Tax Type
Retail Sales and Use Tax
Description
Nonprofit facilitate optimal health, and development of children and families
Topic
Exemptions
Date Issued
08-29-1990
August 29, 1990
Re: Request for Ruling: Sales and Use Tax
Dear ****
This will reply to your letter of August 13, 1990 requesting a ruling whether your organization qualifies for exemption from the sales and use tax.
FACTS
***** (the "Taxpayer"), is a nonprofit organization, exempt from income taxation under §01(c)(3) of the Internal Revenue Code, whose main goal is to improve and support policies and practices that will facilitate optimal health, mental health and development of children and families in the earliest years of life. The Taxpayer requests a ruling whether it qualifies for the sales tax exemption provided in 1990 HB 120.
RULING
As enacted by the 1990 General Assembly, HB 120 provides a sales and use tax exemption for certain nonprofit organizations offering specific social services, included, but not limited to: traveler's aid; family life education; adoption and foster care assistance; financial aid counseling; and counseling and services to persons living with mentally ill or mentally retarded persons. [See the enclosed copy of Virginia Code §58.1-608(8)(p).]
In order to qualify for the exemption, an organization must provide all of the services specified. While the Taxpayer in the present case does provide some of the services specified for the exemption, it is my understanding that it does not provide all of these services.
Accordingly, while I am mindful of the worthwhile purposes the Taxpayer serves, absent a statutory exemption that would allow the Taxpayer to make purchases exempt of the tax, the department has no authority to grant such an exemption. Therefore, the Taxpayer is required to pay the tax to its retailers on all purchases of tangible personal property. If a retailer is not registered to collect the tax, the Taxpayer must report and pay use tax on a Consumer Use Tax Return, Form ST-7.
If you have any further questions, please contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner