Taxpayers conducting business in West Virginia are reminded that effective October 1, 2013, the cities of Charleston, Harrisville, Quinwood and Wheeling have imposed a municipal (or local) sales and use tax. The municipal rate is 0.5% in Charleston and Wheeling and 1% in Harrisville and Quinwood, respectively. These four cities join Huntington, Rupert and Williamstown in imposing municipal sales and use taxes.
The local sales tax is imposed in the same manner as the state sales tax in terms of tax base and exemptions. The municipal sales and use tax is destination-based, meaning the tax must be collected or paid based on the location where the product or service is shipped or used. Any taxpayer registered with the West Virginia Tax Department to collect sales tax that is “doing business” in a municipality that imposes the local sales and use tax must collect the local tax. “Doing business” includes having an office, physical location or representative as well as shipping or delivering product in the area or performing taxable services.
The local use tax applies to consumers when the vendor does not charge the municipal sales tax. This normally occurs when purchasing taxable products or services from an out-of-state vendor.
Taxpayers, retailers and service providers should review their records and tax systems to verify that the municipal sales and use tax is properly applied.
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This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax related matter.