GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 1999
SESSION LAW 1999-438
The General Assembly of North Carolina enacts:
Section 1. G.S. 105-164.4(c) reads as rewritten:
"(c) Certificate of
Registration. - Before a person may engage in business as a retailer or a
wholesale merchant, the person must obtain a certificate of registration from
the Department. To obtain a certificate of registration, a person must
register with the Department and pay fifteen dollars ($15.00). Department.
A certificate of registration is valid unless it is revoked for failure to comply with the provisions of this Article or becomes void. A certificate issued to a retailer becomes void if, for a period of 18 months, the retailer files no returns or files returns showing no sales."
Section 1.1. G.S. 105-164.6(f) reads as rewritten:
"(f) Before a person may
engage in business in this State selling or delivering tangible personal
property for storage, use, or consumption in this State, the person must obtain
a certificate of registration from the Department. To obtain a certificate of
registration, a person must register with the Department and pay fifteen
dollars ($15.00). Department.
A certificate of registration is valid unless it is revoked for failure to comply with the provisions of this Article or becomes void. A certificate issued to a retailer becomes void if, for a period of 18 months, the retailer files no returns or files returns showing no sales."
Section 2. G.S. 105-88 reads as rewritten:
"§ 105-88. Loan agencies or brokers. agencies.
(a) Every person, firm, or corporation engaged in any of the following businesses must pay for the privilege of engaging in that business an annual tax of two hundred fifty dollars ($250.00) for each location at which the business is conducted:
(1) The the
regular business of making loans or lending money, accepting liens on, or
contracts of assignments of, salaries or wages, or any part thereof, or other
security or evidence of debt for repayment of such loans in installment payment
or otherwise, and maintaining in connection with same any office or other
located or established place for the conduct, negotiation, or transaction of
such business and/or advertising or soliciting such business in any manner
whatsoever, shall be deemed a loan agency, and shall apply for and procure from
the Secretary of Revenue a State license for the privilege of transacting or
negotiating such business at each office or place so maintained, and shall pay
for such license a tax of seven hundred fifty dollars ($750.00). otherwise.
(2) The business of check cashing regulated under Article 22 of Chapter 53 of the General Statutes.
(3) The business of pawnbroker regulated under Chapter 91A of the General Statutes.
(b) This section does not
apply to banks, industrial banks, trust companies, savings and loan
associations, cooperative credit unions, the business of negotiating loans on
real estate as described in G.S. 105-41, pawnbrokers lending or advancing
money on specific articles of personal property, or insurance premium
finance companies licensed under Article 35 of Chapter 58 of the General
Statutes. This section applies to those persons or concerns operating
what are commonly known as loan companies or finance companies and whose
business is as hereinbefore described, and those persons, firms, or
corporations pursuing the business of lending money and taking as security for
the payment of the loan and interest an assignment of wages or an assignment of
wages with power of attorney to collect the amount due, or other order or
chattel mortgage or bill of sale upon household or kitchen furniture. No real
estate mortgage broker is required to obtain a privilege license under this
section merely because the broker advances the broker's own funds and takes a
security interest in real estate to secure the advances and when, at the time
of the advance, the broker has already made arrangements with others for the
sale or discount of the obligation at a later date and does so sell or discount
the obligation within the period specified in the arrangement or extensions
thereof; or when, at the time of the advance the broker intends to sell the
obligation to others at a later date and does, within 12 months from date of
initial advance, make arrangements with others for the sale of the obligation
and does sell the obligation within the period specified in the arrangement or
extensions thereof; or because the broker advances the broker's own funds in
temporary financing directly involved in the production of permanent-type loans
for sale to others; and no real estate mortgage broker whose mortgage lending
operations are essentially as described above is required to obtain a privilege
license under this section.
(c) At the time of making
any such loan, the person, or officer of the firm or corporation making the same,
loan, shall give to the borrower in writing in convenient form a
statement showing the amount received by the borrower, the amount to be paid
back by the borrower, and the time in which said the amount
is to be paid, and the rate of interest and discount agreed upon.
(d) Any such person,
firm, or corporation failing, refusing, or neglecting to pay the tax herein
levied shall be guilty of a Class 1 misdemeanor in addition to double the tax
due. No such loan shall be A loan is not collectible at law in
the courts of this State in any case where the person making such the
loan has failed to pay the tax levied herein, and/or otherwise complied in
this section or otherwise failed to comply with the provisions of this
section.
(e) Counties, cities, and towns may levy a license tax on the business taxed under this section not in excess of one hundred dollars ($100.00)."
Section 3. G.S. 105-159.1(d) reads as rewritten:
"(d) Return. - The Secretary
shall amend the first page of the income tax return in order that
all taxpayers desiring must give an individual the opportunity to
make the political contributions contribution authorized in this section
may do so by designating on the front face of the tax return. The line of
authorization for the designation shall be color contrasted with the color
scheme of the remainder of the income tax return. section. The
return or its accompanying explanatory instruction shall instructions
must readily indicate that any designations neither increase nor
decrease a contribution neither increases nor decreases an
individual's tax liability."
Section 4. G.S. 105-164.3(25) reads as rewritten:
"(25) 'Utility' means an electric power
company or a telephone company that is subject to a privilege tax based on
gross receipts under G.S. 105-116 or 105-120, a either of the following:
a. A
business entity that provides local, toll, or private telecommunications
service as defined by G.S. 105-120(e), or a 105-120(e).
b. A
business entity or a municipality that sells electric power, other than
a municipality whose only wholesale supplier of electric power is a federal
agency and who is required by a contract with that federal agency to make
payments in lieu of taxes. power."
Section 5. G.S. 105-164.13(12) reads as rewritten:
"(12) Sales of any of the following items:
a.
Therapeutic, prosthetic, or artificial devices, such as pulmonary respirators
or medical beds, that are designed for individual personal use to correct or
alleviate physical illness, disease, or incapacity and that are sold on the
written prescription of a physician, dentist, or other professional person
licensed to prescribe, and crutches, prescribe.
b. Crutches,
artificial limbs, artificial eyes, hearing aids, false teeth, eyeglasses
ground on prescription of a physician or an optometrist, and orthopedic optometrist.
c. Orthopedic appliances designed to be worn by the purchaser or user.
d. Durable medical equipment and related medical supplies that are covered under the Medicare or Medicaid program and are sold on either a certificate of medical necessity or a written prescription of a physician, dentist, or other professional person licensed to prescribe. This exemption applies whether or not the item is purchased by a Medicare or Medicaid beneficiary."
Section 6. G.S. 105-164.13(13) reads as rewritten:
"(13) All of the following drugs, including the constituent elements and ingredients used to produce the drugs, the packaging materials, and any instructions or information about the product included in the package with the drugs:
a. Prescription drugs.
b. Medicines
Nonprescription drugs sold on prescription of physicians, dentists,
or veterinarians; insulin whether or not sold on prescription. veterinarians.
c. Insulin."
Section 7. G.S. 105-164.13(13b) is repealed.
Section 8. G.S. 105-164.13(16) reads as rewritten:
"(16) Sales of any of the following
articles:
a. A
used article taken in trade, or a series of trades, as a credit or part payment
on the sale of a new article if tax is paid on the sales price of the new
article. "New article" means the original stock in trade of the
merchant and is not limited to a newly manufactured article.
b. An
an article repossessed by the vendor if tax was paid on the sales
price of the article."
Section 9. G.S. 105-164.13(35) reads as rewritten:
"(35) Sales by a nonprofit civic, charitable,
educational, scientific, literary literary, or fraternal
organization continuously chartered or incorporated within North Carolina
for at least two years when such all of the following conditions
are met:
a. The
sales are conducted only upon an annual basis for the purpose of raising
funds for its activities, and when the organization's
activities.
b. the
The proceeds thereof of the sale are actually used for
such purposes; provided, however, that no such sale shall be exempt if not
actually consummated the organization's activities.
c. The
products sold are delivered to the purchaser within 60 days after the first
solicitation of any sale made during said the organization's
annual sales period."
Section 10. G.S. 105-164.13(39) is repealed.
Section 11. G.S. 105-164.13(42) reads as rewritten:
"(42) Tangible personal property that is purchased by a retailer for resale or is manufactured or purchased by a wholesale merchant for resale and then withdrawn from inventory and donated by the retailer or wholesale merchant to either a governmental entity or a nonprofit organization, contributions to which are deductible as charitable contributions for federal income tax purposes."
Section 12. G.S. 105-164.13 is amended by adding a new subdivision to read:
"(46) Sales of electricity by a municipality whose only wholesale supplier of electric power is a federal agency and who is required by a contract with that federal agency to make payments in lieu of taxes."
Section 13. G.S. 105-164.13A reads as rewritten:
"§ 105-164.13A. Service charges on food, beverages, or meals.
When a service charge is imposed on food, beverages, or
meals, so much of said the service charge as that does
not exceed fifteen percent (15%) twenty percent (20%) of the
sales price is considered a tip and is specifically exempted from the
tax imposed by this Article when the service charge: if it meets both
of the following conditions:
(1) Is separately stated
in the price list, menu, or written proposal and also in the invoice or bill;
and bill.
(2) Is turned over to the personnel directly involved in the service of the food, beverages, or meals, in accordance with G.S. 95-25.6.
Such service charge shall be considered to be a tip."
Section 14. G.S. 105-164.14(c)(16) reads as rewritten:
"(16) A local airport authority that was
created pursuant to a local act of the General Assembly and has at least one
of the following characteristics:
a. It
has all of the rights of a municipality.
b. A
local act of the General Assembly declares it to be a municipality.
c. A
local act of the General Assembly specifically authorizes it to receive a
refund under this section. Assembly."
Section 15. G.S. 105-236(1) reads as rewritten:
"(1) Penalty for Bad
Checks. - When the bank upon which any uncertified check tendered to the
Department of Revenue in payment of any obligation due to the Department
returns the check because of insufficient funds or the nonexistence of an account
of the drawer, the Secretary shall assess a penalty equal to ten percent (10%)
of the check, subject to a minimum of one dollar ($1.00) and a maximum of one
thousand dollars ($1,000). This penalty does not apply if the Secretary finds
that, when the check was presented for payment, the drawer of the check had
sufficient funds in an account at a financial institution in this State to pay
the check and, by inadvertence, the drawer of the check failed to draw the
check on the account that had sufficient funds. The penalty imposed may not
be waived or diminished by the Secretary."
Section 16. G.S. 105-236(5) reads as rewritten:
"(5) Negligence. -
a. Finding of negligence. - For negligent failure to comply with any of the provisions to which this Article applies, or rules issued pursuant thereto, without intent to defraud, the Secretary shall assess a penalty equal to ten percent (10%) of the deficiency due to the negligence.
b. Large individual income tax deficiency. - In the case of individual income tax, if a taxpayer understates taxable income, by any means, by an amount equal to twenty-five percent (25%) or more of gross income, the Secretary shall assess a penalty equal to twenty-five percent (25%) of the deficiency. For purposes of this subdivision, "gross income" means gross income as defined in section 61 of the Code.
c. Other large tax deficiency. - In the case of a tax other than individual income tax, if a taxpayer understates tax liability by twenty-five percent (25%) or more, the Secretary shall assess a penalty equal to twenty-five percent (25%) of the deficiency.
d. No double penalty. - If a penalty is assessed under subdivision (6) of this section, no additional penalty for negligence shall be assessed with respect to the same deficiency.
e. Inheritance and gift tax deficiencies. - This subdivision does not apply to inheritance, estate, and gift tax deficiencies that are the result of valuation understatements."
Section 17. G.S. 105-237(a) reads as rewritten:
"(a) Waiver. - The
Secretary may, upon making a record of the reasons therefor, reduce or waive
any penalties provided for in this Subchapter, except the penalty provided
in G.S. 105-236 relating to unpaid checks. Subchapter."
Section 18. G.S. 105-259(b)(15) reads as rewritten:
"(b) Disclosure Prohibited. - An officer, an employee, or an agent of the State who has access to tax information in the course of service to or employment by the State may not disclose the information to any other person unless the disclosure is made for one of the following purposes:
...
(15) To exchange information concerning a tax imposed by Articles 2A, 2B, 2C, or 2D of this Chapter with one of the following agencies when the information is needed to fulfill a duty imposed on the Department or the agency:
a. The North Carolina Alcoholic Beverage Control Commission.
b. The Division of Alcohol Law Enforcement of the Department of Crime Control and Public Safety.
c. The Bureau of Alcohol, Tobacco, and Firearms of the United States Treasury Department.
d. Law enforcement agencies."
Section 19. G.S. 105-266(c)(1) reads as rewritten:
"(c) Statute of Limitations. - The period in which a refund must be demanded or discovered under this section is determined as follows:
(1) General Rule. - No overpayment shall be refunded, whether upon discovery or receipt of written demand, if the discovery is not made or the demand is not received within three years after the date set by the statute for the filing of the return or within six months after the payment of the tax alleged to be an overpayment, whichever is later. An agreement by a taxpayer to extend the time in which the Department can assess the taxpayer for an underpayment automatically extends the time in which the taxpayer can request a refund."
Section 20. G.S. 105-449.65(a)(8) is repealed.
Section 21. G.S. 105-449.65(a)(9) is repealed.
Section 22. G.S. 105-449.87(a)(1) reads as rewritten:
"(a) Tax. - An excise tax at the motor fuel rate is imposed on the following:
(1) Dyed diesel fuel that is used to operate a highway vehicle for a use that is not a nontaxable use under § 4082(b) of the Code. The tax does not apply, however, to dyed diesel fuel that is used to operate special mobile equipment."
Section 23. G.S. 105-449.97(b) reads as rewritten:
"(b) Administrative Discount. - A supplier that files a timely return and sends a timely payment may deduct from the amount of tax payable with the return an administrative discount of one-tenth of one percent (0.1%) of the amount of tax payable to this State as the trustee, not to exceed eight thousand dollars ($8,000) a month. The discount covers expenses incurred in collecting taxes on motor fuel."
Section 24. G.S. 105-449.106 reads as rewritten:
"§ 105-449.106. Quarterly refunds for certain
local governmental entities, nonprofit organizations, and taxicabs. taxicabs,
and special mobile equipment.
(a) Government and
Nonprofits. - A local governmental entity or a nonprofit organization listed
below that purchases and uses motor fuel may receive a quarterly refund, for
the excise tax paid during the preceding quarter, at a rate equal to the amount
of the flat cents-per-gallon rate plus the variable cents-per-gallon rate in
effect during the quarter for which the refund is claimed, less one cent (1¢)
per gallon. Any of the following entities may receive a refund under this
section:
(1) A county or
a municipal corporation.
(2) A private,
nonprofit organization that transports passengers under contract with or at the
express designation of a unit of local government.
(3) A volunteer
fire department.
(4) A volunteer
rescue squad.
(5) A sheltered
workshop recognized by the Department of Health and Human Services.
An application for a refund allowed under this section subsection
must be made in accordance with this Part and must be signed by the chief
executive officer of the entity. The chief executive officer of a nonprofit
organization is the president of the organization or another officer of the
organization designated in the charter or bylaws of the organization.
Any of the following entities may receive a refund under this subsection:
(1) A county or a municipal corporation.
(2) A private, nonprofit organization that transports passengers under contract with or at the express designation of a unit of local government.
(3) A volunteer fire department.
(4) A volunteer rescue squad.
(5) A sheltered workshop recognized by the Department of Health and Human Services.
(b) Taxi. - A person who purchases and uses motor fuel in a taxicab, as defined in G.S. 20-87(1), while the taxicab is engaged in transporting passengers for hire, or in a bus operated as part of a city transit system that is exempt from regulation by the North Carolina Utilities Commission under G.S. 62-260(a)(8), may receive a quarterly refund, for the excise tax paid during the preceding quarter, at a rate equal to the flat cents-per-gallon rate plus the variable cents-per-gallon rate in effect during the quarter for which the refund is claimed, less one cent (1¢) per gallon. An application for a refund must be made in accordance with this Part.
(c) Special Mobile Equipment. - A person who purchases and uses motor fuel to operate special mobile equipment off-highway may receive a quarterly refund, for the excise tax paid during the preceding quarter, at a rate equal to the flat cents-per-gallon rate plus the variable cents-per-gallon rate in effect during the quarter for which the refund is claimed, less the amount of sales and use tax due on the fuel under this Chapter, as determined in accordance with G.S. 105-449.107(c). An application for a refund must be made in accordance with this Part."
Section 25. G.S. 105-449.116 is repealed.
Section 26. G.S. 20-50(a) reads as rewritten:
"(a) Except as
otherwise provided in this Article, every owner of a A vehicle
intended to be operated upon any highway of this State must be registered
with the Division in accordance with G.S. 20-52, and the owner of the vehicle
must comply with G.S. 20-52 before operating the vehicle. A vehicle that
is leased to an individual who is a resident of this State is a vehicle
intended to be operated upon a highway of this State. and required by
this Article to be registered shall, before the same is so operated, apply to
the Division for and obtain the registration thereof, the registration plates
therefor and a certificate of title therefor, and attach the registration
plates to the vehicle, except when an owner is permitted to operate a vehicle
under the registration provisions relating to manufacturers, dealers and
nonresidents contained in G.S. 20-79, or under temporary registration plates as
provided in this Article: Provided that the
The Commissioner of Motor Vehicles or his the
Commissioner's duly authorized agent is empowered to grant a special
one-way trip permit to move a vehicle without license upon good cause being
shown. It is further provided that when When the owner of a
vehicle leases such the vehicle to a carrier of passengers or
property and it the vehicle is actually used by such the
carrier in the operation of its business, the registration license
plates may be obtained by the lessee, upon written consent of the owner,
after the certificate of title has been obtained by the owner. Provided
further that when When the owner of a vehicle leases such the
vehicle to a farmer and it the vehicle is actually used by such
the farmer in the operation of his a farm, the registration
license plates may be obtained by the farmer at the applicable
farmer rate, upon written consent of the owner, after the certificate of title
has been obtained by the owner. The lessee shall make application on an
appropriate form furnished by the Division and file such evidence of the lease
as the Division may require."
Section 27. G.S. 20-87(10) reads as rewritten:
"(10) Special Mobile Equipment. - The fee for
special mobile equipment for the license year or any part of the license year
is the same as two times the fee in subdivision (5) for a private
passenger motor vehicle of not more than 15 passengers."
Section 28. G.S. 20-116(a) reads as rewritten:
"(a) The total outside
width of any vehicle or the load thereon shall not exceed 96 inches, except as
otherwise provided in this section: Provided that when section.
When hogsheads of tobacco are being transported, a tolerance of six inches shall
be allowed and that when is allowed. When sheet or bale
tobacco is being transported the load does must not exceed a
width of 114 inches at the top of the load and the bottom of the load at the
truck bed does must not exceed the width of 102 inches inclusive
of allowance for load shifting or settling. Special mobile equipment
is allowed a total outside width not to exceed 102 inches. Provided,
further, that vehicles Vehicles (other than passenger buses) which
that do not exceed the overall width of 102 inches and otherwise
provided in this section may be operated in accordance with G.S. 20-115.1(c),
(f), and (g)."
Section 29. G.S. 20-140.5 reads as rewritten:
"§ 20-140.5. Special mobile equipment may tow certain vehicles.
Special mobile equipment may tow any of the following
vehicles: not tow any vehicle other than the following:
(1) A single passenger
vehicle that can carry no more than nine passengers and is not loaded, in
whole or in part, with passengers or property. passengers and is
carrying no passengers.
(2) A single
property-hauling vehicle that has a registered weight of 5,000 pounds or less
and is not loaded, in whole or in part, with passengers or property. less,
is carrying no passengers, and does not exceed its registered weight.
Special mobile equipment may not tow a vehicle that is not
listed in this section."
Section 30. G.S. 110-129.2(g) reads as rewritten:
"(g) Other Uses of
Directory Information. - The Employment Security Commission following
agencies may access information entered into the Directory from employer
reports for the purpose purposes stated:
(1) The Employment Security Commission for the purpose of administering employment security programs.
(2) The North
Carolina Industrial Commission may access information entered into the
Directory from employer reports for the purpose of administering workers'
compensation programs.
(3) The Department of Revenue for the purpose of administering the taxes it has a duty to collect under Chapter 105 of the General Statutes."
Section 31. This act does not affect the rights or liabilities of the State, a taxpayer, or another person arising under a statute amended or repealed by this act before the effective date of its amendment or repeal; nor does it affect the right to any refund or credit of a tax that accrued under the amended or repealed statute before the effective date of its amendment or repeal.
Section 32. Sections 1, 1.1, and 27 of this act become effective January 1, 2000. Sections 2 and 14 of this act become effective July 1, 1999; Section 14 applies to purchases made on or after that date. Sections 5 through 11, 13, 15 through 17, and 22 of this act become effective October 1, 1999; Sections 15 through 17 apply to penalties assessed on or after that date. The remainder of this act is effective when it becomes law; Section 24 applies to taxes paid on or after January 1, 1999.
In the General Assembly read three times and ratified this the 20th day of July, 1999.
s/ Marc Basnight
President Pro Tempore of the Senate
s/ James B. Black
Speaker of the House of Representatives
s/ James B. Hunt, Jr.
Governor
Approved 9:26 p.m. this 10th day of August, 1999