CHAPTER 423

An Act to amend and reenact §§ 58-411 and 58-412, as amended, of the
Code of Virginia, relating to the definition of capital for State tax
purposes and the exclusion of certain property from the capital classt-
fication; also relating to the local taxation of certain machinery and
tools and certain personal property, tangible in fact; and to repeal
§ 58-419 of the Code of Virginia, relating to the treatment of with-
held taxes and admission taxes in computing capital. rH 259)

Approved March 31, 1964

Be it enacted by the General Assembly of Virginia:

1. That §§ 58-411 and 58-412, as amended, of the Code of Virginia, be
amended and reenacted as follows:

§ 58-411. Definition of capital—Capital as used in this chapter is
defined as follows:

(1) The inventory of stock on hand, which shall include all materials
for use in the business, whether at the place of business, in storage or
elsewhere in the State.

(2) The foregoing clause (1) of this section, however, is subject to
the qualification that on and after January first, nineteen hundred and
sizty-siz, any agricultural product held in this State by any manufacturer
for manufacturing or processing, which agricultural product is of such
nature as customarily to require storage and processing for periods
of more than one year in order to age or condition such product for manu-
facture, shall be includible in inventory for one tax year only, and after
it has been so included and taxed for one tax year, or for more than one
tax year prior to the tax year nineteen hundred and sixty-six, the value
thereof shall be excluded in computing inventory for capital tax purposes
for the tax year nineteen hundred and sixty-six and succeeding tax years.

(* 8) The excess of all bills and accounts receivable over bills and
accounts payable.

(* 4) All other taxable personal property of any kind whatever, in-
cluding all choses in action, equities, demands and claims, but excluding
the property hereinafter specifically mentioned in § 58-412 and money on
hand and on deposit and insurance policies on the life of any person and
the cash surrender value thereof.
This section, as amended, shall be in force for the tax year nineteen
hundred and sixty-five and for every tax year thereafter, except that
clause (2) of this section shall be in force for the tax year nineteen hun-
dred and sixty-six and for every tax year thereafter.

§ 58-412. What other property not included as capital_Real estate.
—Real estate shall not be held to be capital under the preceding section,
but shall be listed and taxed as other real estate.

Machinery and tools.—Machinery and tools used in a manufacturing
or mining business taxable on capital under § 58-418 shall not be held to
be capital under the preceding section, nor shall such machinery and tools
be hereafter assessed as real estate. All such machinery and tools used in
a manufacturing or mining business taxable on capital under § 58-418
shall be listed for local taxation exclusively and each city, town and county
* shall make a separate classification for all such machinery and tools and
fix the rate of levy thereon, but such rate shall not be higher than the
rate imposed upon tangible personal property in such city, town, county
or district.

Stocks and bonds.—The shares of stock mentioned in § 58-409 and
bonds of the political subdivisions of this State mentioned in § 58-407
shall not be held to be capital under the preceding section.

Personal property, * tangible in fact, of * businesses taxable on capi-
tal, other than the manufacturing and mining businesses.—Personal prop-
erty, tangible in fact, used or employed in * all trades and businesses *
taxable on capital under this chapter, other than the manufacturing and
mining businesses, shall not be held to be capital under § 58-411, except for
inventory of stock on hand which is held for resale directly or indirectly,
but shall be listed for local taxation exclusively and taxed as tangible per-
sonal property. * Personal property, tangible in fact, used or employed in
a manufacturing or mining business taxable on capital shall be included
in capital as prescribed in § 58-411, except that machinery and tools used
in a manufacturing or mining business shall be assessed and taxed locally
as hereinabove provided. *

This section, as * amended, shall be in force for the tax year nine-
teen hundred and * sixty-five and for every tax year thereafter.

2. That § 58-419 of the Code of Virginia is repealed, effective as of
January first, nineteen hundred and sixty-five.