How local is a local business license?

more+
less-

In a March 4, 2011 decision, the Virginia Supreme Court dealt a blow to localities attempting to collect local business license taxes from multi-state companies which engage in lending and credit transactions (in this case, Ford Motor Credit Company) in Virginia. To boil the somewhat complicated issue down, the majority held that to determine the license tax assessment for the Ford Credit “Richmond Branch” ( actually in Chesterfield County), the County must apportion the gross receipts generated by the Richmond Branch by the “payroll apportionment method” based on Ford Credits entire international payroll — regardless of their location or connection to the loans generated by the Richmond Branch!

This cost the locality over one million dollars of collections. The two dissenting Justices ( Lacy and Carrico) opined that Chesterfield was right in its assessment in that, “The company’s gross receipts, fees and interest are generated and established at the time the loan contract is executed. These executed contracts are the result of activities undertaken by the Richmond Branch”– i.e., “the definite place of business that generated taxable gross receipts.”

Please see full alert below for more information.

LOADING PDF: If there are any problems, click here to download the file.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Sands Anderson PC | Attorney Advertising

Written by:

more+
less-

Sands Anderson PC on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×
Loading...
×
×