City of Virginia Beach v. International Family Entertainment, Inc., 263 Va. 501

Summary

The Supreme Court of Virginia held that the City of Virginia Beach lacked statutory authority to impose a personal property tax on satellite transponders owned by International Family Entertainment, Inc. The transponders were permanently affixed to satellites orbiting approximately 22,300 miles above the earth and had never been physically located in Virginia Beach. The court concluded that Virginia's statutory situs rules did not authorize taxation of the transponders and rejected reliance on the common-law doctrine of mobilia sequuntur personam and Article X of the Virginia Constitution.

Holdings

1. Virginia Beach lacked statutory authority to impose a personal-property tax on International's transponders because Code § 58.1-3511(A) requires the situs of machinery and tools to be the locality where the property is physically located on the tax day, and the transponders were never physically located in Virginia Beach.
2. The common-law doctrine of mobilia sequuntur personam did not permit Virginia Beach to tax the transponders based solely on International's domicile.
3. Article X, §§ 1 and 4 of the Virginia Constitution did not independently authorize Virginia Beach to impose the tax; specific legislative authorization was required.

Questions Presented

1. Whether Virginia Beach had statutory authority under Code §§ 58.1-3507 and 58.1-3511 to impose a local personal-property tax on satellite transponders that were not physically located within the city.
2. Whether the common-law doctrine of mobilia sequuntur personam permitted Virginia Beach to tax the transponders based on the owner's domicile.
3. Whether Article X, §§ 1 and 4 of the Virginia Constitution independently authorized the City to impose the tax.

Disposition

affirmed