If my business is inside a Virginia town, can both the town and the surrounding county each charge me business personal property tax?

Plain-English summary

Senator Black asked a question that confuses business owners every year: when a business is located in a Virginia town, can the town and the county each tax the business's tangible personal property (furniture, equipment, vehicles, inventory)? The intuitive answer is "you can't double-tax," but Virginia's structural rule for towns is different from the rule for cities, and the answer turns out to be yes.

The core structural fact. Virginia cities and counties are mutually exclusive. A city, once incorporated, "is no part of the county for governmental purposes" (County of Brunswick v. Peebles & Purdy Co.). But that is "not true of a town. Its people and property are still subject to county government for county purposes." A town in Virginia is geographically inside its county and remains part of it. So property in the town is, simultaneously, property in the county.

The constitutional uniformity rule. Article X, § 1 of the Virginia Constitution says taxes "shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax." The Supreme Court of Virginia in Campbell v. Bryant (1905) read that requirement to "forbid [the] exemption from county taxes of property located in a town." A county that exempts in-town property from its tax has violated uniformity. So the county is constitutionally required to tax in-town property.

The taxing-authority statutes. Article X, § 4 of the Virginia Constitution makes tangible personal property subject to local taxation only, with the General Assembly setting "the manner and ... times" by general law. Section 58.1-3511 sets the situs of tangible personal property: "the county, district, town or city in which such property may be physically located on the tax day." Section 15.2-1104 confirms a town's general taxing authority. Read together, both the county and the town have authority over personal property in the town.

The "or" question. Senator Black asked whether the disjunctive "or" in § 58.1-3511 (the property's situs is "the county, district, town or city ...") forces a choice between the county and the town. Normally "or" is read disjunctively (Lampkins v. Commonwealth), but it can be read conjunctively "whenever it is necessary to effectuate the obvious intention of the legislature" (Industrial Development Authority v. La France). Two reasons compelled a conjunctive reading here: (1) the constitutional uniformity rule requires county taxation of in-town property, so the disjunctive reading would create a constitutional problem; (2) the legislature added "town" to the situs statute in 1972 against a background of Campbell v. Bryant and Nexsen v. Board of Supervisors, both of which had already established the dual-taxation rule. The General Assembly is presumed to know the case law it is legislating against (Waterman v. Halverson). Adding "town" was a corrective amendment to make clear that towns have personal-property tax authority, not a switch to a one-or-the-other rule.

Contrast: BPOL license tax. The opinion noted in a footnote that when the General Assembly has wanted to limit simultaneous county-and-town tax authority, it has done so explicitly. Under § 58.1-3711, a county's BPOL license tax under § 58.1-3703 does not apply within a town if the town imposes its own BPOL license tax. The legislature knows how to express that intent. The absence of comparable language in the personal-property context confirms that the dual-taxation rule applies.

Currency note

This opinion was issued in 2014. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The constitutional uniformity rule (Va. Const. art. X, § 1) and the basic structural framework (cities are independent of counties; towns are not) are unchanged. The personal-property tax statutes (§§ 58.1-3000, 58.1-3511, 15.2-1104) remain in place but should be verified for amendments. The BPOL exception in § 58.1-3711 remains a relevant comparison point. Specific rates, exemptions, and procedural rules vary by locality and by year; anyone preparing a present-day return should consult their local commissioner of revenue.

Common questions

Why do towns and counties both tax me but cities and counties don't?
Because Virginia treats cities as independent of counties (they have their own territory for governmental purposes) but treats towns as part of the surrounding county. Geographically, your business is in two jurisdictions when it is in a town: the town itself and the surrounding county. Both have taxing authority. A city, by contrast, is not in any county for governmental purposes, so only the city taxes.

Is this dual taxation "double taxation"?
Some people use that term, but courts and Virginia tax officials distinguish "double taxation" (the same taxing authority taxing the same property twice) from concurrent or overlapping taxation by different jurisdictions. The latter is allowed and is the normal Virginia pattern for towns.

Will my total tax be higher in a town than in unincorporated county land?
Often yes. You will pay both the town's rate and the county's rate. Towns typically use their additional revenue to fund town services (police, public works, parks) that supplement county services.

What can I do about it?
Pay both bills. Both are legally owed under the framework this opinion describes. Some businesses have considered relocating outside the town limits to avoid the town tax, but that is a business decision, not a legal challenge.

Can the county exempt my property because the town already taxed it?
No. The constitutional uniformity rule requires the county to apply its tax uniformly to all property in the county, including property in towns. Exempting in-town property would violate uniformity (Campbell v. Bryant).

Does this also apply to real estate?
Yes. The same constitutional uniformity logic applies to real property. Real property in a town is also subject to both county and town real estate taxes.

What about BPOL (business license tax)?
Different. Section 58.1-3711 specifically excludes the county's BPOL license tax within a town if the town imposes its own. So BPOL is one-or-the-other, but personal property is both.

Does this apply to motor vehicles registered in the town?
Yes, with the caveat that § 58.1-3511 has separate, more specific provisions for the situs of motor vehicles, trailers, boats, and airplanes. The general rule of dual county-and-town taxation still applies; the specific rules just identify which town or county controls when the vehicle is mobile.

Background and statutory framework

• Va. Const. art. X, § 1: requirement that taxes be uniform within the territorial limits of the authority levying the tax.
• Va. Const. art. X, § 2: assessments of tangible personal property at fair market value.
• Va. Const. art. X, § 4: tangible personal property is subject to local taxation only.
• Va. Code § 58.1-3000(A): all taxable tangible personal property is subject to local taxation.
• Va. Code § 58.1-3511: situs of tangible personal property for taxation; lists county, district, town, or city where the property is physically located on the tax day. Added "town" in 1972 (1972 Va. Acts ch. 185).
• Va. Code § 15.2-1104: general taxing authority of towns.
• Va. Code § 58.1-3703: county BPOL license tax authority.
• Va. Code § 58.1-3711: county BPOL license tax does not apply within a town that imposes its own BPOL tax.

The interpretive moves:

• Virginia towns are structurally inside their host counties; cities are not.
• The constitutional uniformity rule forbids exempting in-town property from county tax.
• The 1972 amendment to § 58.1-3511 added "town" against a background of settled case law on dual taxation.
• The disjunctive "or" can be read conjunctively to effectuate legislative intent and avoid constitutional conflict.
• The BPOL exclusion in § 58.1-3711 shows that the legislature knows how to write a one-or-the-other rule when it wants to.

Citations

• Va. Const. art. X, §§ 1, 2, 4
• Va. Code § 58.1-3000(A)
• Va. Code § 58.1-3511
• Va. Code § 15.2-1104
• Va. Code § 58.1-3703
• Va. Code § 58.1-3711
• County of Brunswick v. Peebles & Purdy Co., 138 Va. 348, 122 S.E. 424 (1924)
• Nexsen v. Bd. of Supvrs., 142 Va. 313, 128 S.E. 570 (1925)
• Campbell v. Bryant, 104 Va. 509, 52 S.E. 638 (1905)
• Lampkins v. Commonwealth, 44 Va. App. 709, 607 S.E.2d 722 (2005)
• Smoot v. Commonwealth, 37 Va. App. 495, 559 S.E.2d 409 (2002)
• Indus. Dev. Auth. v. La France Cleaners & Laundry Corp., 216 Va. 277, 217 S.E.2d 879 (1975)
• S. E. Pub. Serv. Corp. v. Commonwealth, 165 Va. 116, 181 S.E. 448 (1935)
• Waterman v. Halverson, 261 Va. 203, 540 S.E.2d 867 (2001)
• 1969-70 Op. Va. Att'y Gen. 276
• 1970-71 Op. Va. Att'y Gen. 386
• 2009 Op. Va. Att'y Gen. 164
• 1972 Va. Acts ch. 185

Source

• Landing page: https://www.oag.state.va.us/annual-reports-opinions/official-opinions
• Original PDF: https://www.oag.state.va.us/files/Opinions/2014/14-017_Black_3.pdf

Original opinion text

COMMONWEALTH of VIRGINIA
Office of the Attorney General
900 East Main Street
Richmond, Virginia 23219

Mark R. Herring
Attorney General

July 16, 2014

804-786-2071
FAX 804-786-1991
Virginia Relay Services
800-828-1120
7-1-1

The Honorable Richard H. Black
Member, Senate of Virginia
Post Office Box 3026
Leesburg, Virginia 20177

Dear Senator Black:

I am responding to your request for an official advisory Opinion in accordance with § 2.2-505 of the Code of Virginia.

Issue Presented

You ask whether the dual taxation of business tangible personal property by a county and a town is authorized by law.[1]

Response

It is my opinion that a county and a town concurrently may assess tangible personal property taxes on business property located within the boundaries of both governmental entities.

Applicable Law and Discussion

Article X, § 4 of the Constitution of Virginia provides that tangible personal property is subject to local taxation only, and "shall be assessed for local taxation in such manner and at such times as the General Assembly may prescribe by general law."[2] The General Assembly, in § 58.1-3511 of the Code of Virginia, has provided that "[t]he situs for the assessment and taxation of tangible personal property ... shall in all cases be the county, district, town or city in which such property may be physically located on the tax day."[3] Accordingly, counties and towns in Virginia implicitly are separately authorized to assess tangible personal property taxes in accord with the situs provisions of § 58.1-3511.

Because a town is not completely independent of its host county,[4] tangible personal property can be physically located in both a town and the surrounding county at the same time. Although a town possesses its own independent taxing authority,[5] property there remains subject to the taxing authority of the county in which it is located. It is settled in Virginia that both a county and a town may assess taxes on the same property located within both localities. As the Supreme Court of Virginia has held, "an incorporated town continues to be an integral part of the county, subject to the jurisdiction of ... county authorities and to taxation for general county purposes."[6] The Court further has found that the constitutional requirement of uniformity of taxation "forbids [the] exemption from county taxes of property located in a town."[7]

Prior opinions of this Office likewise have affirmed that "[p]roperty located in an incorporated town within a county is subject to taxation by both the county and town,"[8] and "[a] county and an incorporated town therein may each levy a tangible personal property tax on the same personal property located within the town."[9] Accordingly, based on the weight of this authority, I conclude that both a county and a town may assess tangible personal property taxes on business property located within both localities.

You question whether the use of the disjunctive "or" in § 58.1-3511 serves to preclude such concurrent taxation. Section 58.1-3511 provides that "[t]he situs for the assessment and taxation of tangible personal property ... shall in all cases be the county, district, town or city in which such property may be physically located on the tax day."[10] "Generally, phrases separated by a comma and the disjunctive 'or' are independent."[11] Nevertheless, "[w]henever it is necessary to effectuate the obvious intention of the legislature, disjunctive words may be construed as conjunctive, and vice versa."[12] As noted above, our Supreme Court has held that residents of a town remain subject to taxation for general county purposes, and that the constitutional requirement of uniformity of property taxation requires county taxes to be assessed against property located in a town. This precedent predates the addition of "town" to the situs provision of § 58.1-3511.[13] "The General Assembly is presumed to be aware of the decisions of [the Supreme Court of Virginia] when enacting legislation."[14] Accordingly, when the legislature included "town" in the list of entities authorized to impose a tax on tangible personal property, it did so knowing that the town constitutionally would not be permitted to be exempted from county taxation of the same property. Accordingly, § 58.1-3511 cannot be read in the disjunctive, but it must be read so as to allow the imposition of tangible personal property taxes by both a county and a town.[15]

Conclusion

Accordingly, it is my opinion that a county and town concurrently may assess tangible personal property taxes on business tangible personal property located within their mutual boundaries.

With kindest regards, I am

Very truly yours,

Mark R. Herring
Attorney General

[1] Because I answer this question in the affirmative, there is no need to address your second question regarding which local government otherwise would be authorized to assess the applicable tax.

[2] See also VA. CODE ANN. § 58.1-3000(A) (2013) (providing generally that all taxable tangible personal property is made subject to local taxation).

[3] I note that § 58.1-3511 also contains particularized provisions regarding the situs for the taxation of motor vehicles, travel trailers, boats, and airplanes. These specific provisions are omitted, as they are not directly relevant to your inquiry.

[4] Unlike cities, towns in Virginia do not exist independently of the counties in which they are located. See Cnty. of Brunswick v. Peebles & Purdy Co., 138 Va. 348, 358, 122 S.E. 424, 427 (1924) ("A city is entitled, under the provisions of article VI of the Constitution, to a separate government, and when incorporated is no part of the county for governmental purposes. But this is not true of a town. Its people and property are still subject to county government for county purposes.").

[5] See VA. CODE ANN. § 15.2-1104 (2012) (providing a town general authority to assess taxes on "property, persons, and other subjects of taxation, which are not prohibited by law").

[6] Nexsen v. Bd. of Supvrs., 142 Va. 313, 318, 128 S.E. 570, 571 (1925).

[7] See 1970-71 Op. Va. Att'y Gen. 386, 386 (paraphrasing a key holding of Campbell v. Bryant, 104 Va. 509, 515-16, 52 S.E. 638, 640 (1905)). With respect to the constitutional requirement of uniformity of taxation, Article X, § 1 of the Virginia Constitution provides generally that all taxes "shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax."

[8] 2009 Op. Va. Att'y Gen. 164, 166; see 1970-71 Op. Va. Att'y Gen. at 386; 1969-70 Op. Va. Att'y Gen. 276, 276. Although two of these opinions were issued prior to the 1972 amendment adding "town" to § 58.1-3511, the 1972 amendment is not inconsistent with the underlying logic of the opinions. It merely corrected a legislative omission by which the earlier version of the statute could have been interpreted to mean that towns have no taxing authority over personal property.

[9] 1969-70 Op. Va. Att'y Gen. at 276; see also 1970-71 Op. Va. Att'y Gen. at 386 (concluding that residents of the Town of Middletown are subject to personal property taxes assessed by the Town as well as by Frederick County).

[10] Emphasis added.

[11] Lampkins v. Commonwealth, 44 Va. App. 709, 717, 607 S.E.2d 722, 726 (2005) (citing Smoot v. Commonwealth, 37 Va. App. 495, 501, 559 S.E.2d 409, 412 (2002)).

[12] Indus. Dev. Auth. v. La France Cleaners & Laundry Corp., 216 Va. 277, 280, 217 S.E.2d 879, 882 (1975) (alteration in original) (quoting S. E. Pub. Serv. Corp. v. Commonwealth, 165 Va. 116, 122, 181 S.E. 448, 450 (1935)).

[13] See 1972 Va. Acts ch. 185 (inserting the word "town" into the list of taxing entities of the disjunctive phrase found in the predecessor statute to § 58.1-3511). The applicable cases were decided in 1905 and 1924, see supra notes 6 and 7.

[14] Waterman v. Halverson, 261 Va. 203, 207, 540 S.E.2d 867, 869 (2001).

[15] In addition, as a comparison, I note that when the General Assembly has intended to limit the authority of counties and towns simultaneously to assess taxes not subject to the uniformity requirement, it expressly has done so. For example, any county license tax assessed pursuant to § 58.1-3703 does not apply within the limits of a town located within such county if the town imposes a license tax on the same privilege. See § 58.1-3711 (2013).