Document Number
95-111
Tax Type
Retail Sales and Use Tax
Description
Occasional sales, mergers; Concert sales of T-shirts and beverages
Topic
Taxability of Persons and Transactions
Date Issued
05-09-1995
May 9, 1995




Re: Request for Ruling: Retail Sales and Use Tax


Dear*****************

This will reply to your letter of March 17,1995 in which you seek a ruling on the tax status of sales made by your organization, ********** the "Taxpayer".
FACTS

The Taxpayer is a organization involved in promoting one of Virginia's cities. It sponsors free concerts during the summer at which beverages and T-shirts are sold. Proceeds from the sales are shared with nonprofit organizations. In the past, the Taxpayer has limited the number of concerts to three each year and has not collected the tax on sales made. However, this year it intends to expand the number of concerts to six. Thus, you seek a ruling on the tax status of the sales made during the concerts.
RULING

Code of Virginia § 58.1 -609.10(2) exempts from the sales and use tax occasional sales of tangible personal property. Interpreting this Code section, Virginia Regulation (VR) 630-10-75, states in part that "[t]he term 'occasional sale' means...[a] sale by a person who is engaged in sales on three or fewer separate occasions within one calendar year."

Applying the above regulation, the Taxpayer was correct in not collecting the tax on sales made during its prior concert series. However, since it will hold more than three concerts this year, it will be required to register as a dealer with the department and collect and remit the tax on all sales made during such concerts. In effect, the Taxpayer will be holding itself out as a retailer and may be in competition with businesses or other organizations which are required to collect the tax due to their sales activities. As a registered dealer, however, the Taxpayer may purchase items for resale exempt of the tax using a resale exemption certificate, Form ST-10. 1 am enclosing a copy of P.D. 90-39 (3/19190) which addresses this issue and copies of the dealer registration form (Form R-1) and instructions (Form R-4).

If you have any questions regarding this matter, please contact******** my Office of Tax Policy at*************

                        • Sincerely,



                          Danny M. Payne
                          Tax Commissioner

OTP/9483H

Rulings of the Tax Commissioner

Last Updated 08/25/2014 16:46