstate routes be apportioned by the percentage of miles traveled in Virginia if such vehicle is subject to an apportioned assessment in another state. The act is effective July 1, 1985.
TRANSIENT OCCUPANCY
SENATE BILL 510 (Chapter 556)
This act amends § 58.1-3819 to authorize any county to levy a transient occupancy tax on hotels, motels, boarding houses and travel campgrounds at a rate not to exceed two percent of the room charge. The act also authorizes the county to allow businesses which collect the tax a commission to defray the cost of administration. The act is effective July 1 , 1985.
INDEX OF LEGISLATION
Chapter Bill No. Subject Page
30 HB 1130 Railroad & Pipeline non-operating property
60 HB 1394 Sale of land for delinquent property taxes
62 SB 468 Board of Equalization; appointment
64 SB 494 Appeal of incorrect property assessment
78 HB 1207 Tax information for State Education Assistance Auth.
98 HB 1241 Sales Tax; heating fuel purchased by churches
105 HB 1391 Property Tax; recognized auto pricing guide
106 HB 1393 Writ Tax; appeal of involuntary commitment
120 HB 1152 Local oil severance tax
131 HB 1524 Treasurer to keep lists of delinquent property tax
134 HB 1697 Recordation; trustee conveying to original beneficiaries
155 SB 608 F.O.I.A.; tax documents exempt
156 SB 614 Apportionment of interest vehicle assessments
173 HB 1096 Egg Excise Tax; definition of handler
204 HB 1296 Dept. use of reproduction techniques
220 HB 1461 Property Tax; Pleasure and recreation boats
221 HB 1475 Technical Corrections to recodification
237 HB 1568 Virginia Cattle Tax
241 HB 1602 Property Tax; proration by Roanoke
246 HB 1637 Recordation; exemption must be set forth
258 HB 1765 Property; proration by Scott
406 HB 1719 Property; Information on tax bills
460 SB 583 Sales Tax; contributions to Food Banks
464 SB 540 Out of state collection agencies
465 SB 588 Income Tax; donation of agricultural products
466 SB 651 Income Tax; Taxes paid by S corporations
468 HB 1262 Sales Tax; Science Technology Museum
469 HB 1312 Sales Tax; catalogs and printed materials
471 HB 1388 Sales Tax; fishing boats
472 HB 1453 Sales Tax; public part and museum manager
473 HB 1472 Sales Tax; advertising services
474 HB 1521 Probate; $500 minimum estate
477 HB 1739 Sales Tax; handicapped communication equipment
478 SB 184 Property; roll back tax in annexed area
495 HB 1121 Property; organizations exempt on July 1, 1971
531 SB 603 BPOL; wholesale merchants
539 HB 1202 Coal road improvement tax extended
543 HB 1329 Property; bills mailed 30 days before due
550 HB 1591 Property Tax; assessment of open space
556 SB 510 Transient Occupancy Tax; any county allowed
557 SB 615 Rolling Stock Tax; distribution of revenue
560 SB 712 Income Tax; conservation tillage equipment
566 HB 1238 Urban Enterprise Zones; expansion allowed
Legislative Summaries