Tax Type
Retail Sales and Use Tax
Description
Equipment used in broadcasting; Strobe lighting kit
Topic
Exemptions
Date Issued
11-01-1984
November 1, 1984
Re: Sales and Use Tax
Dear *********
This will respond to your telephone conversation with ***** and your comments at the August 16, 1984 public hearing on the sales and use tax regulations with respect to strobe lights used on radio and television broadcast towers.
As I understand the facts of this situation, a radio station entered into a contract for the erection of a broadcast tower. In connection with this contract, the erector also furnished a separate strobe lighting kit which was required to be installed on the tower to meet Federal Aviation Administration Safety requirements. You request a determination on whether the charge for this lighting kit is exempt from the sales and use tax under the provisions of Virginia Code § 58-441.6(j).
The relevant provisions of § 58-441.6(j) exempt from the tax:
Broadcasting equipment and parts and accessories thereto and towers used or to be used by commercial radio and television companies...
Under the established judicial doctrine of strict construction of exempting statutes in favor of the taxing authority (see for example, Department of Taxation v. Progressive Community Club of Washington, Co., Va., Inc., 215 Va. 732, 213 S.E.2d 759, 1975) property which qualifies for this exemption must be broadcasting equipment, parts and accessories for broadcasting equipment or a tower. Inasmuch as the word "tower" is listed as a separate item within the exemption, it must be presumed that a tower is an item which is separate and distinct from broadcasting equipment.
The term "tower" must be given its literal meaning, i.e., the structure itself and its component parts. The fact that the strobe lighting kit was a separate facet of the contract, distinct from the tower itself is indicative of the fact that the lighting is not an integral part of the tower itself. Similarly, it cannot be held that strobe lighting kits are "broadcasting equipment." While the lighting is clearly related to broadcasting to the extent that its presence on the tower is mandated by the FAA, we cannot agree that this converts lighting to the status of broadcasting equipment.
Therefore, I must hold that strobe lighting kits separately installed on broadcast towers were properly subjected to the tax.
Sincerely,
W. H. Forst
State Tax Commissioner
Rulings of the Tax Commissioner