AN ACT RELATING TO MISCELLANEOUS TAX AMENDMENTS
It is hereby enacted by the General Assembly of the State of Vermont:
* * * Sales Tax and Use * * *
Sec. 1. 32 V.S.A. § 9707 is amended to read:
§ 9707. Registration
(a) Before commencing business or opening new places of business, every person required to collect any tax imposed by this chapter and every person purchasing tangible personal property for resale shall apply for a license in the manner prescribed by the commissioner. The commissioner shall issue, without charge, to each registrant a license empowering him or her to collect the tax. Each license shall state the place of business to which it is applicable. The license shall be prominently displayed in the place of business of the registrant. A registrant who has no regular place of doing business shall attach the license to his or her cart, stand, truck, or other merchandising device, or carry it on his or her person. The licenses shall be nonassignable and nontransferable and shall be surrendered to the commissioner immediately upon the registrant’s ceasing to do business at the place named.
(b) No later than one business day prior to an event at which taxable sales will be made by vendors who have no permanent place of business in the state, the promoter of the event shall provide to the commissioner a list of vendors who are authorized by the promoter to sell taxable property at the event and the vendors’ current sales tax license numbers. No later than one week after the event the promoter shall notify the department in writing of any changes to the list of participating vendors and their sales tax license numbers. In this subsection, “event” means a specific time and location at which 25 or more vendors are authorized by the promoter to sell taxable items.
(c) Any person who is not otherwise required to collect any tax imposed by this chapter and who makes sales to persons within the state of tangible personal property or services, the use of which is subject to tax under this chapter, may register with the commissioner who may, in his or her discretion and subject to such conditions as he or she may impose, issue to him or her a certificate of authority to collect the compensating use tax imposed by this chapter.
Sec. 2. 32 V.S.A. § 9741(38) is amended to read:
Retail sales and use of the following shall be exempt from the tax on retail sales imposed under section 9771 of this title and the use tax imposed under section 9773 of this title.
* * *
(38) Tax on the
or use of a tracked vehicle shall not exceed $900.00 $1,150.00
adjusted as follows: As of July 1 of each odd‑numbered year, the
commissioner shall adjust the most recent unrounded cap amount by the
cumulative inflation index for the prior two calendar years under the Consumer
Price Index for Urban Consumer All Items, and round that amount to the nearest
ten dollars, and shall publish this rounded amount as the new cap.
Sec. 3. STUDY OF PURCHASE AND USE TAX CAP INFLATION INDEX
The commissioner of motor vehicles shall study the advisability of indexing the cap on purchase and use tax for inflation, and shall report her recommendation to the House Committee on Ways and Means by January 15, 2006.
Sec. 4. NET OPERATING LOSS STUDY
In order to take a reasoned action on changing the structure of Vermont net operating loss law, the House Committee on Ways and Means requests that the Joint Fiscal Office and the Department of Taxes study the possible effects of amending the law to allow 50 percent of federal corporate net operating loss carrybacks and carryforwards to be carried forward in Vermont, based on loss‑year apportionment factors, for a period of up to ten years, beginning with the 2007 taxable year, and of phasing the allowable percentage up from 50 percent to 100 percent by 2010. In analyzing the proposed change, the study group shall quantify the effects upon the general fund, compare the tax liabilities of corporate taxpayers under the current system and under the proposed change, analyze the interaction of the net operating loss carryforward law and unitary combined reporting, and compare the proposed change to other states’ corporate net operating loss provisions; and shall report its findings and any proposed legislation to the House Committee on Ways and Means by January 15, 2006.
Sec. 5. Sec. 62 of No. 143 of the Acts of the 2001 Adj. Sess. (2002) is amended to read:
Sec. 62. Sec. 277 of No. 62 of the Acts of 1999 is amended to read:
Sec. 277. EFFECTIVE DATES
* * *
Sec. 272 shall be effective on passage
, and the provisions in Sec. 272
providing a property transfer tax exemption shall be repealed on July 1, 2006.
Sec. 6. 32 V.S.A. § 3481(1) is amended to read:
§ 3481. DEFINITIONS
The following definitions shall apply in this Part and chapter 101 of this title, pertaining to the listing of property for taxation:
value” shall mean, with respect to property enrolled in a use value appraisal
program, the use value appraisal as defined in
3752(12) of this title, multiplied by the common level of appraisal, and with
respect to all other property, the estimated fair market value. The estimated
fair market value of a property is the price which the property will bring in
the market when offered for sale and purchased by another, taking into
consideration all the elements of the availability of the property, its use
both potential and prospective, any functional deficiencies, and all other
elements such as age and condition which combine to give property a market
value. Those elements shall include a consideration of a decrease in value
due to a housing subsidy covenant as defined in section 610 of Title 27, or
the effect of any state or local law or regulation affecting the use of land,
including but not limited to chapter 151 of Title 10 or any land capability
plan established in furtherance or implementation thereof, rules adopted by the
state board of health and any local or regional zoning ordinances or
development plans. In determining estimated fair market value, the sale price
of the property in question is one element to consider, but is not solely
For residential rental property that is subject to a housing subsidy covenant or other legal restriction, imposed by a governmental, quasi‑governmental, or public purpose entity, on rents that may be charged, fair market value shall be determined by an income approach using the following elements:
(A) market rents with utility allowance adjustments for the geographic area in which the property is located as determined by the federal office of Housing and Urban Development;
(B) actual expenses incurred with respect to the property as provided by the property owner and certified by an independent third party;
(C) a vacancy rate that is 50 percent of the market vacancy rate as determined by the United States Census Bureau with local review by the Vermont housing finance agency; and
(D) a capitalization rate that is typical for the geographic area determined and published annually prior to April 1 by the division of property valuation and review after consultation with the Vermont housing finance agency.
Sec. 7. 32 V.S.A. § 5930u(a)(5) and (c) are amended to read:
(5) “Credit certificate” means a certificate issued by the allocating agency to a taxpayer that specifies the amount of affordable housing tax credits that can be applied against the taxpayer’s individual or corporate income tax or franchise or insurance premium tax liability as provided in this subchapter.
of credit. A taxpayer who makes an eligible cash contribution shall be
entitled to claim against the taxpayer’s individual income, corporate,
franchise, or insurance premium tax liability a credit in an
amount specified on the taxpayer’s credit certificate.
Sec. 8. INCOME TAX CREDIT ALTERNATIVE FOR NONPROFIT
A nonprofit organization which was issued an income tax credit under 32 V.S.A. § 5930p or 5930q before January 1, 2005, and which was unable to apply the credit to an income tax liability or to a mortgage debt related to the qualified building, may transfer the tax credit allocation to a bank, which may accept it in return for cash. A bank which purchases a credit allocation under this provision may use it to reduce its bank franchise tax liability under 32 V.S.A. § 5836 for taxable year 2006.
Sec. 9. 24 V.S.A. § 138(a) is amended to read:
(a) Local option taxes are authorized under this section for the purpose of affording municipalities an alternative method of raising municipal revenues to facilitate the transition and reduce the dislocations in those municipalities that may be caused by reforms to the method of financing public education under the Equal Educational Opportunity Act of 1997. Accordingly:
local option taxes authorized under this section may be imposed by a
municipality only during calendar years 1999 through
municipality opting to impose a local option tax may do so prior to July 1,
1998 to be effective beginning January 1, 1999, and anytime after December 1,
1998 a local option tax shall be effective beginning on the next tax quarter
following 30 days’ notice to the department of taxes of the imposition; and all
authority to opt to impose a local option tax under this section shall
terminate September 1,
2007 2010, and all authority to impose a
local option tax shall terminate on December 31, 2008 2011; and
* * *
Sec. 10. Sec. 15 of No. 152 of the Acts of the 2003 Adj. Sess. (2004) is amended to read:
Sec. 15. 24 V.S.A. § 138(a) is amended to read:
§ 138. LOCAL OPTION TAXES
* * *
(2) a municipality opting to impose a local option
tax may do so prior to July 1, 1998 to be effective beginning January 1, 1999,
and anytime after December 1, 1998 a local option tax shall be effective
beginning on the next tax quarter following
30 90 days’ notice to
the department of taxes of the imposition; and all authority to opt to impose a
local option tax under this section shall terminate September 1, 2007 2010,
and all authority to impose a local option tax shall terminate on December 31, 2008
* * *
Sec. 11. EFFECTIVE DATES
(a) This section shall take effect upon passage.
(b) Sec. 1 of this act (promoter’s list of vendors at an event) shall take effect upon passage.
(c) Sec. 2 of this act (cap on sales tax for tracked vehicles) shall apply to sales on and after July 1, 2005, and the first adjustment of the cap for inflation shall be July 1, 2007.
(d) Sec. 3 of this act (study of purchase and use tax cap inflation index) shall take effect upon passage.
(e) Sec. 4 of this act (net operating loss study) shall take effect upon passage.
(f) Sec. 5 of this act (repeal of sunset of property transfer tax exemption for VHFA-financed housing) shall take effect upon passage.
(g) Sec. 6 of this act (method for appraising affordable housing) shall apply to grand lists of April 1, 2006, and after.
(h) Sec. 7 of this act (extension of affordable housing tax credits to insurance premiums tax) shall take effect upon passage.
(i) Sec. 8 of this act (tax credit alternative for nonprofit entities with building rehabilitation credits and no mortgage debt) shall take effect upon passage.
(j) Secs. 9 and 10 (extension of sunset on local option taxes to 2011) shall take effect upon passage.
The Vermont General Assembly
115 State Street