                                 CODE OF VIRGINIA

ADDITIONAL LOCAL USE TAX IN CERTAIN LOCALITIES; USE OF REVENUES FOR CONSTRUCTION
OR RENOVATION OF SCHOOLS (§ 58.1-606.1)

A. 1. The governing body of a qualifying locality may levy a use tax at the rate
of such sales tax under § 58.1-605.1 to provide revenue for capital projects
for the construction or renovation of schools in such locality. Such tax shall
be added to the rates of the state and local use tax imposed by this chapter and
shall be subject to all the provisions of this chapter, and all amendments
thereof, and the rules and regulations published with respect thereto, except
that no discount under § 58.1-622 shall be allowed on a local use tax.

   2. Any tax imposed pursuant to this section shall expire (i) if the capital
   projects for the construction or renovation of schools are to be financed by
   bonds or loans, on the date by which such bonds or loans shall be repaid or
   (ii) if the capital projects for the construction or renovation of schools are
   not to be financed by bonds or loans, on a date chosen by the governing body
   and specified in any resolution passed pursuant to the provisions of
   subsection B. Such expiration date shall not be more than 20 years after the
   date of the resolution passed pursuant to the provisions of subsection B.

B. The governing body of the qualifying locality, if it elects to impose a local
use tax under this section may do so only if it has previously imposed the local
sales tax authorized by &#xA7; 58.1-605.1, by the adoption of an ordinance
stating its purpose and referring to this section and providing that the local
use tax shall become effective on the first day of a month at least 120 days
after its adoption. Such ordinance shall state the date on which the use tax
shall expire. A certified copy of such ordinance shall be forwarded to the Tax
Commissioner so that it will be received within five days after its adoption.

C. Any local use tax levied under this section shall be administered and
collected by the Tax Commissioner in the same manner and subject to the same
exemptions and penalties as provided for the state use tax; however, the local
use tax levied under this section shall not be levied on food purchased for
human consumption or essential personal hygiene products, as such terms are
defined in &#xA7; 58.1-611.1.

D. The local use tax authorized by this section shall not apply to transactions
to which the sales tax applies, the situs of which for state and local sales tax
purposes is the locality of location of each place of business of every dealer
paying the tax to the Commonwealth without regard to the locality of possible
use by the purchasers. However, the local use tax authorized by this section
shall apply to tangible personal property purchased outside the Commonwealth for
use or consumption within the locality imposing the local use tax, or stored
within the locality for use or consumption, where the property would have been
subject to the sales tax if it had been purchased within the Commonwealth. The
local use tax shall also apply to leases or rentals of tangible personal
property where the place of business of the lessor is outside the Commonwealth
and such leases or rentals are subject to the state tax. Moreover, the local use
tax shall apply in all cases in which the state use tax applies.

E. Out-of-state dealers who hold certificates of registration to collect the use
tax from their customers for remittance to the Commonwealth shall, to the extent
reasonably practicable, in filing their monthly use tax returns with the Tax
Commissioner, break down their shipments into the Commonwealth by counties and
cities so as to show the county or city of destination. If, however, the
out-of-state dealer is unable accurately to assign any shipment to a particular
county or city, the local use tax on the tangible personal property involved
shall be remitted to the Commonwealth by such dealer without attempting to
assign the shipment to any county or city.

F. Local use tax revenue shall be deposited in the special fund established
pursuant to subsection E of &#xA7; 58.1-605.1. The Comptroller shall distribute
the revenue to the qualifying locality.

G. All revenue from this local use tax revenue shall be used solely for capital
projects for new construction or major renovation of schools in the qualifying
locality, including bond and loan financing costs related to such construction
or renovation.

HISTORY: 2019, c. 648; 2020, cc. 327, 427, 428, 705, 708, 865.