TITLE 30

State Taxes

Occupational and Business Licenses and Taxes

CHAPTER 21. GENERAL PROVISIONS CONCERNING LICENSES


No person shall engage in or carry on any trade or business for which a license is required by this part without first having obtained a license therefor from the Department of Finance and paid therefor the fee or tax prescribed in this Part. The provisions of § 516(g) and § 2216 of Title 13 shall apply and supersede any license requirements of this part with respect to matters involving any applicant or licensee under § 516(g) or § 2216 of Title 13. The Department shall forthwith deny the issuance or renewal of any license under this Part, or suspend the same, upon receipt of notification from the Family Court pursuant to § 516(g) of Title 13 or notice from the Director of the Division of Child Support Enforcement pursuant to § 2216 of Title 13 regarding an applicant or licensee. The Social Security number of the applicant shall be included on the application for issuance or renewal of any license under this Part.

27 Del. Laws, c. 139; Code 1915, § 180; 40 Del. Laws, c. 27, § 1; Code 1935, § 192; 41 Del. Laws, c. 14, § 2; 30 Del. C. 1953, § 2101; 57 Del. Laws, c. 741, § 10A; 70 Del. Laws, c. 452, § 12; 71 Del. Laws, c. 216, §§ 56, 90.;

(a) In general. — All licenses issued under this title shall be for a term of 1 year, expiring on December 31, or on the date prescribed pursuant to the provision of the Delaware Code under which it was issued. Lost or stolen license certificates may be replaced for their unexpired terms upon payment of a $15 fee to the Department of Finance.

(b) Optional 3-year renewal. — Persons licensed under this section may, but are not required to, renew their licenses for a term of 3 years upon payment of a license fee equal to 3 times the fee in effect for said license at the time of renewal. Holders of 3-year licenses which add locations or units separately licensable under this section shall pro-rate the license fee for additional units or locations to the expiration date of their current licenses.

(c) Alignment of renewal periods. — Persons electing an optional 3-year renewal must elect such option for all units and locations of each licensable activity.

Code 1852, § 1226; 25 Del. Laws, c. 14, § 3; 27 Del. Laws, c. 30; Code 1915, §§ 187, 212; 28 Del. Laws, c. 13; 40 Del. Laws, c. 27, § 1; Code 1935, §§ 198, 240; 41 Del. Laws, c. 14, §§ 8, 9; 30 Del. C. 1953, § 2102; 57 Del. Laws, c. 136, § 4; 60 Del. Laws, c. 24, § 20; 71 Del. Laws, c. 314, § 2; 74 Del. Laws, c. 108, § 1.;

(a) The Department of Finance shall keep a record of all licenses. All provisions of law relative to the duties and powers of the Auditor of Accounts in auditing and adjusting accounts shall apply with equal force and effect to the Department of Finance relative to the licenses mentioned in this title.

(b) A failure to deposit to the credit of the General Fund of the State all money received for fees or taxes as required by law shall render the Secretary of Finance liable for money due the State, and, in addition, the Secretary shall be fined not more than $1,000, or imprisoned not more than 1 year, or both.

(c) Whenever any section of Part III of this title is amended to affect taxes or licenses or rules or regulations are promulgated by the Division of Revenue which affect taxes or licenses, it shall be the duty of the Division of Revenue to give public notice of such changes. Such notification, where appropriate, shall be made when new forms are mailed to businesses and merchants.

(d) Notwithstanding the requirements set forth in subsection (c) of this section, a claimed lack of notification of any changes in Part III of this title or in rules or regulations affecting taxes or licenses by a business or merchant shall not give rise to a cause of action against the Division of Revenue, nor shall it eliminate or reduce any fines or penalties incurred because of the failure of the business or merchant to comply with a new statute, rule or regulation.

Code 1915, § 226A; 40 Del. Laws, c. 30, § 1; Code 1935, § 206; 42 Del. Laws, c. 77, §§ 1, 2; 30 Del. C. 1953, § 2103; 50 Del. Laws, c. 442, § 1; 57 Del. Laws, c. 136, § 5; 57 Del. Laws, c. 188, §§ 1, 34; 57 Del. Laws, c. 741, §§ 10A-10C; 60 Del. Laws, c. 562, § 1; 64 Del. Laws, c. 120, § 1; 66 Del. Laws, c. 103, § 1; 66 Del. Laws, c. 120, § 6; 68 Del. Laws, c. 187, § 15; 70 Del. Laws, c. 186, § 1.;

The Department of Finance shall cause public notice of the time when the licenses required in this part shall be procured. The public notice required shall be in such form and to such extent as the Secretary of Finance deems necessary.

14 Del. Laws, c. 418, §§ 8, 10; 25 Del. Laws, c. 14, § 4; Code 1915, §§ 159, 161, 188, 226A; 40 Del. Laws, c. 25, § 1; 40 Del. Laws, c. 26, § 1; 40 Del. Laws, c. 27, § 1; 40 Del. Laws, c. 30, § 1; Code 1935, §§ 171, 173, 201; 57 Del. Laws, c. 741, § 10A; 58 Del. Laws, c. 205.;

An individual, 65 years of age or older or licensed as a direct care worker under § 2301(a) of this title, and whose gross receipts for the 12 months, beginning July 1 and ending June 30, preceding the year of application or renewal are less than $10,000 shall pay one fourth of the annual occupational or business license fee specified in §§ 2301(a), 2301(b), 2502(a), 2702(a), 2902(b), 2903(b), 2904(b), 2905(a), 2906(b), 2907(b), 2908(b) and 4305(a) of this title.

75 Del. Laws, c. 171, § 1; 78 Del. Laws, c. 104, § 1.;

Each license granted under this part shall be for the sole use and benefit of the licensee to whom it is issued and shall not be transferable. In case of the death of any licensee, the licensee's personal representative shall succeed to all rights thereunder until the date of expiration of the license issued.

14 Del. Laws, c. 418, §§ 8, 10; 20 Del. Laws, c. 71, § 2; 25 Del. Laws, c. 14, § 4; Code 1915, §§ 159, 161, 188, 200, 226A; 40 Del. Laws, c. 25, § 1; 40 Del. Laws, c. 26, § 1; 40 Del. Laws, c. 27, § 1; 40 Del. Laws, c. 30, § 1; Code 1935, §§ 171, 173, 176, 201; 30 Del. C. 1953, § 2106; 70 Del. Laws, c. 186, § 1.;

A license granted for an occupation and which specifies the place of business thereby licensed shall not authorize the licensee to carry on any trade, business, pursuit or occupation specified in such license in any other place than the place of business set forth in such license. If a licensee changes the location of the licensee's place of business during the period for which the license is issued, the license may be transferred to such new location.

25 Del. Laws, c. 14, § 3; Code 1915, § 187; 40 Del. Laws, c. 27, § 1; Code 1935, § 198; 41 Del. Laws, c. 14, §§ 8, 9; 30 Del. C. 1953, § 2107; 70 Del. Laws, c. 186, § 1.;

No refund of license fees shall be payable for any unexpired term of a license.

74 Del. Laws, c. 108, § 2.;

(a) Every person holding any state license authorizing the conduct of any business, trade or vocation shall expose such license in a conspicuous manner in the principal office or place of business of such person.

(b) Every individual, every member of a firm or association of persons and every director and officer of a corporation holding a license under this part and failing to comply with this section shall be fined not more than $100.

(c) None of the provisions of this section shall be deemed or taken to repeal the penalties imposed by any statute of the State for the failure of any particular class of licensees.

25 Del. Laws, c. 145, §§ 1-3; Code 1915, § 270; Code 1935, § 242; 30 Del. C. 1953, § 2109.;

No person shall agree or contract directly or indirectly to pay or assume or bear the burden of any license tax payable by any person, firm or corporation under the provisions of this Part. Any such agreement shall be null and void and shall not be enforced or given effect by any court. This section shall not apply to the surcharge described in § 2902(c)(4) of this title.

Code 1935, § 198A; 43 Del. Laws, c. 10; 30 Del. C. 1953, § 2110; 67 Del. Laws, c. 326, § 4; 78 Del. Laws, c. 94, §§ 1, 2.;

The Secretary of Finance, or the Secretary's delegate, each year, shall prepare blank licenses for each business, trade, pursuit or corporation mentioned and enumerated in this part in such form as the Secretary of Finance deems proper. The licenses shall be signed by the signature or by the facsimile signature of the Secretary of Finance and shall each bear the date of issue.

14 Del. Laws, c. 418, § 8; Code 1915, §§ 159, 226A; 40 Del. Laws, c. 25; 40 Del. Laws, c. 30, § 1; Code 1935, §§ 171, 206; 30 Del. C. 1953, § 2111; 57 Del. Laws, c. 741, §§ 10A, 10B; 60 Del. Laws, c. 562, § 4; 70 Del. Laws, c. 186, § 1.;

Every license issued under this part shall state:

(1) The name and address of the licensee;

(2) The trade, business or occupation for which the license is granted;

(3) The amount of the license fee paid to the State; and

(4) The date of issuance of the license.

25 Del. Laws, c. 14, § 3; Code 1915, § 187; 40 Del. Laws, c. 27, § 1; Code 1935, § 198; 41 Del. Laws, c. 14, §§ 8, 9; 30 Del. C. 1953, § 2112.;

(a) Every person, other than a circus exhibitor, who shall procure an occupation license may, during the term for which such license is granted, carry on such occupation in any county of this State, subject, however, to the provisions and restrictions contained in this part.

(b) Every circus exhibitor who shall procure a license to conduct a circus shall be authorized and empowered during the term for which such license was granted to exercise and carry on such occupation in every county of this State, subject, however, to the provisions and restrictions contained in said license.

25 Del. Laws, c. 14, § 3; Code 1915, § 187; 40 Del. Laws, c. 27, § 1; Code 1935, § 198; 41 Del. Laws, c. 14, §§ 8, 9; 30 Del. C. 1953, § 2113.;

Repealed by 65 Del. Laws, c. 184, § 4, effective July 1, 1985.;

Any person conducting or exhibiting any place of amusement which is required to be licensed, where all of the profits derived from such place of amusement are devoted to charitable, religious or philanthropic purposes, shall not be required to take out any license.

26 Del. Laws, c. 16, § 25; Code 1915, § 226; Code 1935, § 202; 30 Del. C. 1953, § 2115.;

No honorably discharged soldier or sailor shall be required to procure any license to follow the occupation of canvassing for the sale of books or for the occupation commonly known as that of "book agent" or for the occupation of auctioneer. The certificate of honorable discharge of any such soldier or sailor shall be conclusive evidence of the right of such soldier or sailor to follow the occupations hereinbefore mentioned without having procured a license therefor.

22 Del. Laws, c. 389, §§ 1, 2; 26 Del. Laws, c. 180, § 8; Code 1915, §§ 213, 215; 32 Del. Laws, c. 7; Code 1935, §§ 188, 190; 42 Del. Laws, c. 66; 47 Del. Laws, c. 75; 30 Del. C. 1953, § 2116.;

In case of the violation of this chapter by any person, association of persons, firm or corporation, any person or persons acting as agent or agents of such person, association of persons, firm or corporation may be proceeded against as principals and, if found guilty, shall be punished in accordance with the provisions thereof.

26 Del. Laws, c. 179, § 2; Code 1915, § 202; Code 1935, § 178; 30 Del. C. 1953, § 2117.;

(a) Every justice of the peace and constable, within such officer's respective county, whenever such officer has knowledge that any individual, copartnership, firm or corporation or any other association of persons acting as a unit is or are engaged in prosecuting, following or carrying on or practicing or conducting any business, trade, pursuit or occupation mentioned and enumerated in this part without having first obtained a license therefor as required in this part, shall make complaint or cause complaint to be made thereof to the Department of Finance, which shall thereupon proceed according to the provisions of this chapter relative thereto, and the jurisdiction of justices of the peace and constables relative to misdemeanors and offenses shall extend and apply to misdemeanors and offenses created by this part. Every individual, copartnership, firm or corporation or any other association of persons acting as a unit engaged in prosecuting, following or carrying on or practicing or conducting any business, trade, pursuit or occupation mentioned and enumerated in this part, shall, on demand of any officer of the Department of Finance or of any justice of the peace or constable or on demand of any citizen of this State, produce the license therefor; and unless he, she or they shall so do, it shall be presumptive evidence that he, she or they, as the case may be, has or have no license.

(b) Whoever, being a justice of the peace, sheriff, deputy sheriff or constable, neglects or refuses to perform the duty required of such officer, as in this section provided, shall be fined in such amount as the court may determine.

(c) Whoever, being a public officer and having made an arrest under this section, accepts or receives any money or reward of any kind, as a condition of releasing the person arrested without prosecution, shall be fined not more than $100, or imprisoned not more than 20 days, or both.

(d) Justices of the peace shall have jurisdiction of offenses under this part.

Code 1915, § 226A; 40 Del. Laws, c. 30, § 1; Code 1935, §§ 206, 206B; 41 Del. Laws, c. 18, § 2; 30 Del. C. 1953, § 2118; 57 Del. Laws, c. 741, §§ 10A, 10D; 70 Del. Laws, c. 186, § 1; 78 Del. Laws, c. 266, § 22.;

If any individual, copartnership, firm or corporation or any association of persons acting as a unit shall engage in, prosecute, follow or carry on any occupation or business for which a license is required by this Part, within the limits of this State, without having first obtained a proper license therefor, that person or persons and the individuals composing such firm or association of persons and each of them and the president and directors of such corporation and each of them, and those persons defined in § 282 of Title 11, for every such offense shall be liable to the payment of the license fees and shall be fined not more than $3,000, or imprisoned not more than 2 years, or both.

15 Del. Laws, c. 381, § 4; 17 Del. Laws, c. 83, § 2; 18 Del. Laws, c. 555, § 4; 20 Del. Laws, c. 118, § 1; 20 Del. Laws, c. 457, §§ 1, 2; Code 1915, §§ 182, 183; 40 Del. Laws, c. 27, § 1; 40 Del. Laws, c. 29, §§ 1, 2; 40 Del. Laws, c. 30, § 1; Code 1935, §§ 194, 197; 41 Del. Laws, c. 14, §§ 4, 7; 30 Del. C. 1953, § 2119; 57 Del. Laws, c. 136, § 9; 67 Del. Laws, c. 40, §§ 4, 5; 70 Del. Laws, c. 186, § 1.;

(a) Wherever this part uses the term "gross receipts," no deduction shall be made therefrom on account of the cost of property sold, the cost of materials used, labor costs, interest, discount paid, delivery costs, federal or state taxes or any other expense whatsoever paid or accrued or losses, unless otherwise expressly provided in this part.

(b) "Gross receipts" (and, in the case of Chapter 43 of this title, "rent" and "lease rental payments") shall not include amounts received from a related entity. Entities are related whenever: (1) more than 80 percent in value of the stock, partnership interests, beneficial trust interests or other ownership interests of each entity is owned directly, indirectly or beneficially by the same 5 or fewer individuals; or (2) 100 percent of each entity is owned by a member or members of 1 family. "Family" for purposes of this section shall mean those individuals standing in a close family relationship to each other. For purposes of this subsection, a "close family relationship" shall mean the following relationships: A husband or wife; a parent, grandparent, child by birth, spouse or surviving spouse of a child by birth, a child by legal adoption, the lineal descendant of the decedent, a stepchild of the decedent or the lineal descendant of a stepchild; or any person whose relationship is within 5 degrees of consanguinity, whether by the whole or half blood, and whether a blood relative of the decedent or a relative by virtue of legal adoption. For purposes of determining ownership interest of 5 or fewer individuals (and not members of a family), ownership of stock, partnership interests, trust beneficial interests or other ownership interests shall be determined in accordance with the attribution rules set out in § 544(a) of the Internal Revenue Code of 1986 (26 U.S.C. § 544) or successor section.

30 Del. C. 1953, § 2120; 57 Del. Laws, c. 136, § 10; 60 Del. Laws, c. 24, § 18; 70 Del. Laws, c. 186, § 1; 70 Del. Laws, c. 489, §§ 1, 2; 72 Del. Laws, c. 104, § 7.;

In the case of any person making an initial application for a business or occupational license pursuant to Chapter 23, 25, 27, 29 or 43 of this title, the basic annual license fee for such initial year specified therein shall be reduced pro rata by the portion attributable to the number of full calendar months of the license year that have expired prior to the issuance of the license or, otherwise than in the event of any person making an initial application for a license, in the case of license fees under Chapter 23 of this title computed according to numbers of business units prior to such business units being placed in service.

60 Del. Laws, c. 562, § 5; 67 Del. Laws, c. 40, §§ 18, 19.;

For purposes of this part, the term "lookback period" shall refer to the 12-month period between July l and June 30 immediately preceding the taxable year for which the filing frequency is determined by reference to the lookback period. Persons who were, during the entirety of the lookback period, not required to be licensed under a specific chapter of Part III of this title, shall be deemed to have had no taxable gross receipts during the lookback period with regard to that chapter.

69 Del. Laws, c. 289, § 12.;

The Director may, by regulation, to include by means of instructions accompanying returns, waive quarterly filing of returns relative to taxes on gross receipts in the case of taxpayers who have had no taxable gross receipts within the quarter. In no event shall taxpayers required to report gross receipts be permitted to file any less frequently than annually.

69 Del. Laws, c. 289, § 14.;

(a) Revocation, denial or nonrenewal of licenses. — Whenever there has remained unpaid by a person for a period in excess of 180 days any final assessment of tax and/or penalty or interest due under this title (other than Chapters 51 and 52 and Chapter 30 of this title with the exception of §§ 3004 and 3005 of said chapter) exceeding $2,500, the Director may issue a notice of intent to revoke any license issued to such person (provided such license shall be the license for the business or occupation from which the liability arose and also provided that, in case of delinquent withholding or corporate income taxes, any license issued to such person) or, in the case of an application for a new license or renewal of an existing license, a notice of intent, respectively, to deny or withhold the license.

(b) Other persons affected. — The Director may revoke, deny or withhold a license under the preceding subsection when he finds that:

(1) The license is sought by or was issued to a person who is related, as defined in § 2125 of this title, to a revokee;

(2) The chapter of this title under which the previous license was revoked, denied or withheld is the same as the chapter under which the subsequent license is sought or was issued; and

(3) The business being or to be conducted is substantially the same as the revokee's business.

(c) Notice. — Notice of proceedings pursuant to subsection (a) or (b) of this section shall set forth the reasons for its issuance (including the amount of such unpaid liability) and shall be sent by certified mail to the last known address of the licensee or applicant.

(d) Finality of revocation, denial or nonrenewal; right to protest. — Thirty days after the issuance of the notice of intent, the revocation, denial or nonrenewal shall become final, unless within that time the taxpayer has filed a written protest with the Director under § 523 of this title.

(1) The sole grounds for protest under subsection (a) of this section shall be:

a. The absence of any unpaid liability as of the date of the protest;

b. The absence of an unpaid liability exceeding $2,500 as of the date of the notice under subsection (a) of this section; or

c. That the assessment creating the liability was contrary to law and the taxpayer did not have opportunity to protest the assessment.

(2) In the case of revocation, denial or withholding of licenses under subsection (b) of this section, a protest may be made on the grounds set forth for instances arising under paragraph (d)(1) of this section and, in addition, on the grounds that:

a. The conditions required under subsection (b) of this section do not exist; or

b. Notwithstanding the conditions required under subsection (b) of this section, the other affected person acquired the business or its assets in an arms' length transaction and neither the revokee nor any owner of 25% or more of the revokee has any interest in the acquired business.

(3) The decision of the Director under this subsection shall be final and shall not be reviewed under § 544 of this title. However, in any matter where the State shall place in issue the nonlicensure of a business, including any action under subsection (e) of this section, any person may raise any defense that may be or may have been raised under this subsection.

(e) Injunctions. — The Court of Chancery shall have jurisdiction to enjoin any person who has not first obtained a license under this part, or whose license has been revoked, denied or withheld under subsection (a) or (b) of this section, from transacting any occupation or business in this State. The Director of Revenue may proceed for this purpose by complaint in any county in which such person is doing business.

(f) Relief from this section. — The Director may issue, renew or reissue any license which has been revoked, denied or withheld under this section upon full payment of the amount stated in the Notice described in this section plus interest to the date of payment; or upon agreement for full payment plus interest and current tax obligations under such terms and conditions as the Director may deem suitable to preserve the revenues of the State.

(g) Remedies not exclusive. — Nothing in this section shall prevent the Director from:

(1) Seeking to enjoin the conduct of business by a subsequent licensee in the case of a business whose license was revoked on the ground that change of identities between the revoked licensee and the subsequent licensee is substantially without substance or a sham.

(2) Invoking remedies related to fraudulent conveyances under Title 6; or

(3) Invoking remedies related to transferee liability under this title.

67 Del. Laws, c. 40, § 6; 68 Del. Laws, c. 187, § 32; 74 Del. Laws, c. 159, § 4.;

(a) For purposes of remedies under § 2124 of this title,

(1) "Related person." — A related person is any sibling or any natural person identified in § 318(a) of the Internal Revenue Code (26 U.S.C. § 318) or, by applying the constructive ownership rules of 26 U.S.C. § 318(a), any entity in which 25% or more of whose equity is owned by a revokee, or any natural person or entity owning 25% or more of the equity of the revokee;

(2) "Revokee." — "Revokee" means a person whose business license has been revoked, denied or withheld under § 2124 of this title;

(3) "Substantially same business." — A business is substantially the same as a revokee's business if any of the following conditions exist:

a. The business location is substantially the same as the revokee's;

b. The customers are substantially the same as the revokee's;

c. The employees are substantially the same as the revokee's; or

d. The physical assets of the business are substantially the same as the revokee's.

(b) "Burden of proof." — Provided the Director shall show that a license was properly revoked, denied or withheld under § 2124 of this title, in any proceeding initiated under § 2124(e) of this title or in any other proceeding in which the State shall put in issue the nonlicensure of a business, the burden of proof shall be upon the person whose license has been revoked, denied or withheld to prove the defenses specified in § 2124(d) of this title.

74 Del. Laws, c. 159, § 5.;

The Department of Finance shall provide an anonymous reporting system for the reporting of individuals or businesses who have failed to obtain any license required under Chapter 23, 25, 27, or 29 of this title.

79 Del. Laws, c. 400, § 1.;