Tax Type
Retail Sales and Use Tax
Description
Agriculture; Cab Covers for Farm Equipment and Machinery
Topic
Taxability of Persons and Transactions
Date Issued
06-23-1992
June 23, 1992
Re: Request for Ruling: Sales and Use Tax
Dear***************
This will reply to your letter of April 17, 1992 in which you seek a ruling as to the sales and use tax application to cab covers for farm equipment and machinery.
I would first like to point out that the list enclosed with your letter setting forth taxable and exempt agricultural machinery and equipment is not the official opinion of the department. The purpose of the list is to provide the agricultural industry with general guidelines as to the sales and use tax application to the industry. The exemption is dependent upon the use of the equipment; therefore, equipment purchased and used by one individual may qualify for exemption, while the same equipment purchased for use in a different manner by another individual may be subject to the tax. While the department has maintained a similar list in the past, it no longer maintains one and does not plan to adopt the attached list or authorize the publication of any list now or in the near future.
FACTS
(the Taxpayer) is questioning the taxing of cab covers when purchased and installed subsequent to the initial purchase of the equipment, as opposed to exempting cab covers on farm equipment when installed at the factory.
RULING
Va. Code §58.1-608(A)(2)(a) provides a sales and use tax exemption for farm machinery and supplies sold to and purchased by farmers for use in agricultural production for market. As provided in your letter, cab covers enable farmers to operate their farm machinery and equipment for extended periods of time required to justify their capital investment. Based on the purpose of a cab cover, I find that cab covers, whether purchased with the equipment or installed at a later date, are directly used by a farmer in agricultural production for market. Therefore, such covers may be purchased exempt from the tax .
If you should have any further questions, feel free to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
TPD/6117K
Rulings of the Tax Commissioner