AN AMENDED ORDINANCE IMPOSING MUNICIPAL SALES AND SERVICE TAX AND MUNICIPAL USE TAX IN ACCORDANCE WITH WEST VIRGINIA CODE 8-13C-4(b) AND 8-13C-5(b) BY THE TOWN OF WAYNE, WEST VIRGINIA Definitions: For the purpose of application, interpretation, and construction of this Ordinance, the definitions as set forth in West Virginia Code Chapter 11, Articles 15, 15A and 15B, shall apply, and the definitions therein are fully incorporated herein by reference. Imposition of a Municipal Sales and Service Tax: In accordance with the authority as set forth in West Virginia Code 8-13C-4(b), effective on the first day of January, 2018, there is hereby imposed upon all persons or entities engaging in business within the municipal boundaries of the Town of Wayne a Municipal Sales and Service Tax in an amount equal to one percent (1%) on all sales of tangible personal property, custom software, and taxable services rendered within the boundaries of the municipality of the Town of Wayne, subject to the following: (1) The base of the Municipal Sales and Service Tax imposed herein shall be identical to the base of the Consumers Sales and Service Tax imposed pursuant to the provisions of West Virginia Code Chapter 11, Article 15; and (2) Except for the exemption provided in West Virginia Code 11-15-9f, all exemptions and exceptions from Consumers Sales and Service Tax apply to this Municipal Sales and Service Tax; and (3) Sales of motor vehicles subject to the tax imposed under West Virginia Code 11-15-3c and sales of gasoline and special fuel are not subject to the Municipal Sales and Service Tax herein imposed; and (4) The Municipal Sales and Service Tax herein imposed is subject to the sourcing rules set forth in West Virginia Code Chapter 11, Article 15B. Imposition of a Municipal Use Tax: In accordance with the authority set forth in West Virginia Code 8-13C-5(b), effective on and after the first day of January, 2018, a Municipal Use Tax is hereby levied and imposed on the use within the Town of Wayne oftangible personal property, custom software, and taxable services, at the rate of one percent (1%) of the purchase price of such property or taxable services, subject to the following: (1) The base of the Municipal Use Tax herein imposed shall be identical to the base of the use tax imposed pursuant to West Virginia Code Chapter 11, Article 15A; and (2) Except for the exemptions provided in West Virginia Code 11-15-9f, all exemptions and exceptions from the use tax imposed pursuant to West Virginia Code Chapter 11, Article 15A apply to the Municipal Use Tax herein imposed; and (3) Uses of motor vehicles subject to the tax imposed under West Virginia Code 11-15-3c and uses of gasoline and special fuel are not subject to the Municipal Use Tax herein imposed: and (4) The Municipal Use Tax herein imposed is subject to the sourcing rules set forth in West Virginia Code Chapter 11, Article 15B. Credit Against Municipal Use Tax: A person or entity is entitled to a credit against the Municipal Use Tax herein imposed on the use of a particular item of tangible personal property, custom software or services equal to the amount, in any, of sales tax lawfully paid to another municipality for the acquisition of the property or service; provided, the amount of the credit allowed shall not exceed the amount of Municipal Use Tax imposed on the use of the property or service in the Town of Wayne. For purposes of this Ordinance the following definitions shall apply: (1) "Municipality" means a municipality, as defined in West Virginia Code 8-1-2, or a comparable unit or entity of local government in another State; and (2) "Sales Tax" includes a sales tax or compensating use tax lawfully imposed on the use of tangible personal property, custom software or a service by the municipality or county, as appropriate, in which the sale or use occurred; and (3) "State" includes the fifty (50) states of the United States and the District of Columbia, but does not include any of the several territories organized by Congress. No credit is allowed under this Ordinance for payment of any sales or use taxes imposed by this State or any other State. Tax Commissioner Shall Administer, Enforce and Collect Taxes: The services of the West Virginia State Tax Commissioner shall be used to administer, enforce and collect the Municipal Sales and Service Tax and Municipal Use Tax herein imposed and the City shall coordinate such services with the West Virginia State Tax Department. Municipal Taxes Imposed in Addition to Consumer Sales and Service Tax and Consumer Use Tax: The Municipal Consumers Sales and Service Tax and Municipal Use Tax imposed pursuant to this Ordinance shall be in addition to the Consumers Sales and Service Tax and Municipal Use Tax imposed pursuant to West Virginia Code Chapter 11, Articles 15 and 15A, on sales made and services rendered and taxable uses of tangible personal property, custom software, and taxable services within the boundaries of the municipality of the Town of Wayne and, except as exempted or excepted, all sales made and services rendered and taxable uses of tangible personal property, custom software and taxable services within the boundaries of the municipality of the Town of Wayne shall remain subject to the tax levied by these Articles. Further, the Municipal Sales and Service Tax and Municipal Use Tax imposed pursuant to this Ordinance shall be imposed in addition to any tax imposed pursuant to the provisions of West Virginia Code 7-22-1, 8-13-6, 8-13-7, and 8-38-12, respectively. BASIS OF AMENDMENT: By prior Ordinance, the Mayor and City Council of the Town of Wayne, West Virginia, finally adopted on December 30, 2016, a Municipal Sales and Service Tax and a Municipal Use Tax, which fundamentally altered the nature of the tax levied upon the Town (see prior Ordinance so establishing). However, said Municipal Sales and Service Tax and Municipal Use Tax was not to be effective until July 1, 2017. Subsequent to the above passed Ordinance, and as required to fully implement the new tax system above, the Mayor and City Council finally adopted an Ordinance that rescinded, abolished and otherwise rendered void and of no effect the Business and Occupation Tax. However, said Ordinance by its very language held the effective date for the action as June 30, 2017, the day before the intended effective date of the new tax system above. Despite appearing facially that both Ordinances were fully compliant with the applicable laws and regulations, the Town of Wayne has received information from the WV State Tax Department by its letter of June 16, 2017, that insofar as both the above Ordinances were not finally adopted contemporaneously, that the agency has found based upon its interpretation of the relevant code that the Town of Wayne was without authority to finally adopt the Municipal Sales and Service Tax and Municipal Use Tax, insofar as at the time of its passage, the Ordinance eliminating the Business and Occupation Tax had also not been finally adopted. For this reason, the WV State Tax Department advised in its letter that it was denying the Town of Wayne's Ordinance creating the Municipal Sales and Service Tax and the Municipal Use Tax, making it necessary to amend both of the prior Ordinances to comply fully with the legal requirements. Effective Date: In the event the Town of Wayne finally adopts this Ordinance, it shall take effect upon its adoption, provided that the imposition, administration, collection and enforcement of the municipal sales and use taxes are hereby delayed and shall have no force or effect until the first day of January or the first day of January, or first day of July, that begins one hundred and eighty days after passage of this Ordinance and a certified copy of the ordinance has been given to the State Tax Commissioner, all in accordance with the requirements of W. Va. Code St. R. 110-28-8. PASSED ON FIRST READING by majority vote of the Governing Body of the Town of Wayne, West Virginia, this 21st day of June, 2017. The matter will come for second reading/public hearing/final adoption by the Town of Wayne Council at a meeting on June 30, 2017 at Town Hall at noon. PREPARED BY: Kendal E. Partlow, Esq. PARTLOW LAW OFFICES 27495 East Lynn Rd Wayne, WV 25570 LH-53627 6-24,28; 2017
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