Bulletin Number
VTB 85-14
Tax Type
Local Taxes
Description
1985 Legislative Changes Affecting Taxes Administered by Localities
Topic
Reports
Date Issued
07-26-1985
Virginia Tax Bulletin
Virginia Department of Taxation
85-14
DATE: July 26, 1985
SUBJECT: 1985 legislative changes affecting taxes administered by localities
The 1985 Session of the General Assembly enacted several laws affecting recordation tax, writ tax, the tax on wills and administration, local license tax, local transient occupancy tax, the tax on rolling stock, the assessment of railroad property, and local property tax. The purpose of this bulletin is to announce these changes which become effective July 1, 1985 unless otherwise noted.
Recordation Tax Exemption: § 58.1-811(A)(12) has been amended to exempt from the recordation tax imposed under §§ 58.1-801, 58.1-802, and 58.1-803 the recording of any deed conveying real estate to the original beneficiaries of a trust from the trustees holding title under a deed in trust. (Chapter 134, House Bill 1697)
Writ Tax Exemption: § 37.1-67.6 has been amended to exempt from the writ tax, the appeal to a circuit court of an involuntary commitment order. (Chapter 106, House Bill 1393)
Acceptance of Writing for Recordation: § 17-59 has been amended to allow the Clerk of the Court to refuse to accept any writing for recordation unless:
1. each individual's surname is underlined or written entirely in capital letters when it first appears in the deed;
2. each page of the instrument or writing is numbered; and
3. any claim for recordation tax exemption is clearly stated on the face of the writing (Chapter 246, House Bill 1637).
Exemption from Tax on Wills and Administration: § 58.1-1712 has been amended to increase from $100 to $500 the value of a decedent's estate exempt from the state tax imposed on submitting a will for probate or requesting a grant of administration. (Chapter 474, House Bill 1521)
Local license; Wholesale Merchants Tax: § 58.1-3703 has been amended to permit counties, cities, or towns to license a wholesale merchant on purchases, when the licensee is a member of an affiliated group of corporations and makes its purchases from members of the affiliated group and its sales to nonaffiliated persons, companies or corporations. The act also defines "sales by the affiliated corporation to a nonaffiliated person, company or corporation" and limits the goods sold by the wholesaler to those goods manufactured or stored in the Commonwealth prior to their delivery to the nonaffiliate. (Chapter 531, Senate Bill 603)
Local license; Oil Severance Tax: § 53.1-3712.1 has been added to the Code authorizing counties and cities to impose a local business tax on severing oil. The tax rate is one-half of one percent of gross receipts from the sale of oil severed in the county or city. The authority to levy the tax expires on July 1, 1992. (Chapter 120, House Bill 1152)
Local license; Coal Road Improvement Tax: The second enactment of Chapter 646 of the 1978 Acts of Assembly has been amended to extend from December 31, 1986, until December 31, 1992, the expiration date of the local coal road improvement tax. (§ 58.1-3713, Chapter 539, House Bill 1202)
Local Transient Occupancy Tax: § 58.1-3819 has been amended to authorize any county to adopt an ordinance levying a transient occupancy tax on hotels, motels, boarding houses, and travel campgrounds. A commission of between three and five percent may be allowed to businesses required to collect, account for, and remit the tax. (Chapter 556, Senate Bill 510)
Revenue from State Tax on Rolling Stock of Railroad and Freight Car Companies: Beginning in 1987 revenue from the tax on rolling stock will be distributed to localities in which railroads own property. One half of the revenue will be distributed on the basis of the proportion which the value of the roadbed and track in a locality bears to the value of all roadbed and track in the State; the remaining half will be distributed on the basis of the proportion which the total track miles in a locality bears to all track miles in the State. In 1984, total revenue from this source was $5.4 million. (Chapter 557, Senate Bill 615)
Local Assessment of Nonoperating Property of Railroads: Real property owned by railroads but not used in rail carrier operations will be subject to local assessment beginning in 1986. The Department will provide to each locality a list of nonoperating properties held by each railroad in that particular locality. The department will continue to assess annually for state and local taxation the carrier property of railroads. The Tax Commissioner will make the final determination if any question arises as to whether a particular property is to be classified as operating or nonoperating. (Chapter 30, House Bill 1130)
Tangible Personal Property: § 58.1-3503 has been amended to provide that automobiles and trucks of less than two tons must now be valued by means of a recognized pricing guide. Only when such a vehicle is not listed in a recognized pricing guide may a percentage of original cost be used. (Chapter 105, House Bill 1391)
§ 58.1-3506 has been amended to provide that privately owned pleasure boats and watercraft used for recreational purposes are now a separate class of tangible personal property for purposes of taxation they may be taxed at a rate no higher than that applied to the general class of tangible personal property. (Chapter 220, House Bill 1461)
§ 58.1-3912 has been amended to provide that the governing body of any county, city, or town may attach to or mail with all real estate and personal property bills information indicating how the tax rate charged upon such property and revenue derived from this tax is apportioned among the various services and governmental functions provided by the locality. (Chapter 406, House Bill 1719)
§ 58.1-3516 has been amended to provide that when situs has been established in this state for taxation of vehicles owned by an interstate common, contract, or other private carrier, but such vehicle is subject to property tax in another state on the basis of an apportioned assessment, the assessment in Virginia will then be apportioned in the same percentage as the total number of miles traveled in the Commonwealth bears to the total number of miles traveled by such vehicle. Localities had previously been denied an assessment on these vehicles. (Chapter 156, Senate Bill 614)
Delinquent Real Estate Taxes: §§ 58.1-3928, 58.1-3930, 58.1-3937, and 58.1-3933 have been amended to provide that liens of delinquent real estate taxes must not be recorded in the treasurer's office; previously such liens were recorded in the clerks office. (Chapter 131, House Bill 1524)
§ 58.1-3968 has been amended to provide that two or more parcels may now be covered by one bill in equity for purposes of sale for delinquent taxes even when they are assessed against and owned by different parties, provided each parcel is assessed at $20,000 or less. (Chapter 60, House Bill 1394)
Property Exempt From Taxation: §§ 58.1-3906 and 58.1-3907 have been amended to grant exempt status to those classes and parcels of property which were exempt-under the Constitution of 1902. The Attorney General had ruled these were not exempt under the Constitution of 1972. (Chapter 495, House Bill 1121)
Review of Assessment: Senate Bill 494 clarifies § 58.1-3350 by including the fact that in some localities aggrieved parties are required, by charter provision, to apply for relief to the board of assessors or the board of equalization prior to applying to the circuit court. In localities where application to the board is not a prerequisite, the aggrieved party may apply directly to the circuit court for relief. (Chapter 64, Senate Bill 494)
Assessment of Open or Common Space: § 58.1-3284.1 has been added to provide that all real property used for open or common space in planned development subdivisions shall be construed as having no value in itself for assessment purposes. Its only value lies in the value attached to the property which has a right to its use by easement, covenant, or other interest. The residential or commercial property in the planned development which includes the right to the use of the open or common space, shall be assessed at a value which includes the proportional share of the value of such open or common space. (Chapter 550, House Bill 1591)
Reassessment of Real Estate: § 58.1-3300 has been amended 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 was required. (Chapter 221, House Bill 1475)
Roll Back Taxes: Senate Bill 184 addresses the issues of annexation, immunity and consolidation procedures, one of which relates to collection of roll back taxes and interest. § 58.1-3237 has been amended to provide 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 taxes and interest and return to the county its share, if any, of such taxes and interest. This share shall be proportionate to the amount of such period, if any, for which the real estate was situated in the county. (Chapter 478, Senate Bill 184)
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