Utility Taxes
Due date: Monthly
Tax Rates:
New in 2007! The Virginia Communications Sales and Use Tax ("VCSUT") was enacted in the 2006 Session of the Virginia General Assembly. Effective January 1, 2007, the VCSUT will supersede many local consumer utility taxes on communications services, including telephone, cable television, E911 and some other taxes related to communication services. The VCSUT rate is 5%. It is collected by the service provider and remitted to the Virginia Department of Taxation (“TAX”). TAX then allocates the taxes collected to the appropriate localities based on the distribution formula established in the legislation. For more information concerning the VCSUT, click here.
Residential Utility Services:
- Residential local phone service – twenty-five percent (25%) of monthly charges
for the first twenty dollars ($20.00).
- Metered residential electricity service – $1.40 plus $0.015116 per kilowatt hour (kWh)
delivered monthly. Maximum amount of tax per month is $4.00.
- Residential gas service – $1.78 plus $0.10091 per 100 cubic feet (CCF)
of service delivered monthly. Maximum amount of tax per month is $4.00.
- Competitive telephone service – four percent (4%) of the first six hundred
twenty-five dollars ($625.00) of monthly charges and five percent (5%) of any amount in excess thereof.
Commercial and Industrial Utility Services
- Commercial telephone service – twenty-five percent (25%) of the first six hundred twenty-five dollars
($625.00) of monthly charges and five percent (5%) of any amount of excess thereof.
- Commercial metered electricity service – $2.75 plus $0.016462 per kilowatt hour (kWh) delivered
monthly for the first 8,945 kWh and $0.002160 for all kWhs in excess of 8,945.
- Industrial metered electricity service - $2.75 plus $.119521 per kWh delivered monthly for the
first 1,232 kWhs and $0.001837 for all kWhs in excess of 1,232.
- Commercial gas service (small volume) - $2.88 plus $0.1739027 per 100 cubic feet (CCF) delivered monthly.
- Commercial gas service (large volume) - $24.00 plus $0.07163081 per CCF delivered monthly.
- Competitive telephone service – four percent (4%) of the first six hundred twenty-five dollars
($625.00) of monthly charges and five percent (5%) of any amount in excess thereof.
Description:
Localities in Virginia are authorized by the City Charter and the Code of Virginia to impose a tax on the consumers of local public utilities. The tax on telephone services may apply only to local services. State law limits the taxes that may be imposed on residential consumers. (The rates in Richmond are grandfathered as they were in effect prior to the limitations imposed by the State). There is no statutory ceiling on the tax on commercial or industrial consumers.
How does it work:
The tax is collected by the utility provider on a monthly basis at the time that payment is due for the utility service, or according to a payment agreement established between the utility provider and the customer.
Important Note:
Due to the deregulation of electric and gas utility services, the consumer utility taxes on these services changed to a consumption based formula: kWh (kilowatt hour) for electricity and CCF (per 100 cubic feet of natural gas delivered) for natural gas service as of service January 1, 2001. To view this 2000 General Assembly legislation, click below.
To view the State and City laws governing utility taxes, see the links below:
Other Utility Taxes
- Enhanced Emergency Phone Service
- Mobile Telecommunications Service
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