Tax Type
Retail Sales and Use Tax
Description
Property Purchased by Prison Ministry
Topic
Taxability of Persons and Transactions
Date Issued
05-10-1988
May 10, 1988
Re: Ruling Request
Sales and Use Tax
Dear***********
This is in reply to your letter of September 11, 1987 in which you request a ruling regarding the applicability of the exemption from the Retail Sales and Use Tax for churches to your organization,
FACTS
**********(Taxpayer) is an organization exempt from income taxation under §501 (c)(3) of the Internal Revenue Code. It was formed in 1975 for the purpose of providing a prison ministry-by bridging the gap between the prison and the community. Taxpayer ministers to the prisoners in jail through counseling, bible study and worship services. In addition Taxpayer provides clothes and food to prisoners and their families and provides assistance to prisoners with finding jobs after their release.
RULING
Virginia Code §58.1-608.38 exempts from the sales and use tax, certain tangible personal property when purchased by a nonprofit church for use in carrying out the work of the church. The department has previously addressed the application of the tax to an organization nearly identical in nature to your organization (see enclosed ruling dated November 29, 1985).
Although Taxpayer sponsors and conducts worship services for prison inmates at various prison facilities and carries on many other worthy activities, the participants in these services do not constitute a congregation or church membership. Nor are such worship services conducted at a single location. Accordingly, the church exemption does not apply based upon the policy set forth in the enclosed ruling.
It should be noted that Virginia law does not provide a general sales and use tax exemption to nonprofit organizations such as yours. As such, nonprofit organizations are subject to the tax unless specifically exempted by law (see Virginia Regulation 630-10-74, enclosed). Based on this, Taxpayer does not qualify for an exemption from the tax under current law.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner