Tax Type
Retail Sales and Use Tax
Description
Hotel accommodations and food purchased by nonprofit organizations
Topic
Taxability of Persons and Transactions
Date Issued
11-18-1988
November 18, 1988
Re: Ruling Request/ Sales and Use Tax
Dear*********************
This will reply to your letter of October 3, 1988 seeking an exemption from the retail sales and use tax for***************** (taxpayer).
FACTS
The taxpayer is a nonprofit organization exempt from federal income tax under §501(c)(3) of the Internal Revenue Code with approximately 476 affiliated agencies located throughout the United States. Each of these affiliates has its own tax exempt status.
The taxpayer is considering Virginia as a site for its 1989 annual convention. You ask whether charges for hotel accommodations and banquet and other food expenses incurred by members of your organization and affiliated agencies while attending the annual convention would qualify for any exemption from Virginia's sales and use tax.
RULING
There is no general exemption from the Virginia retail sales and use tax for nonprofit organizations. ( See Virginia Regulation 630-10-74, enclosed). The only exemptions from the tax are those set out in Virginia Code §58.1-608. (Copy enclosed). While I am mindful of the worthwhile purposes that the taxpayer and its affiliated agencies serve, absent a statutory exemption that would allow you to make purchases exempt from the tax, the department has no authority to grant such an exemption.
In addition, I have enclosed a copy of a May 27, 1988 ruling of the department which explains in more detail the application of the tax to meals and lodging sold to employees of the state and nonprofit organizations.
Based on the foregoing, neither the taxpayer nor its affiliated agencies qualify for exemption from the sales and use tax when purchasing food or hotel accommodations in connection with the taxpayer's upcoming convention.
Please let me know if the department can be of further assistance.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner