Tax Type
Retail Sales and Use Tax
Description
Hotel room lodging paid by employees of federal government
Topic
Taxability of Persons and Transactions
Date Issued
03-08-1990
March 8, 1990
Re: Request for Ruling/ Sales and Use Tax
Dear ****
This will reply to your letter of February 16, 1990 in which you request a ruling on the applicability of the Virginia retail sales and use tax to the rental of hotel rooms by military personnel.
Facts
Personnel of the ***** are planning a Military Law Update Conference for Naval Reserve attorneys. The conference is tentatively scheduled to be held at a Virginia hotel in September, 1990. Approximately 250 military personnel will receive orders from several separate command units to attend the conference. The military personnel will pay for the hotel lodging with personal funds and will be reimbursed by the federal government. You request a ruling on the applicability of the sales and use tax to the hotel room rental charges since the personnel will be using the hotel for a government purpose.
Ruling
Virginia Regulation 630-10-45 (copy enclosed) describes in detail how the Virginia retail sales and use tax applies to rentals of hotel rooms by the federal government and federal employees. This regulation provides in pertinent part that:
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- ...if a federal employee is traveling on government business and payment for meals and lodging is made directly by the federal government pursuant to a purchase order (e.g., by direct billing to government or use of government credit card), no tax will apply. However, if the employee pays for the meals and lodging with personal funds and will be reimbursed by the government or utilizes a travel advance, no exemption is available even though the employee may be traveling pursuant to official government orders... (Emphasis added).
- ...if a federal employee is traveling on government business and payment for meals and lodging is made directly by the federal government pursuant to a purchase order (e.g., by direct billing to government or use of government credit card), no tax will apply. However, if the employee pays for the meals and lodging with personal funds and will be reimbursed by the government or utilizes a travel advance, no exemption is available even though the employee may be traveling pursuant to official government orders... (Emphasis added).
I hope this information has answered your questions; however, please contact the department if you have additional questions.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner