Tax Type
Retail Sales and Use Tax
Description
Virginia Retail Sales sad Use Tax Regulation 1-65
Topic
Reports
Date Issued
05-01-1984
May 1, 1984
Virginia Retail Sales sad Use Tax Regulation 1-65
SUBJECT: Medicines, drugs eyeglasses, and other specified items in medical and dental groups
EFFECTIVE DATE: November 15, 1983. Under the authority of Virginia Code § 58-48.6(B), this regulation is retroactive.
EXPIRATION DATE: N/A
SUPERSEDES: This regulation supersedes § 1-65 of the Virginia Retail Sales and Use Tax Regulations published January 1, 1979.
REFERENCE:
1. § 58-441.6(s), Code of Virginia
2. § 58-441.6(sl), Code of Virginia
3. § 54-524.84:1, et seq.., Code of Virginia
AUTHORITY:
1. § 58-48.6, Code of Virginia
SCOPE:
Applicable to all transactions involving the transfer of medicines, drugs, eyeglasses, and other medical and dental items.
PURPOSE:
This regulation sets forth the application of the sales and use tax to medicines, drugs, eyeglasses, and other medical and dental items.
REGULATION:
§ 1-65. Medicines, drugs, eyeglasses and other specified items in medical and dental groups. The tax does not apply to medicines, drugs, hypodermic syringes, artificial eyes, contact lenses, eyeglasses and hearing aids dispensed by or sold on prescriptions or work orders of licensed physicians, dentists, optometrists, audiologists, hearing aid dealers and fitters or ophthalmologists, and controlled drugs purchased by a licensed physician for use in his professional practice.
The tax does not apply to wheelchairs and repair parts, braces, crutches, prosthetic devices, orthopedic appliances, catheters, urinary accessories, insulin and insulin syringes, and effective July 1, 1982, equipment, devices or chemical reagents which may be used by a diabetic to test or monitor blood or urine when such items or parts are purchased by or on behalf of an individual using these items. Purchases of these items by a hospital or licensed nursing home conducted for profit or by a licensed physician for use in his professional practice are subject to tax.
Medicines and drugs specifically. (a) Sales of medicines or drugs on written prescriptions of physicians or dentists are exempt from the tax. Sales of medicines and drugs on a physician’s or dentist's telephone (oral) prescription are exempt from the tax provided the prescription is reduced to writing, signed by the pharmacist, and filed in the same manner as an original written prescription. Medicines or drugs sold pursuant to the refilling of a physician's or dentist's prescription are also exempt from the tax. Vendors making sales of medicines or drugs pursuant to physician's or dentist's prescription or in refilling the same must keep sales records segregating the prescription sales. All original prescriptions must be filed and kept available for inspection by the Department of Taxation. When a sale is made to refill a prescription, the seller's records of the refill must carry the number of the original prescription for reference.
(b) Sales of controlled drugs to a licensed physician for use in his professional practice are exempt from the tax. "Controlled drugs" are those drugs itemized under § 54-524.84:1 et seq; of the Virginia
Code.
(c) Sales of medicines or drugs to users or consumers, except when the sales are made pursuant to a prescription of a physician or dentist or as a refill of a written prescription, as referred to in paragraph
(a), are subject to the tax. Sales of medicines and drugs to hospitals and nursing homes conducted for profit are subject to the tax unless the sales are made as a result of a written prescription of a licensed nursing home. Sales to hospitals or licensed nursing homes conducted not for profit, however, are not subject to the tax. For more information about hospitals and nursing homes, see § 1-47.
(d) Purchases of drugs by the dealer for filling prescriptions are not subject to the tax and must be made under certificate of exemption.
Eyeglasses and other ophthalmic aids and supplies; ophthalmologists, optometrists and opticians. (a) Sales of eyeglasses ground on prescriptions of physicians, ophthalmologists or optometrists, including frames as an integral part, are not subject to the tax.
(b) Eyeglass frames sold in connection with the repair or replacement of eyeglasses ground on prescriptions of physicians, ophthalmologists or optometrists are not subject to the tax.
(c) Sales of eyeglass frames, optical merchandise and optical supplies by optical supply houses to dealers, including ophthalmologists and optometrists, for resale are not subject to the tax until sold at retail by such purchasers, at which time the rules set forth in this section apply.
(d) Sales of ophthalmic instruments and supplies to physicians, ophthalmologists, optometrists and other users are subject to the tax.
(e) All sales to users or consumers of eyeglass frames, sunglasses not ground on prescription, cases, solutions for cleaning eyeglasses, barometers, telescopes, binoculars, opera glasses and similar items are subject to the tax. All persons, including opticians, optometrists and ophthalmologists making such sales are required to register as dealers and to collect and pay the tax due. However, sales of eyeglass frames or repair parts for prescription eyeglasses are exempt from the tax if the prescription for the glasses is on file with the person replacing or repairing the eyeglass frames.
(f) The exemptions outlined in this regulation have no application whatever to retail sales of eyeglasses or other optical goods not prescribed by licensed optometrists or ophthalmologists. All such sales are subject to the tax.
For dentures and other prosthetic devices relating to the practice of dentistry, see § 1-33. Sections revised 7/69; 1/79; 5/84.
Rulings of the Tax Commissioner