2006 Code of Virginia § 58.1-3812 - (Repealed effective January 1, 2007) Telegraph and telephone companies

58.1-3812. (Repealed effective January 1, 2007) Telegraph and telephonecompanies.

A. Subject to the limitations contained in subsections C and K, any county,city or town may impose a tax on a taxable purchase by a consumer of localtelecommunication service if the consumer's service address is located insuch county, city or town. Except as otherwise provided, the tax shall not beimposed at a rate in excess of 20 percent of the monthly gross charge to aconsumer and shall not be applicable to any amount so charged in excess of$15 per month for a residential consumer; however, any county, city or townthat on July 1, 1972, imposed a tax in excess of limits specified herein maycontinue to impose such a tax in excess of such limits, but no more.Notwithstanding the foregoing, the tax may be imposed only at a rate equal to10 percent of the monthly gross charge to a consumer of local mobiletelecommunications service and shall not be applicable to any amount socharged in excess of $30 per month for each mobile telecommunications servicenumber billed to a mobile service consumer. No county, city or town thatcurrently is not collecting the tax on local mobile telecommunicationsservice shall begin to collect the tax on local mobile telecommunicationsservice before September 1, 1994, for bills sent to consumers on and afterthat date. However, any county with a population of at least 68,000 but notmore than 69,000, any city with a population of at least 40,000 but not morethan 41,000, and any city with a population of at least 66,000 but not morethan 67,000 shall conform with the provisions of this section in accordancewith the following schedule:

FiscalYearRateCap
1994-9510%None
1995-9610%$100
1996-9710%$50
July1,1997
andthereafterFull
Confo
rmity

B. Any tax enacted pursuant to the provisions of this section or any changein a tax or structure already in existence shall not be effective until 120days subsequent to written notice by certified mail from the county, city ortown imposing such tax or change thereto, being received by the registeredagent of the service provider that is required to collect the tax.

C. No county shall impose a tax hereunder within the limits of anyincorporated town located within such county when such town constitutes aseparate school district and such town imposes a town tax authorized by thissection. No county shall impose a tax hereunder within the limits of anyincorporated town located within such county when such town has enacted anordinance on or before January 1, 2000, to impose a tax hereunder and suchordinance remains in effect. Except as provided in this subsection, no townshall impose a tax hereunder if the county within which such town is locatedimposes a county tax authorized by this section.

D. 1. Notwithstanding the limitations in subsection C, on or after July 1,2002, the local governing body of the Town of Orange may enact an ordinanceto impose the tax hereunder. At the time such ordinance is enacted, OrangeCounty shall no longer impose the tax within the limits of the Town of Orangewhile such ordinance remains in effect.

2. Notwithstanding the limitations in subsection C, on or after July 1, 2003,the local governing bodies of the Towns of Gordonsville, Colonial Beach andMontross may enact an ordinance to impose the tax hereunder. At the time suchordinance is enacted by the governing body of the Town of Gordonsville,Orange County shall no longer impose the tax within the limits of the Town ofGordonsville while such ordinance remains in effect. At the time suchordinance is enacted by the Town of Colonial Beach or the Town of Montross,Westmoreland County shall no longer impose the tax within the limits of thetown enacting such ordinance while such town ordinance remains in effect.

3. Notwithstanding the limitations in subsection C, on or after July 1, 2004,the local governing bodies of the Towns of Clifton, Herndon and Vienna mayenact an ordinance to impose the tax hereunder. At the time such ordinance isenacted by the Town of Clifton, the Town of Herndon or the Town of Vienna,Fairfax County shall no longer impose the tax within the limits of the townenacting such ordinance while such town ordinance remains in effect.

4. Notwithstanding the limitations in subsection C, if, on or after July 1,2004, the local governing body of the Town of Iron Gate enacts an ordinanceto impose the tax hereunder Alleghany County shall not impose such tax withinthe limits of the Town of Iron Gate while such ordinance remains in effect.

5. Notwithstanding the limitations in subsection C, on or after July 1, 2005,the local governing body of the Town of Dumfries may enact an ordinance toimpose the tax hereunder. At the time such ordinance is enacted by the Townof Dumfries, Prince William County shall no longer impose the tax within thelimits of the Town of Dumfries while such town ordinance remains in effect.

E. Any county, city or town may provide for an exemption from the tax for anypublic safety answering point as defined in 58.1-3813.1.

F. Any city with a population of not less than 27,000 and not more than28,500 may provide an exemption from the tax for any church or religious bodyentitled to an exemption pursuant to Article 4 ( 58.1-3650 et seq.) ofChapter 36. Any city providing such exemption shall provide the telephoneaccount numbers of all exempted churches and religious bodies to all serviceproviders required to collect the tax as part of the notice required pursuantto subsection B.

G. A service provider of local telecommunication services shall collect thetax from the consumer by adding the tax to the monthly gross charge for suchservices. The tax shall, when collected, be stated as a distinct itemseparate and apart from the monthly gross charge. Until the consumer pays thetax to the service provider, the tax shall constitute a debt of the consumerto the county, city or town. If any consumer refuses to pay the tax, theservice provider shall notify the county, city or town. After the consumerpays the tax to the service provider, the taxes collected shall be deemed tobe held in trust by the service provider until remitted to the county, cityor town.

H. A service provider shall remit monthly to each county, city or town theamount of tax billed during the preceding month to consumers with a serviceaddress in that county, city or town, less any discount allowed under 58.1-3816.1.

I. No county, city or town may impose the tax on consumers of local mobiletelecommunications service unless it also imposes the tax on the consumers ofthe other forms of local telecommunication services.

J. Any consumer shall be entitled to a refund from the county, city or townimposing the tax equal to the amount of any tax the consumer paid to ajurisdiction outside of the Commonwealth if such tax was legally imposed insuch other jurisdiction; however, the amount of credit or refund shall notexceed the tax paid to the county, city or town on such purchase.

K. 1. The federal Mobile Telecommunications Sourcing Act (4 U.S.C. 116 etseq., as amended) created a uniform methodology for sourcing of mobiletelecommunications services subject to state and local taxes, fees, andcharges. It is the intent of the General Assembly that state and local taxes,fees, and charges on mobile telecommunications service be imposed inaccordance with federal law.

2. Mobile telecommunications service provided to a customer and billed by orfor the customer's home service provider shall be deemed to be provided bythe home service provider at the customer's place of primary use. Subject tothe exclusions in the federal Mobile Telecommunications Sourcing Act, 4U.S.C. 116 (c), as amended, local mobile telecommunications service taxableunder subsection A shall be taxable in the jurisdiction whose territoriallimits encompass the customer's place of primary use, regardless of where themobile telecommunications services originate, terminate, or pass through. Nomobile telecommunications service shall be taxable in this Commonwealth orany jurisdiction in this Commonwealth if the customer's place of primary useis outside this Commonwealth.

3. When otherwise taxable and non-taxable charges for mobiletelecommunications service are aggregated, the charges for nontaxable mobiletelecommunications service shall be subject to taxation, unless the homeservice provider can reasonably identify charges not subject to taxation fromits books and records that are kept in the regular course of business.

4. The Tax Commissioner may provide a home service provider with anelectronic database that meets the requirements of 4 U.S.C. 119, asamended. If such database is provided, a home service provider shall be heldharmless from any tax, charge, or fee liability for errors of omissions duesolely to the reliance on such database, subject to 4 U.S.C. 119 and 121,as amended. If no electronic database is provided by the Tax Commissioner, ahome service provider may use an enhanced zip code to assign each streetaddress to a specific taxing jurisdiction, and the home service providershall be held harmless from any tax, charge, or fee liability that otherwisewould be due solely as a result of an assignment of a street address to anincorrect taxing jurisdiction, subject to 4 U.S.C. 120 and 121, as amended.

5. The Tax Commissioner shall require a home service provider to obtain andmaintain a customer's place of primary use and the local assessing officershall allow the home service provider to rely on this address as providedunder 4 U.S.C. 122, as amended. The Tax Commissioner may correct the placeof primary use, or correct the assignment of a taxing jurisdiction by a homeservice provider, in accordance with 4 U.S.C. 121, as amended.

6. Nothing in this subsection modifies, impairs, supersedes, or authorizesthe modification, impairment, or supersession of any law allowing a taxingjurisdiction to collect a tax, charge, or fee from a customer that has failedto provide its place of primary use.

7. If a customer believes that an amount of tax, charge, or fee or anassignment of place of primary use or taxing jurisdiction included on abilling is erroneous, the customer shall notify the home service provider inwriting. The customer shall include in this written notification the streetaddress for the customer's place of primary use, the account name and numberfor which the customer seeks a correction, a description of the errorasserted by the customer, and any other information that the home serviceprovider reasonably requires to process the request. Within 60 days ofreceiving a notice under this section, the home service provider shall reviewits records to determine the customer's taxing jurisdiction. If this reviewshows that the amount of tax, charge, or fee or assignment of place ofprimary use or taxing jurisdiction is in error, the home service providershall correct the error and refund or credit the amount of tax, charge, orfee erroneously collected from the customer for a period of up to two years.If this review shows that the amount of tax, charge, or fee or assignment ofplace of primary use or taxing jurisdiction is correct, the home serviceprovider shall provide a written explanation to the customer. The proceduresin this section shall be the first course of remedy available to customersseeking correction of assignment of place of primary use or taxingjurisdiction, or a refund of or other compensation for taxes, charges, and/orfees erroneously collected by the home service provider, and no cause ofaction based upon a dispute arising from such taxes, charges, or fees shallaccrue until a customer has reasonably exercised the rights and proceduresset forth in this subsection.

8. For the purposes of this subsection, the terms "customer," "enhancedzip code," "home service provider," "licensed service area," "servingcarrier," and "taxing jurisdiction" shall have the meaning attributed tothem by the federal Mobile Telecommunications Sourcing Act, 4 U.S.C. 124,as amended.

L. 1. For purposes of this article, a bundled transaction of servicesincludes services taxed under this section and consists of distinct andidentifiable properties, services, or both, sold for one nonitemized chargefor which the tax treatment of the distinct properties and services isdifferent.

2. In the case of a bundled transaction described in subdivision L 1, if thecharge is attributable to services that are taxable and services that arenontaxable, the portion of the charge attributable to the nontaxable servicesshall be subject to tax unless the provider can reasonably identify suchnontaxable portion from its books and records kept in the regular course ofbusiness.

3. In the case of a bundled transaction described in subdivision L 1, if thecharge for such services is attributable to services that are subject to taxat different rates, the total charge shall be treated as attributable to theservices subject to tax at the highest rate unless the provider canreasonably identify the portion of the charge attributable to the servicessubject to tax at a lower rate from its books and records kept in the regularcourse of business for other purposes.

M. As used in this article, unless the context clearly requires otherwise:

"Affiliated group" shall have the same meaning ascribed to it insubdivision C 10 of 58.1-3703, except, for purposes of this article, theword "entity" shall be substituted for the word "corporation" whenever itis used in that section.

"Bad debts" means any portion of a debt related to a sale of localtelecommunication services, the gross charges for which are not otherwisedeductible or excludable, that has become worthless or uncollectible, asdetermined under applicable federal income tax standards. If the portion ofthe debt deemed to be bad is subsequently paid, the service provider shallreport and pay the tax on that portion during the reporting period in whichthe payment is made.

"Consumer" means a person who, individually or through agents, employees,officers, representatives, or permittees, makes a taxable purchase of localtelecommunication services.

"Enhanced services" means services that employ computer processingapplications to act on the format, code, or protocol or similar aspects ofthe information transmitted; provide additional, different, or restructuredinformation; or involve interaction with stored information.

"Gross charges" means, subject to the exclusions of this section, theamount charged or paid for the taxable purchase of local telecommunicationservices. However, "gross charges" shall not include the following:

1. Charges or amounts paid that vary based on the distance and/or elapsedtransmission time of the communication that are separately stated on theconsumer's bill or invoice.

2. Charges or amounts paid for customer equipment, including such equipmentthat is leased or rented by the customer from any source, if such charges oramounts paid are separately identifiable from other amounts charged or paidfor the provision of local telecommunication services on the serviceprovider's books and records.

3. Charges or amounts paid for administrative services, including, withoutlimitation, service connection and reconnection, late payments, and roamerdaily surcharges.

4. Charges or amounts paid for special features that are not subject totaxation under 4251 of the Internal Revenue Code of 1986, as amended.

5. Charges or amounts paid that are (i) the tax imposed by 4251 of theInternal Revenue Code of 1986, as amended or (ii) any other tax or surchargeimposed by statute, ordinance or regulatory authority.

6. Bad debts.

"Local telecommunication service," subject to the exclusions stated in thissection, includes, without limitation, the two-way local transmission ofmessages through use of switched local telephone services; telegraphservices; teletypewriter; or local mobile telecommunications service.

"Local telephone service," subject to the exclusions stated in thissection, includes any service subject to federal taxation as local telephoneservice as that term is defined in 4252 of the Internal Revenue Code of1986, as amended, or any successor statute.

"Mobile service consumer" means a person having a telephone number forlocal mobile telecommunications service who has made a taxable purchase ofsuch service or on whose behalf another person has made a taxable purchase ofsuch service.

"Mobile telecommunications service" means commercial mobile radio service,as defined in 47 C.F.R. 20.3, as in effect on June 1, 1999.

"Place of primary use" means the street address representative of where thecustomer's use of the mobile telecommunications service primarily occurs,which must be the residential street address or the primary business streetaddress of the customer and within the licensed service area of the homeservice provider.

"Residential consumer" shall not include any consumer of mobile localtelecommunication service.

"Service address" means the location of the telecommunication equipmentfrom which the telecommunication is originated or at which thetelecommunication is received by a consumer. However, if the service addressis not a defined location, as in the case of maritime systems, air-to-groundsystems and the like, service address shall mean the location of thesubscriber's primary use of the telecommunication equipment within thelicensed service area. In the case of mobile telecommunications service,service address shall mean the customer's place of primary use.

"Service provider" means every person engaged in the business of sellinglocal telecommunication services to consumers.

"Taxable purchase" means the acquisition of telecommunication services forconsumption or use; however, taxable purchase does not include (i) theprovision of telecommunications among members of an affiliated group ofentities by a member of the group for their own exclusive use and consumptionand (ii) the purchase of telecommunications for resale in the subsequentprovision of telecommunications, including, without limitation, carrieraccess charges, right of access charges, and charges for use of intercompanyfacilities; however, the acquisition of telecommunications by a provider ofenhanced services is not the purchase of telecommunications for resale, evenwhen the cost of the telecommunications is separately stated to the purchaserof the enhanced services, as long as the primary object of the purchase ofthe telecommunications by the provider is for the provision of enhancedservices and not telecommunications. A person may make tax-free purchases oftelecommunications for resale if the person provides to the service providera sworn affidavit indicating that the person's purchases are nontaxable salesfor resale.

(Code 1950, 58-587.1; 1966, c. 540; 1972, cc. 459, 637; 1975, c. 55; 1976,c. 565; 1982, c. 616; 1984, cc. 154, 675; 1986, c. 38; 1994, c. 560; 1995,cc. 553, 590; 1997, c. 252; 1998, c. 337; 2000, cc. 375, 1064; 2002, cc. 17,68; 2003, cc. 160, 179; 2004, cc. 43, 172, 489, 516; 2005, c. 206.)