Tax Type
Retail Sales and Use Tax
Description
Race car chassis component manufacturer
Topic
Exemptions
Taxability of Persons and Transactions
Date Issued
09-21-1989
September 21, 1989
Re: Ruling Request: Sales and Use Tax
Dear***************
This is in reply to your letter of June 22, 1989 in which you request a ruling as to the sales and use tax application to a Virginia corporation (the company) which is a client of******************.
FACTS
The company is in the business of manufacturing race car chassis components, including hubs and spindles, rear axle housing, axles, sway bars, tubes and snouts. These parts are sold wholesale to a national dealer network, and also on the retail level on which the company collects the tax.
RULING
Based on the information provided, the company is a fabricator as defined in Virginia Retail Sales and Use Tax Regulations §630-10-37. Furthermore, the company qualifies for the manufacturing exemption set forth under Virginia Code §58.1-608(3)(b). This section exempts tangible personal property from the tax when used directly by an industrial manufacturer or processor in the production of a product for sale or resale. As a fabricator, tax must be collected on the total charge to the customer, including separately stated labor charges.
If you should have any further questions, please feel free to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner