Tax Type
Retail Sales and Use Tax
Description
Application of the Sales Tax to Printing Purchased by Out-of-State Advertising Agencies
Topic
Exemptions
Date Issued
06-23-1994
Application of the Sales Tax to Printing
Purchased by Out-of-State Advertising Agencies
This bulletin is intended to notify members of Virginia's printing industry of a change to the Virginia Retail Sales and Use Tax Act effective July 1, 1994. This bulletin supersedes Tax Bulletin 93-7.
Current Rule
Under Virginia Regulation 630-10-86, an exemption exists for printed material, other than administrative supplies, stored for 12 months or less in Virginia for distribution in other states.
As set out in Virginia Regulation 630-10-3, advertising agencies are deemed to be the taxable users or consumers of all tangible personal property, including printing, used in providing media advertising services. Media advertising includes direct mail.
Accordingly, the exemption for printing distributed outside of Virginia has not been applicable to agencies providing media advertising services.
Change in Law
Effective July 1, 1994, the exemption for printed materials (other than administrative supplies) stored for 12 months or less in Virginia for distribution outside of Virginia is available to out-of-state advertising agencies.
This change in the law only applies to printing purchased by out-of-state agencies. Instate advertising agencies remain totally taxable on all printing regardless of its ultimate destination.
Documentation
Virginia Certificate of Exemption, Form ST-10A, has been revised to reflect the printing exemption now available to out-of-state advertising agencies.
Conclusion
Out-of-state advertising agencies are now entitled to the exemption for printed materials (except administrative supplies) that are for ultimate distribution outside of Virginia. Instate advertisers must continue to pay the tax on all printing used in providing media advertising services. As this bulletin address only the change in the law, it does not attempt to restate the general rules set out in the printing and advertising regulations.
Rulings of the Tax Commissioner