Tax Type
Retail Sales and Use Tax
Description
Cable TV hand-held remotes, Broadcasting equipment
Topic
Taxability of Persons and Transactions
Date Issued
04-28-1989
April 28, 1989
Re: §58.1-1821 Application: Sales and Use Tax
Dear****************
This will reply to your letter dated January 30, 1989 in which you seek a further review of your client's case contesting the assessment of use tax on hand-held remote control units. You seek the abatement of tax and interest assessed********** as a result of its purchases of hand-held remotes.
You contend that the hand-held remotes and set top converters are exempt from the tax because they play an integral role in the sending and apportionment of cablevision signals. In addition, you maintain that the remotes qualify as accessories to transmission or distribution equipment because they add to the convenience and effectiveness of cablevision service.
I do not agree that the remotes are transmission or distribution equipment. The remotes are not accessory equipment used by the cablevision company to transmit or distribute cable signals. Rather, they are merely convenience items provided by the cable company in its provision of a nontaxable service to be used by its subscribers to change channels. As I stated in my earlier ruling letter, the cable signals have already been distributed to subscribers through the set top converter boxes. Thus, since subscribers can use the set top converters to change channels, the remotes do not qualify for exemption as equipment, or parts and accessories thereto which are used by a cable company to transmit or distribute signals.
Therefore, I find no basis for a correction of the assessment. Should you desire a conference with the department or wish to propose an offer in compromise as set forth in §58.1-105 of the Code of Virginia, please contact the department's Tax Policy Division, P. O. Box 6-L, Richmond, Virginia 23282 within thirty days of the date of this letter.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner