Tax Type
Retail Sales and Use Tax
Description
Cogenerator; Utilities
Topic
Exemptions
Taxability of Persons and Transactions
Date Issued
07-31-1992
July 31, 1992
Re: Request for Ruling: Sales and Use Tax
Dear**************
This will reply to your letter of June 10, 1992, in which you request a ruling on the application of the sales and use tax to a cogenerator which will process steam exclusively for sale to public utilities and other consumers.
Based upon the facts set out in your correspondence, the taxpayer qualifies for the industrial processing exemption provided in Va. Code §58.1-608 A 3 b. Consistent with the previous rulings of the department referenced in the taxpayer's letter, the taxpayer therefore may purchase exempt from the tax machinery and other tangible personal property that will be used directly in the processing of steam for sale or resale.
Under the provisions of Va. Code §58.1-610 E, the exemption will also extend to purchases by a turnkey contractor or one of its subcontractors that would otherwise be exempt if purchased directly by the taxpayer. Va. Regulation 630-10-63 explains in detail which items of tangible personal property used by an industrial processor may qualify for exemption.
In order for the contractor to make exempt purchases, it must first obtain an exemption certificate, Form ST-11A from our Technical Services Section at P. O. Box 6-L, Richmond, Virginia 23282.
Sincerely,
W. H. Forst Tax
Commissioner
Rulings of the Tax Commissioner