Updated TAX guidelines

July 5, 2013

VACo Memorandum

TO: County Administrators

FROM: Dean A. Lynch, CAE, Deputy Executive Director

SUBJECT: TAX law changes

DATE: July 3

Copy: VACo Finance Steering Committee, VACo Compensation and Retirement Steering Committee, County Liaisons

County Administrators:

Please be aware that TAX (Virginia Dept. of Tax) has updated taxing guidelines for Motor Vehicle Rental, Port Volume Increase and Insurance Premiums. These updates reflect 2013 legislative amendments to the Virginia Tax Code, effective July 1, 2013. All three sets of guidelines have been published on the Laws, Rules and Decisions section of the Department’s website and on the Virginia Regulatory Town Hall website.

New Guidelines Released
During the 2013 session, the General Assembly enacted several bills that amended existing tax laws.  These legislative changes required  non-discretionary modifications to three sets of previously published guidelines issued by the Department of Taxation (“the Department”). Accordingly, to ensure consistency with the recently enacted legislation, the Department has published updated Motor Vehicle Rental Tax Guidelines, Port Volume Increase Tax Credit Guidelines, and Insurance Premiums License Tax Guidelines.  As no agency discretion was involved in conforming to the relevant legislation, each set of Guidelines was updated without public participation. The updated guidelines supersede any prior guidelines that were published by the Department.

Motor Vehicle Rental Tax Guidelines
Effective for rentals of motor vehicles occurring on and after July 1, 2013, House Bill 1993 (Acts of Assembly 2013, Chapter 84) excludes certain charges from “gross proceeds” for the purposes of the Motor Vehicle Rental Taxes and Fee.  The Guidelines for the Motor Vehicle Rental Taxes and Fee have been updated to reflect this change and the updated Guidelines have been published as Public Document 13-109.

Port Volume Increase Tax Credit Guidelines
Effective for taxable years beginning on or after January 1, 2013, House Bill 1824 (Acts of Assembly of 2013, Chapter 744) expands which taxpayers may claim the Port Volume Increase Tax Credit to include agricultural entities, manufacturing-related entities, and mineral and gas entities.  Under prior law, only taxpayers engaged in the manufacturing of goods or the distribution of manufactured goods were eligible for the credit.  The Port Volume Increase Tax Credit Guidelines have been updated to reflect this change and the updated Guidelines have been published as Public Document 13-123.

Insurance Premiums License Tax Guidelines
Effective for taxable years commencing on or after January 1, 2013, House Bill 2155 (Acts of Assembly of 2013, Chapter 29) and Senate Bill 1216 (Acts of Assembly of 2013, Chapter 163) make several technical changes related to the administration of the Insurance Premiums License Tax.  This legislation includes several changes to the interest rate applied to underpayments of tax by insurance companies, the Insurance Premiums License Tax payment and billing deadlines, and the provisions for disclosure of information related to the Insurance Premiums License Tax.  The Insurance Premiums License Tax Guidelines have been updated to reflect these changes and the updated Guidelines have been published as Public Document 13-122.

Where to Find the Published Guidelines
All three sets of guidelines have been published on the Laws, Rules and Decisions section of the Department’s website and on the Virginia Regulatory Town Hall website

If you have additional questions, please visit the Department’s website at http://www.tax.virginia.gov, or contact the Department at (804) 367-8031 for individual income tax questions or (804) 367-8037 for business tax questions.

Topic Tags: Dean Lynch, Tax, VACoMemo

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