Tax Type
Retail Sales and Use Tax
Description
Lease of printing press; Commercial printing for sale or resale
Topic
Exemptions
Date Issued
07-19-1991
July 19, 1991
Re: Request for Ruling: Sales and Use Tax
Dear*************
This will reply to your letter of August 30, 1990 in which you request a ruling as to the application of the sales and use tax to printing presses employed by********* (the Taxpayer) in their printing operation.
FACTS
The Taxpayer is in the business of commercial printing for sale or resale. In 1989 the Taxpayer purchased two large printing presses through purchase/lease agreements from two separate vendors. The Taxpayer has been paying the sales tax to the vendors on the monthly lease payments. The Taxpayer is seeking an exemption from the sales and use tax on the printing presses from the vendors. The Taxpayer is also requesting the proper procedure for obtaining a refund of taxes already paid to the vendors on exempt machinery.
RULING
Virginia Regulation (VR) 630-10-86 (copy enclosed) addresses "Printing" and the sales and use tax application. Subsection 2 of this regulation states the following:
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- The printing of tangible personal property for sale or resale is deemed to be industrial manufacturing. Therefore, to the extent relevant, the provisions of § 630-10-63 apply to printing except as otherwise noted.
VR 630-10-63(B)(1) provides the definition of industrial manufacturers and processors and states, in part, "the term "industrial manufacturer" as used herein shall include but not be limited to businesses classified or substantially similar to other businesses classified in codes 20 through 39 of the Standard Industrial Classification (hereinafter "SIC") Manual published by the U.S. Department of Commerce." A review of the SIC Manual reveals that commercial letterpress, lithographic printers, screen printers and gravure printers are included in industry group 27. Therefore, the printing presses purchased by the Taxpayer would be exempt from the tax.
I have enclosed several copies of the manufacturers' exemption certificate, Form ST-11, for use by the Taxpayer in making tax exempt purchases. Reasonable care and judgment should be exercised in order to ensure proper use of all certificates issued.
In regard to a refund of taxes previously paid on tax exempt equipment, you may receive such refund from the vendor to which the tax was paid. In turn the vendor may, upon written request and verification that such taxes have been refunded to the Taxpayer, request a refund of the tax directly from the department. Alternatively, the vendor may take a credit on his monthly return in the same amount as the refund issued to the Taxpayer. In the event that the Taxpayer is unable to obtain a refund from the vendor, a refund may be obtained directly from the department. To obtain a refund directly from the department, the Taxpayer must submit copies of the invoices to the department's Taxpayer Assistance Section.
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