10102517D
HOUSE BILL NO. 1138
Offered January 13, 2010
Prefiled January 13, 2010
A BILL to amend and reenact § 58.1-3833 of the Code of
Virginia, relating to county food and beverage tax.
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Patron-- Morgan
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Referred to Committee on Finance
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Be it enacted by the General Assembly of Virginia:
1. That § 58.1-3833 of the Code of Virginia is
amended and reenacted as follows:
§58.1-3833. County food and beverage tax.
A. Any Subject to the provisions of subsection B, any
county is hereby authorized to levy a tax on food and beverages sold, for human
consumption, by a restaurant, as such term is defined in subdivision 9 of §
35.1-1, not to exceed four percent of the amount charged for such food and
beverages. Such tax shall not be levied on food and beverages sold through
vending machines or by: (i) boardinghouses that do not accommodate transients;
(ii) cafeterias operated by industrial plants for employees only; (iii)
restaurants to their employees as part of their compensation when no charge is
made to the employee; (iv) volunteer fire departments and rescue squads;
nonprofit churches or other religious bodies; educational, charitable,
fraternal, or benevolent organizations, on an occasional basis, not exceeding
three times per calendar year as a fundraising activity, the gross proceeds of
which are to be used by such church, religious body or organization exclusively
for nonprofit educational, charitable, benevolent, or religious purposes; (v)
churches that serve meals for their members as a regular part of their
religious observances; (vi) public or private elementary or secondary schools,
colleges, and universities to their students or employees; (vii) hospitals,
medical clinics, convalescent homes, nursing homes, or other extended care
facilities to patients or residents thereof; (viii) day care centers; (ix)
homes for the aged, infirm, handicapped, battered women, narcotic addicts, or
alcoholics; or (x) age-restricted apartment complexes or residences with
restaurants, not open to the public, where meals are served and fees are
charged for such food and beverages and are included in rental fees. Also, the
tax shall not be levied on food and beverages: (a) when used or consumed and
paid for by the Commonwealth, any political subdivision of the Commonwealth, or
the United States; or (b) provided by a public or private nonprofit charitable
organization or establishment to elderly, infirm, blind, handicapped, or needy
persons in their homes, or at central locations; or (c) provided by private
establishments that contract with the appropriate agency of the Commonwealth to
offer food, food products, or beverages for immediate consumption at concession
prices to elderly, infirm, blind, handicapped, or needy persons in their homes
or at central locations.
Grocery stores and convenience stores selling prepared foods
ready for human consumption at a delicatessen counter shall be subject to the
tax, for that portion of the grocery store or convenience store selling such
items.
This tax shall be
levied only if the tax is approved in a referendum within the county which
shall be held in accordance with §24.2-684 and initiated either by a
resolution of the board of supervisors or on the filing of a petition signed by
a number of registered voters of the county equal in number to 10 percent of
the number of voters registered in the county, as appropriate on January 1 of
the year in which the petition is filed with the court of such county. The
clerk of the circuit court shall publish notice of the election in a newspaper
of general circulation in the county once a week for three consecutive weeks
prior to the election. If the voters affirm the levy of a local meals tax, the
tax shall be effective in an amount and on such terms as the governing body may
by ordinance prescribe. If such resolution of the board of supervisors or such
petition states for what projects and/or purposes the revenues collected from
the tax are to be used, then the question on the ballot for the referendum
shall include language stating for what projects and/or purposes the revenues
collected from the tax are to be used.
The term "beverage" as set forth herein shall mean
alcoholic beverages as defined in §4.1-100 and nonalcoholic beverages served
as part of a meal. The tax shall be in addition to the sales tax currently
imposed by the county pursuant to the authority of Chapter 6 (§58.1-600 et
seq.) of this title. Collection of such tax shall be in a manner prescribed by
the governing body.
B. Notwithstanding the
provisions of subsection A of this section, Roanoke County, Rockbridge County,
Frederick County, Arlington County, and Montgomery County, are hereby
authorized to levy a tax on food and beverages sold for human consumption by a
restaurant, as such term is defined in §35.1-1 and as modified in subsection A
above and subject to the same exemptions, not to exceed four percent of the
amount charged for such food and beverages, provided that the governing body of
the respective county holds a public hearing before adopting a local food and
beverage tax, and the governing body by unanimous vote adopts such tax by local
ordinance. The tax shall be effective in an amount and on such terms as the
governing body may by ordinance prescribe. The local governing body of every county in which the
food and beverage tax is imposed for the first time or
increased on or after July 1, 2010, shall use the
revenues from such tax to reduce such county's real property tax rate.
C. Nothing herein contained shall affect any authority
heretofore granted to any county, city or town to levy a meals tax. The county
tax limitations imposed pursuant to §58.1-3711 shall apply to any tax levied
under this section, mutatis mutandis. All food and beverage tax collections and
all meals tax collections shall be deemed to be held in trust for the county,
city or town imposing the applicable tax. The wrongful and fraudulent use of
such collections other than remittance of the same as provided by law shall
constitute embezzlement pursuant to §18.2-111.
D. No county which has
heretofore adopted an ordinance pursuant to subsection A of this section shall
be required to submit an amendment to its meals tax ordinance to the voters in
a referendum.
E. Notwithstanding
any other provision of this section, no locality shall levy any tax under this section
upon (i) that portion of the amount paid by the purchaser as a discretionary
gratuity in addition to the sales price; (ii) that portion of the amount paid
by the purchaser as a mandatory gratuity or service charge added by the
restaurant in addition to the sales price, but only to the extent that such
mandatory gratuity or service charge does not exceed 20% 20
percent of the sales price; or
(iii) alcoholic beverages sold in factory sealed containers and purchased for
off-premises consumption or food purchased for human consumption as
"food" is defined in the Food Stamp Act of 1977, 7 U.S.C. §2012, as
amended, and federal regulations adopted pursuant to that act, except for the
following items: sandwiches, salad bar items sold from a salad bar, prepackaged
single-serving salads consisting primarily of an assortment of vegetables, and
nonfactory sealed beverages.
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