Virginia ~ Corporate Income Tax: Single Sales Factor Apportionment Enacted for Retail Companies

Virginia Gov. Bob McDonnell has signed legislation requiring retail companies to use a single sales factor apportionment formula in computing their state corporate income tax liability. The modification is effective beginning July 1, 2012, and will be phased in as follows:

— for taxable years beginning on or after July 1, 2012, but before July 1, 2014, retail companies are required to use a triple-weighted sales factor;

— for taxable years beginning on or after July 1, 2014, but before July 1, 2015, retail companies are required to use a quadruple-weighted sales factor; and

— for taxable years beginning on or after July 1, 2015, and thereafter, retail companies are required to use the single sales factor method to apportion Virginia taxable income.

As previously reported (TAXDAY, 2012/02/21, S.5), a retail company is defined as a “domestic or foreign corporation primarily engaged in activities that, in accordance with the North American Industry Classification System (NAICS), United States Manual, United States Office of Management and Budget, 1997 Edition, would be included in Sectors 44-45.”

Ch. 86 (H.B. 154), Laws 2012, effective as noted

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Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

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