CHAPTER 587

An Act to amend the Code of Virginia by adding in Title 58 thereof
a chapter numbered 12.1, containing sections numbered 58-685.10
through 58-685.26, so as to impose a tax upon the sale and use of
motor vehicles; to ‘prescribe the manner of computation and collection
of such tax; to provide for certain exemptions therefrom; to au
the Commissioner of the Division of Motor Vehicles to adopt rules
and regulations relating to application and collection thereof; and to
provide for disposition of revenues derived therefrom. CH 296)

Approved April 5, 1966

Be it enacted by the General Assembly of Virginia:
1. That the Code of Virginia be amended by adding in Title 58 thereof
a chapter numbered 12.1, containing sections numbered 58-685.10 SEEORED
58-685.26, as follows:
8 58-685.10. This chapter shall be known and may be cited as the
“Virginia Motor Vehicle Sales and Use Tax Act.”

§ 58-685.11. The following words, terms and phrases when used in
this chapter shall have the meanings ascribed to them in this section,
except where the context clearly indicates a different meaning: _

(1) “Commissioner” shall mean the Commissioner of the Division of
Motor Vehicles of this State. ;

(2) “Division” shall mean the Division of Motor Vehicles of this
State, acting through its duly authorized officers and agents.

(3) “Motor vehicle” shall mean every vehicle which is self-propelled
or designed for self-propulsion and every vehicle drawn by or designed to
be drawn by a motor vehicle, including every device in, upon or by which,
any person or property is, or can be, transported or drawn upon a highway,
but excepting devices moved by human or animal power, devices u
exclusively upon stationary rails or tracks and vehicles used in this State
but not required to be licensed by the State, and vehicles which can be
moved or drawn on the highways only under special permit and which are
permanently attached to the real estate as housing. ;

(4) “Person” shall mean every natural person, firm, partnership,
association or corporation.

(5) “Sale” shall mean any transfer of ownership or possession, or
both, exchange, barter, lease or rental, conditional or otherwise, in any
manner or by any means whatsoever, of a motor vehicle, including a trans-
action whereby possession is transferred but title is retained by the seller
as security, but excluding any transfer of ownership or possession, which
transfer is made to secure payment of an obligation, or which is incidental
to repossession under a lien and under which ownership is transferred to
the repossessor, his nominee or a trustee, pending ultimate disposition or
sale of the collateral.

(6) “Sale price” shall mean the total price paid for a motor vehicle
and all attachments thereon and accessories thereto, without any allow-
ance or deduction for trade-ins or unpaid liens or encumbrances, but exclu-
sive of any federal manufacturer’s excise tax.

§ 58-685.12. There is hereby levied and imposed, in addition to all
other taxes and fees of every kind now imposed by law, a tax upon the
sale of every motor vehicle sold in this State and upon the use in this
State of any motor vehicle, the same to be collected in the amount to be
determined by the application of the following rate against the gross sales
price:

(a) Two per cent (2%) of the sale price of each motor vehicle sold
in this State.

(b) Two per cent (2%) of the sale price of each motor vehicle when
reload is not sold in this State but is used or stored for use in this

Notwithstanding the above provisions, the tax levied by this section
shall not be applicable to any nineteen hundred sixty-six motor vehicle
which is sold as a new vehicle before January one, nineteen hundred
sixty-seven.

A transaction taxed under subsection (a) shall not also be taxed
under subsection (b), nor shall the same transaction be taxed more than
once under either section.

(c) The tax imposed by this chapter on motor vehicles having seats
for more than seven passengers used by common carriers of passengers
within and without the State, shall be apportioned on the ratio which the
mileage traveled in Virginia by all such motor vehicles owned or operated
by such common carrier bears to the total number of miles operated by
such vehicles within and without Virginia by such common carrier in the
immediate preceding license year. The Commissioner may require such
evidence of the total number of vehicles owned or operated by such com-
mon carrier and the miles traveled by all such motor vehicles as he deems
appropriate for the application and administration of this chapter and
other provisions of law.

§ 58-685.13. Any motor vehicle sold to or used by the United States
or any of the governmental agencies thereof or the State of Virginia or
any political subdivision thereof shall be exempt from the tax imposed by
this chapter. |

Motor vehicles having seats for more than seven passengers sold or
leased to urban and suburban bus lines, which are defined as bus lines the
majority of whose passengers use the buses for traveling a distance of
not exceeding forty miles, measured one way, on the same day between
their place of abode and their place of work, shopping areas, or schools,
shall be exempt from the tax imposed by this chapter.

§ 58-685.14. The tax shall be paid by the purchaser or user of such
motor vehicle and collected by the Commissioner at the time the owner
applies to the Division of Motor Vehicles for, and obtains, a certificate of
title therefor. No tax shall be levied or collected under this chapter upon
the sale or use of a motor vehicle for which no certificate of title is
required.

_ § 58-685.15. In the case of the sale or use of a motor vehicle upon
which the pricing information is required by federal law to be posted, the
Commissioner may collect the tax upon the basis of the total sale price
shown on such document; provided that if the Commissioner is satisfied
that the purchaser has paid less than such price by such evidence as the
Commissioner may require, he may assess and collect the tax upon the
basis of the sale price so found by him. In no case shall such lesser price
include credits for trade-in or any other transaction of such nature. In
the case of the sale or use of a motor vehicle which is not a new motor
vehicle, the Commissioner may employ such publications, sources of infor-
mation, and other data as are customarily employed in ascertaining the
maximum sale price of such used motor vehicles but in no case shall any
credit be allowed for trade-in or any other transaction of like nature.

§ 58-685.16. The Commissioner shall have the power to make and
publish reasonable rules and regulations not inconsistent with this chap-
ter, or the other applicable laws, or the Constitution of this State, or of
the United States, for the enforcement of the provisions of this chapter
and the collection of the revenues hereunder. Such rules and regulations
shall not be subject to Chapter 1.1 of Title 9 of the Code of Virginia.

§ 58-685.17. In the event any person submits with his application
for a Certificate of Title a sum insufficient in the judgment of the Com-
missioner to pay the sale or use tax prescribed by this chapter, it shall
be the duty of the Commissioner or his authorized agent to make an
estimate of the tax due the Commonwealth and to assess the tax due on
the motor vehicle. The notice of such assessment shall be forthwith sent
to such person by certified mail at the address of the person as it appears
on the records of the Division. Such notice, when sent in accordance with
these requirements, shall be sufficient regardless of whether or not it was
ever received. If any person fails to pay such tax, the Commissioner shall
bring an appropriate action for the recovery of such tax plus interest and
judgment shall be rendered for the amount found to be due together with
cost. All remedies now or which may hereafter be given by the laws of
this State for the collection or enforcement of taxes are hereby expressly
given for the collection and enforcement of judgments recovered under
this section. .

§ 58-685.18. The Commissioner or any agent authorized by him may
examine during the usual business hours of the day records, books, papers
or other documents of any dealer in motor vehicles relating to the sales
price of any motor vehicle to verify the truth and accuracy of any state-
ment or any other information as to a particular sale.

§ 58-685.19. In the event it shall appear to the satisfaction of the
Commissioner that any tax imposed by this chapter has been erroneously
or illegally collected from any person, the Commissioner shall certify the
amount thereof to the Comptroller who shall thereupon draw his warrant
for such certified amount on the State Treasurer. Such refund shall be
paid by the State Treasurer.

No refund shall be made under the provisions of this section unless

a written statement is filed with the Commissioner setting forth the reason
such refund is claimed. The claim shall be in such form as the Commis-
sioner shall prescribe and shall be sworn to by the claimant. It shall be
yn with the Commissioner within one year from the date of the payment
of the tax.
§ 58-685.20. A credit shall be granted against the tax imposed by
this chapter with respect to a person’s use in this State of a motor vehicle
purchased by him in another state. The amount of the credit shall be equal
to the tax paid by him to another state by reason of the imposition of a
similar tax on his purchase or use of the property. The amount of the
credit shall not exceed the tax imposed by this chapter.

§ 58-685.21. The Commissioner may, in his discretion upon request
duly received from the officials to whom is entrusted the enforcement of
motor vehicle tax laws of any other state, forward to such officials any
information which he may have in his possession relative to the registration
and payment of any tax collected pursuant to this chapter.

§ 58-685.22. Any person against whom an order or decision of the
Commissioner has been adversely rendered relating to the tax imposed
by this chapter may appeal from such order or decision to the Circuit
Court of the City of Richmond if such appeal is filed within fifteen days.

§ 58-685.28. All funds collected hereunder by the Commissioner shall
be forthwith paid into the State treasury and the revenue so derived, after
deducting refunds, is hereby appropriated for the construction, reconstruc-
tion and maintenance of highways and the regulation of traffic thereon and
for no other purpose.

§ 58-685.24. In every transaction subject to the provisions of this
chapter, the tax imposed by this chapter shall be separately stated from
the sale price of such motor vehicle and shall be paid by such purchaser in
accordance with the provisions of this chapter.

§ 58-685.25. The tax imposed by this chapter shall become effective
on September 1, 1966, and all sales consummated on and after such date
shall be subject to the tax imposed by this chapter. No city, town or county
shall impose or continue to impose any local sales or use tax on motor
vehicles after the tax imposed by this chapter becomes effective.

_§ 58-685.26. If any provision of this chapter be held unconstitutional
or invalid by a court of competent jurisdiction the same shall not affect
the remaining provisions of this chapter but all such provisions not held
unconstitutional or invalid shall remain in full force and effect.