Tax Type
Retail Sales and Use Tax
Description
Application of Sales and Use Tax; Out-of-State Vendors
Topic
Taxability of Persons and Transactions
Date Issued
12-28-1992
December 28, 1992
Re: Ruling Request: Sales and Use Tax: Situs of Sale
Dear******************
This will reply to your letter regarding the application of the tax to four factual situations which involve a vendor which has multiple sales offices within and without Virginia. I regret the delay in issuing you a response.
In each situation an out-of-state office of the vendor negotiates with a customer and secures from that customer an order for tangible personal property to be delivered into Virginia. Like the vendor, the customer also has multiple locations within and without the Commonwealth, and in each case the purchase order is coming from the customer's out-of-state location.
While the vendor's out-of-state office takes the purchase order in each scenario, the method of delivery and/or installation varies from case to case. In Case #l the equipment is delivered to the customer by an in-state office of the vendor. In Case #2 the equipment is shipped from the vendor's out-of-state warehouse to an in-state office of the vendor for delivery to the customer. In Case #3 the equipment is delivered by an out-of-state office of the vendor directly to the customer, and an in-state office of the vendor assists in installation. In Case #4 the equipment is delivered to the customer by an in-state office of the vendor, and a second in-state office of the vendor assists in installing the equipment .
Virginia Regulation (VR) 630-10-84 provides that:
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- An out-of-state dealer who has a place of business in Virginia is required to register as a dealer at that place. If the same dealer, at a place of business outside this state, receives orders from Virginia customers directly and not through a place of business in Virginia, he must also register as an out-of-state dealer.
In each of the four factual situations, the initial purchase order is taken by an out-of-state office of the vendor, and it is that out-of-state location which is the situs of the sale.
Accordingly, the vendor's out-of-state location is required to register with the department as a dealer and to collect and remit the tax on tangible personal property sold or delivered for use or consumption in Virginia, regardless of the method of delivery and/or installation as presented in the four situations above.
Please let me know if I can answer any other questions regarding this matter.
Sincerely,
W. H. Forst
Tax Commissioner
OTP/4467I
Rulings of the Tax Commissioner