Chap. 449.—An ACT to provide for the protection, restoration and development
of the forest resources of the State, and to this end to levy a tax upon persons
engaged in the production of forest products and the manufacture of other
products therefrom; to provide how such tax shall be measured, enforced
and collected; to require the keeping of records and the making of returns;
to appropriate the funds derived from the tax; and to prohibit certain acts
and provide certain penalties. [S 28]

Approved April 2, 1948

Be it enacted by the General Assembly of Virginia:
1. Section 1. As used in this act, the following shall have the
meanings respectively ascribed to them unless the context clearly in-
cates a different meaning: (a) “Person” means and includes individuals,
corporations, partnerships, trusts, associations, and any and all other busi-
ness units, devices and arrangements; (b) “Department” means the De-
partment of Taxation; (c) “Taxpayer” means any person liable for taxes
hereunder; (d) “Producer” means any person engaging in this State in
the business of severing timber, or any other forest products from the
soil, for sale or shipment outside the State in an unmanufactured condi-
tion, whether as owner, lessee, concessionaire or contractor; (e) “Forest
product” includes logs, timber, pulpwood, excelsior wood, chemical wood,
except dead chestnut wood, bolts, billets, cross ties, switch ties, mine
ties, mine props and all other types of forest products used in mines,
poles, piles, fuel wood, posts, all cooperage products, tan bark and
any and all other types of forest products; (f) “Sever” means to fell,
cut or otherwise separate from the soil; (g) “Commissioner” means
the State Tax Commissioner ; (h) “Manufacturer” means the person who
operates a sawmill for the sawing of logs into rough lumber in its various
sizes and forms, or who operates a cooperage mill, veneer mill, excelsior
mill, paper mill, chemical plant or other means for the processing of for-
est products into products other than lumber, or who purchases from the
person who severs cross ties, switch ties, mine ties, mine props, and other
forest products used in connection with mining, piles, poles, except fish
net poles, and as to posts, fuel wood, fish net poles and similar products
the person who severs; (i) “F.O.B. loading out point’’ means loaded on a
railroad car, loaded on a barge or boat, or delivered to place of use by
truck.

Section 2. To provide further for the conservation of the natural
resources of the State by the protection and development of the forest
resources, there is hereby levied, and shall be collected as herein pro-
vided, a tax upon every person engaging in this State in the business of
severing timber or any other forest products from the soil, for sale,
profit or commercial use, whether as owner, lessee, concessionaire or con-
tractor, either as producer or manufacturer as above defined. The tax
hereby imposed is in addition to other taxes now levied and shall be
known as the Forest Products Tax. Such tax, together with interest
and penalties imposed by this act, shall be a lien upon the forest products
so severed, and upon the product or products manufactured therefrom,
until the tax hereby imposed with respect to such forest product shall
have been paid, or until such forest product or the product manufactured
therefrom shall have been sold by the manufacturer thereof.

Section 3. The tax hereby imposed shall be measured at the fol-
lowing rates: (1) On pine and cedar lumber in its various sizes and
forms, including railroad switch ties, bridge timber and dimension stock,
ten cents per thousand feet board measure; and on hardwood, cypress
and all other species, five cents per thousand feet board measure. Where
timber is sold as logs and not converted into lumber or other products in
this State, the rate shall be ten cents per thousand feet log scale, Doyle
Rule, on pine and cedar; and five cents per thousand feet long scale,
Doyle Rule, on other species; except that logs under eight inches in
diameter inside bark at the small end shall be scaled as containing one
foot log scale for each foot length or fraction thereof. (2) On veneer
logs the rate shall be ten cents per thousand board feet log scale, Doyle
Rule, for pine and cedar; and five cents per thousand board feet log
scale, Doyle Rule, for other species. (3) On pulpwood, excelsior wood,
chemical wood, bolts or billets, fuel wood, tan bark and other products
customarily sold by the cord, five cents per standard cord of one hundred
and twenty-eight cubic feet when the species is pine or cedar, and two
cents per cord on all other species. (4) On railroad cross ties one-third
cent per piece on species of pine and cedar, and one-sixth cent per piece
on all other species. (5) On posts, and mine ties, mine props, round
mine collars and other types of timber used in connection with mining
and ordinarily sold by the piece, the rate per one hundred pieces shall
be as follows: where each piece is four feet or less in length, four cents
for pine and cedar and two cents for other species; and where each
Piece is more than four feet but not over eight feet in length, six and
one-half cents for one pine and cedar and three and one-fourth cents
for other species ; and where each piece is more than eight feet in length,
eight cents for pine and cedar and four cents for other species; or if
the taxpayer elects, he may pay the taxes due on the above forest pro-
ducts at the rate of eleven cents per one thousand lineal ft. for pine
and cedar and five and one-half cents for other species. (6) On piling
and poles of all types, one-seventh of one per cent on invoice value FOB
loading out point. (7) On keg staves the rate shall be one-third cent per
standard four hundred inch bundle and one cent per hundred keg
heads, and on tight cooperage, one cent per one hundred staves and two
cents per one hundred heads.

On any other type of forest product not herein enumerated, severed
or separated from the soil, the Commissioner shall determine a fair unit
tax rate, based on the cubic foot wood volume relationship between the
product and the cubic foot volume of one thousand feet board measure
of pine or cedar lumber when the product is pine or cedar, or on the
unit rate of hardwood lumber when the product is a species other than
pine or cedar.

Section 4. The tax hereby levied shall not apply to, nor shall
such tax be required of, those individual owners of timber who occas-
ionally sever or cut the same from their own premises to be utilized
by them in the construction or repair of their own structures, buildings
or improvements, or for their home consumption, or used by them in the
processing of their farm products.

Section 5. The tax herein imposed shall be due and payable
quarterly, except as provided in section 6 of this act, to the Department
and shall, when collected, be paid by it into the State treasury. When so
paid all such taxes shall be credited by the Comptroller, as special
revenues, to the “Protection and Development of Forest Resources of
the State Fund” of the Virginia Conservation Commission for expendi-
ture for the protection and development of the forest resources of the
State in accordance with law, and the special revenues so deposited to
the credit of said Commission shall be used for no other or different
purposes. No portion of such special revenues shall revert to the gen-
eral fund of the State at the end of any fiscal year. There is hereby
appropriated the receipts from the taxes levied by this act to the Virginia
Conservation Commission for the purpose of raising, planting and
propagating seedling trees, both hardwood and softwood, forest fire
protection, forestry education of the public in the use of forest harvesting
methods and rendering forestry service to the timber landowners of the
State. At least fifty per cent of the tax collected from any county shall
be expended in that county for carrying out the purpose for which this
tax is levied. The costs of collecting the taxes levied hereby shall be
paid out of the special fund created by this section, and there is hereby
appropriated out of such special fund, to the Department of Taxation for
such purpose, the sum of ten thousand dollars annually, or so much
thereof as may: be necessary. For the quarter beginning July first, nine-
teen hundred and forty-eight, the cost of collecting the tax hereby im-
posed shall be paid out of the general fund of the State treasury, but
the general fund shall be reimbursed therefor as soon as the collections
for that quarter have been made.

Section 6. Every manufacturer shall, within thirty days after the
expiration of each quarter, expiring, respectively, on the last day of
March, June, September and December of each year, file with the depart-
ment a return under oath, on forms prescribed by the department,
showing the kinds of forest products and the gross quantity of each
manufactured during the preceding quarter by such manufacturer, the
county or counties in which such products were severed from the soil,
and the gross quantity, if any, of such forest products severed from soil
outside this State, and such other reasonable and necessary information
pertaining thereto as the department may require for the proper en-
forcement of the provisions of this act. At the time of rendering such
quarterly returns, the manufacturer shall pay to the department the
forest products tax herein imposed, with respect to all forest products
severed from the soil in this State and embraced in such return. Provided,
however, any manufacturer of rough lumber who, during any one calen-
dar year, manufactures five hundred thousand or less feet may elect to
pay a flat tax of forty dollars when the amount cut is between five hun-
dred thousand feet and three hundred thousand feet, and a flat tax of
twenty dollars when the amount cut is three hundred thousand board
feet or less. The tax shall be payable to the department within thirty days
after the last day of December of each year and the manufacturer shall
submit to the department with said tax, forms prescribed by the depart-
ment certifying under oath that he had actually manufactured a quantity
of rough lumber in accordance with the foregoing schedule during the
preceding calendar year; and provided that any person who severs for
sale one hundred or less cords of fuel wood, or five hundred or less posts
for fish net poles during any one calendar year may elect to pay the
tax due within the thirty days after the last day of December of each
year and submit to the department with said tax, on forms prescribed by
the department, certifying under oath, as to the quantity of product
severed during the preceding calendar year, and provided, further, such
manufacturers or severers shall not be required to keep and preserve
such records as are required in section eight of this act. The elective
provisions of this section shall apply as one-half calendar year for the
pened July first to December thirty-first, nineteen hundred and forty-

Section 7. Every producer of forest products who shall ship the
same out of this State in an unmanufactured condition, or who shall
sell such products for shipment outside this State in an unmanufactured
condition shall, within thirty days after the expiration of each quarter,
expiring respectively, on the last day of March, June, September and
December of each year, file with the department a return under oath, on
forms prescribed by the department, showing the kinds of forest products
and the gross quantity thereof severed from the soil in this State and
shipped or sold for shipment to points outside this State in an un-
manufactured condition, the county or counties in which such products
were severed from the soil, and such other reasonable and necessary
information pertaining thereto as the department may require for
the proper enforcement of the provisions of this act. At the time of
rendering such quarterly returns, such producer shall pay to the depart-
ment the tax herein imposed upon the forest products embraced in said
return.

Section 8. It shall be the duty of every manufacturer in this State,
and of every producer who shall ship forest products out of this State
in an unmanufactured condition, to keep and preserve suitable records,
with the items separated into the various items on which taxes are
levied by this act, and such other books or accounts as may be necessary
to determine the amount of tax for which he is liable, under the provisions
of this act. Said books and records shall be kept and preserved for a
period of two years, and all such records shall be open for examination
at any time by the department or its duly authorized agents.

Section 9. Any person subject to the provisions of this act who
shall fail to make the returns, or any of them, as herein required, or
who shall fail to keep the records as herein required, shall be guilty of
a misdemeanor, and upon conviction shall be fined not less than ten
dollars, nor more than one hundred dollars, for each offense. Each
month of such failure shall constitute a separate offense.

Section 10. Any person subject to the provisions of this act
willfully refusing to make the returns herein required, or who shall
refuse to permit the examination of his records by the department, or
its duly authorized agents, shall be guilty of a misdemeanor, and upon
conviction shall be fined not less than twenty-five dollars, nor more than
one hundred dollars for each offense. Each month of failure to make
such returns shall constitute a separate offense, and each refusal of
a written demand of the department to examine, inspect or audit such
records shall constitute a separate offense.

Section 11. As soon as practicable after the return is filed, the
department shall examine it and ascertain the proper amount of the
tax due as shown by the return. If the amount paid is greater than the
amount due, as shown by the return, the excess shall be refunded to
the taxpayer, or credited on any deficiency previously due by the tax-
payer, under such rules and regulations as the department may adopt
and promulgate. All refunds made under this section, or under any other
section of this act, shall be paid out of the special fund created by section
five of this act. If the amount paid is less than the amount due, as shown
by the return, the department shall immediately notify the taxpayer of
such deficiency and shall add thereto a penalty of five per cent of the
amount due, and if such deficiency be not paid within thirty days from
the date of such notice, the same shall bear interest at the rate of one-
half of one percent per month, or fraction thereof, from the date the
same was due, which shall be collected as a part of the tax. But the
department may waive or remit the penalty of five per cent, or a portion
thereof, in its discretion, for good cause shown.

Section 12. Any person who fails to pay the tax herein levied
within the time required by this act shall pay, in addition to the tax a
penalty of five per cent of the amount of tax due, together with interest
thereon at the rate of one-half of one per cent per month, or fraction
thereof, after six months from the date at which the tax herein levied
became due and payable, such penalty and interest to be assessed and
collected as a part of the tax. But the department may waive or remit
the penalty of five per cent, or a portion thereof, in its discretion, for
good cause shown.

Section 13. If any taxpayer fails to make any return herein
required, the department may issue written notice, by registered mail,
to such taxpayer to make such return forthwith, and if such taxpayer
fails or refuses to make such return, within thirty days from the date
of such notice, then the department may make return for such delinquent
taxpayer upon such information as it may reasonably obtain, and shall
assess the taxes due thereon, and shall add a penalty for failure to make
such return and payment of twenty-five per cent of the tax due, as
assessed by the department, and interest at the rate of one-half of one
per cent per month, or fraction thereof, from the date such taxes were
due, But the department may waive or remit the twenty-five per cent
penalty or a portion thereof, in its discretion, for good cause shown.

Section 14. Whenever the department, in examining and auditing
the records of any taxpayer, or from other information, shall ascertain
that the amount, or amounts, previously paid by any taxpayer for any
period, or periods, is incorrect, the department shall compute the correct
amount of tax due, and if it appears that the amount paid by the taxpayer
is in excess of the correct amount due, such excess shall be refunded to
the taxpaper under the rules and regulations of the department. If it
appears that the amount paid by such taxpayer is less than the amount
due, the department shall compute the amount of such deficiency and
shall notify the taxpayer, and shall demand payment therefor, and if
not paid within thirty days from the date of such demand, the depart-
ment shall make an assessment against the taxpayer of the amount due
and shall add a penalty of one-half of one per cent per month from the
date such taxes, or any part thereof, became due; provided, however,
that if the department be of the opinion that there was a willful or frau-
dulent intent by the taxpayer to evade the tax due, it may assess a
penalty of twenty-five per cent of the tax.

Section 15. Any taxpayer aggrieved by an assessment made by the
department under this act, may apply to the department for a correction,
or he may apply to the appropriate court for a correction, and in the
first case, section four hundred and seven of the Tax Code of Virginia,
and in the second case section four hundred and ten of the Tax Code of
Virginia, shall be applicable. In either case, the limitation shall be one
year from December thirty-first of the year in which the assessment was
made.

Section 16. If the department finds that a person liable for tax
under any provision of this act designs quickly to depart from the State
or to remove his property therefrom, or to conceal himself or his property
therein, or to do any other act tending to prejudice or to render wholly
or partly ineffectual proceedings to collect such tax unless such proceed-
ing be brought without delay, the department shall cause notice of such
finding to be given such person together with a demand for an immediate
return and immediate payment of such tax. Thereupon such tax shall
become immediately due and payable. If such person is not in default of
making such return or paying any tax prescribed by this act, and
furnishes evidence satisfactory to the department under regulations to
be prescribed by the department, that he will duly return and pay the
tax to which the department’s findings relate, then such tax shall not be
payable prior to the time otherwise fixed for payment.

Section 17. The tax imposed by this act shall apply also to any
forest products severed from land owned by either this State or the
United States of America, where the forest products severed enter
commercial channels of trade for competitive markets.

Section 18. When requested by the commissioner, all transporters
of forest products out of, within or across this State shall be required
to furnish said commissioner, under oath, and upon forms prescribed
by him, any and all information relative to the transportation of such
forest products, and such reports shall contain, in addition to other
required information, the name of the shipper, date of shipment, quantity
and type of character of such forest products, stated in units or measure-
ments applicable to such forest products, the point of receipt or shipment
and the point of destination; provided, however, that in the case of com-
mon carriers using bills of lading or way bills prescribed or approved by
the Interstate Commerce Commission such common carriers shall only be
required to keep the usual records at office or offices in, this State where
such records are usually kept. The failure of any person to make the
transporter’s report provided for in this section shall be punished by
a fine of not less than fifty dollars nor more than five hundred dollars
for each offense.

Section 19. If any clause, sentence, paragraph, or part of this act,
or the application thereof to any person or circumstance, shall for any
reason be adjudged by any court of competent jurisdiction to be invalid,
such judgment shall not affect, impair or invalidate the remainder of this
act, or the application thereof to any other person or circumstance, but
shall be confined in its operation to the clause, sentence, paragraph or
any part thereof, directly involved in the controversy in which such
judgment has been rendered.

Section 20. This act shall be in force on and after July first, nine-
teen hundred and forty-eight.