Agenda 02/09/1999 - Laserfiche WebLink

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Enclosure #4 EXPLANATIONS OF SUGGESTED AMENDMENTS TO MARTINSVILLE BPOL ORDINANCE SECTIONS SECTION 11-31 CHANGES: 1. Adding new subsection (b) (11): Excluding the value of trade-ins from gross receipts of motor vehicle dealers is currently required by Virginia Code Section 58.1-3734.1. This simply elirifles the BPOL ordinance by making it an all inclusive ordinance rather than omitting this important qualification of gross receipts taxation of vehicle dealers. It was probably an oversight that this was omitted from the BPOL ordinance initially. 2. Adding new subsections (b) (12) and (13): These "breaks" for funeral services and PEO/temporary worker agencies were added by the 1998 General Assembly. See new Virginia Code Sections 58.1-3732.3 and 58.1-3732.4. Adding these new subsections to Section 11-31 simply makes the ordinance conform to the statutory changes made in the last legislative session. 3. Adding new subsection (f): Taxing commission merchants only on their commission income rather than gross receipts from their sales is currently required by Virginia Code Section 58.1-3733. This is also a clarification of the BPOL ordinance, which was intended to be an all inclusive ordinance. Its omission was also probably an oversight in the initial ordinance. SECTION 11-34 CHANGE: Change in subsection (a): The current BPOL ordinance provides a blanket exemption for all non-profit organizations, with no exceptions for any business ventures they may engage in for which the city could require a business license and collect gross receipts taxes under Virginia Code Section 58.1-3703 C, as revised by the 1998 General Assembly. Obviously, Code Section 58.1-3703 C would exempt the businesses listed there anyway, including non- profit organizations meeting Federal tax requirements for such classification. However, Code Section 58.1-3703 C would allow the city to require a business license and collect gross receipts taxes on a charitable non-profit organization' s "receipts from an unrelated trade or business the income of which is taxable under Internal Revenue Code § 511 et seq." and on other non-profit organization's "[a]ctivities conducted for consideration which are similar to activities conducted for consideration by for-profit businesses .... " The suggested change would close a loophole that might allow some non-profit organizations to conduct businesses in competition with for-profit businesses without having to have business licenses or pay gross receipts taxes.