Tax Type
Retail Sales and Use Tax
Description
Parent-Teachers Associations; Exemption criteria
Topic
Exemptions
Date Issued
08-04-1989
August 4, 1989
Re: Ruling Request/Sales and Use Tax
Dear*************
This will respond to your letter of May 31, 1989 in which you request that ******* be granted exempt status from paying and collecting state sales tax.
The 1986 General Assembly passed HB 149 which provided a limited exemption from the sales and use tax for Parent-Teachers Associations. This exemption is set forth in Section 58.1-608(63) of the Code of Virginia as shown below:
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- "Tangible personal property purchased for use, consumption, or sale at retail by an elementary or secondary school conducted not for profit, or Parent Teacher Association or other groups associated with an elementary or secondary school conducted not for profit in fund-raising activities, the net proceeds (gross receipts less direct expenses) of which are distributed directly to the school or used to purchase certified school equipment; and certified school equipment purchased by such groups for contribution directly to the school. For the purpose of this subdivision, "certified school equipment" shall mean that equipment for which the Parent Teachers Association or other group has received certification from the school that it will accept a donation of equipment. The certification provided by the school shall be in accordance with regulations promulgated by the Tax Commissioner. Notwithstanding the other provisions of this subdivision, the tax shall not apply to the sale of class rings, school photographs, and other fund raising programs from which an elementary or secondary school conducted not for profit receives a commission or the net proceeds after the payment of vendors and other direct expenses."
As can be seen from the above exemption, Parent Teachers Associations do enjoy the sales and use tax exemption when the above criteria are met. Purchases by a Parent Teacher Association for fund-raising purposes will be exempt only if the following criteria are met: (1) the organization must be affiliated with a nonprofit elementary or secondary school, (2) the property purchased must be used for fund-raising activities on behalf of the school, and (3) the net proceeds must be contributed directly to the school or used to purchase certified school equipment. In order to purchase items which meet the above criteria exempt of the tax, you must furnish to your suppliers an ST-13 Exemption Certificate. A supply of these exemption certificates will be forwarded to you under separate cover. No sales tax registration number will be required for use of this certificate.
In regard to previously purchased certified school equipment, the**************may issue a form ST-13 to the suppliers of this equipment to obtain a refund of the sales tax paid.
I hope this letter has answered all of your questions, however, if you should have further questions, please feel free to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner