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D.C. Municipal Regulations (Last Updated: September 13, 2017) |
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Title 9. TAXATION AND ASSESSMENTS |
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Chapter 9-7. PERSONAL PROPERTY TAX |
Section 9-710. PERSONAL PROPERTY TAX EXEMPTION FOR TELECOMMUNICATIONS COMPANIES SUBJECT TO THE TELECOMMUNICATION SERVICE TAX
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710.1For the personal property tax year beginning July 1, 1990, and ending June 30, 1991 (tax year 1991), and for each succeeding year, each telecommunication company shall be allowed a credit against personal property tax for the least of the following:
(a) The amount of personal property tax due on equipment defined in § 710.7;
(b) The amount of toll telecommunication service tax paid for the twelve (12) months immediately preceding the personal property tax year; or
(c) The amount of personal property tax reported on equipment defined in § 710.7 multiplied by the following fraction:
Step One
Column (1)
Column (2)
Column (3)
Column (4)
Current personal property tax due on property defined in § 710.7 before any Column (4) credit
X
Gross charges on toll telecommunication service tax is paid for twelve preceding months
X
Value of personal property everywhere as defined in § 710.7 on July 1st of Column (1) tax year
X
Credit against Column (1) tax not to exceed the limits of this section
Gross charges and/or gross receipts everywhere from property defined in § 710.7 for twelve months preceding Column (1) tax year: Less resales defined in § 710.9
Value of personal property on which Column (1) tax due is computed
The following are examples of the application of § 710.1 during the 1991 personal property tax year ending June 30, 1991:
(1) The taxpayer has § 710.7 property in the District valued at one hundred thousand dollars ($ 100,000), property everywhere valued at one million dollars ($ 1,000,000) on July 1, 1990. The amount of Column (1) tax due is three thousand one hundred dollars ($ 3,100). No § 4101.1 credit for tax paid to another jurisdiction is involved. The taxpayer's gross receipts everywhere from § 710.6 property for the twelve (12) month period which ended June 30, 1990, are twelve million dollars ($ 12,000,000). The gross charges on which toll telecommunication service tax was paid for this same period are one million dollars ($ 1,000,000), and the toll telecommunication service tax paid for this same period was sixty-seven thousand dollars ($ 67,000). In this instance, the amount of the credit allowed on the 1991 personal property tax return is two thousand five hundred eight-three dollars ($ 2,583), the least of the following:
(a) The Column (1) tax of three thousand one hundred dollars ($ 3,100);
(b) The toll telecommunication service tax paid; or
(c) The result of the following computation, which is two thousand five hundred eighty-three dollars ($ 2,583):
(1)
(2)
(3)
(4)
$ 3,100
X
$ 1,000,000
X
$ 1,000,000
=
$ 2,583 exemption
$ 12,000,000
$ 100,000
(2) Same facts as example (1) except that gross charges subject to the toll telecommunication service tax were one million four hundred thousand dollars ($ 1,400,000). In this instance, the allowable credit is three thousand one hundred dollars ($ 3,100), the amount of personal property tax reported in Column (1).
(1)
(2)
(3)
(4)
$ 3,100
X
$ 1,400,000
X
$ 1,000,000
=
$ 3,617 exemption
$ 12,000,000
$ 100,000
710.2For the personal property tax year beginning July 1, 1989, and ending June 30, 1990 (tax year 1990), the provisions of § 710.1 shall apply except that the Column (2) numerator shall be gross receipts on which the gross receipts tax was paid under the Gross Receipts Tax Amendment Act of 1987 for the period beginning July 1, 1988, and ending February 28, 1989, added to gross charges for the period beginning March 1, 1989, and ending June 30, 1989.
710.3For the personal property tax year beginning July 1, 1988, and ending June 30, 1989 (tax year 1989), the following procedure shall be applied, in some instances retroactively:
(a) Step One:
Section 710.1 provisions are applied except that the Column (2) numerator shall be gross receipts on which the gross receipts tax paid was under the Gross Receipts Tax Amendment Act of 1987, for the period beginning July 1, 1987, and ending February 28, 1988, added to gross charges for the period beginning March 1, 1988, and ending June 30, 1988. Any resulting credit is multiplied by one-third (1/3);
(b) Step Two:
Section 709.1 credit provisions shall be applied to the period beginning July 1, 1987, and ending June 30, 1988. Any resulting credit is multiplied by two-third (2/3); and
(c) Step Three:
The final result in Step One is added to the final result of Step Two to determine the total credit allowed against personal property tax reported on the taxpayer's 1989 return.
710.4An amended 1989 personal property tax return shall be filed if the application of this section results in additional tax due thereon.
710.5If the allocation provisions of this section do not fairly represent the extent of the personal property tax exemption, the taxpayer may petition for, or the Mayor may require, the employment of any other method to effectuate an equitable allocation of the taxpayer's personal property tax exemption.
The following is an example of the application of § 710.5:
Before March 1, 1989, a taxpayer may have paid the District gross receipts tax on none or on only some of its gross receipts; had no gross receipts; or, had gross receipts for only some of the twelve (12) months preceding the personal property tax year at issue. In such an instance, the taxpayer may petition the Mayor to modify § 710.1, 710.2 or 710.3 credit provisions, for example, by employing in the Column (2) numerator and denominator gross receipts or gross charges from the twelve (12) months concurrent with the personal property tax year rather than the preceding twelve (12) months. In this example, the taxpayer may file an amended personal property tax return after that tax year has ended to claim refund of any credit determined by operation of the modified formula described in the previous sentence.
710.6As used in § 710, the term "value of personal property" shall mean, for both the numerator and denominator of the fraction, that amount carried on the taxpayer's balance sheet at original cost for the personal property shown in the fraction.
710.7For purposes of this section, "toll telecommunication service property" shall be limited to equipment, used wholly or in part in the transmission or reception of any sound, vision, or speech communication subject to the tax imposed by the "Toll Telecommunication Service Tax Emergency Act of 1989," and shall include, but not be limited to, the following equipment used in transmissions or receptions:
(a) Switches;
(b) Transmitters;
(c) Receivers;
(d) Telephones; and
(e) Fiber optics cable and equipment.
710.8Section 710.1 gross charges as defined in the Act shown in the Column (2) numerator shall not include amounts on which a multistate tax credit is allowed.
710.9Section 710.1 gross charges as defined in the Act shown in the Column (2) denominator may be reduced by gross charges from the sale of toll telecommunication service for resale to any other telecommunication company subject to the tax under the Act.