Tax Type
Egg Excise Tax
Description
Out-of-State Supplier, Egg Tax
Topic
Taxability of Persons and Transactions
Date Issued
10-04-1996
October 4, 1996
RE: § 58.1-1821 Application: Egg Excise Tax
Dear**********
This will reply to your letter in which you request a refund of Virginia Egg Excise Tax paid by ***********(the "Taxpayer") for the periods November 1, 1989, through October 31, 1992. I apologize for the delayed response.
FACTS
The Taxpayer, a food distributor located in Virginia, purchased eggs from an egg producer/processor located outside of Virginia. The Egg Excise Tax was not collected by the producer/processor, therefore, the Taxpayer remitted the tax to the department. The Taxpayer, now, contends that it was not required to remit the tax and is requesting a refund of the taxes remitted.
DETERMINATION
Prior to July 1, 1994, Code of Virginia § 3.1-796.11:3, copy enclosed, levied the Egg Excise Tax on eggs produced or sold in Virginia. Code of Virginia § 3.1--796.11:4(A) also provided that the handler of eggs must remit the tax to the department on the appropriate prescribed forms. The tax was collected from the first person qualifying as a handler.
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- Code of Virginia § 3.1-796.11:4(B) defined a "handler" of eggs to mean:
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- [A]ny person who operates a grading station in Virginia, a packer, huckster, or distributor who handles eggs in Virginia or a farmer who packs, processes or otherwise performs the functions of a handler in Virginia.
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- For purposes of this article, the functions of a handler of eggs include the sale, distribution or other disposition of eggs in Virginia regardless of where the eggs were produced or purchased. (Emphasis added.)
As a result, any person who produced or sold eggs that were distributed to Virginia customers was required to register for the Virginia Egg Excise Tax, and remit the tax to the department. An egg producer/processor located outside of Virginia and making sales into Virginia should have registered to collect and remit the tax to the department. If, however, such egg producer/processor was not registered for the tax or did not collect the tax, then the handler located in Virginia became liable for remitting the tax.
In the instant case, the Taxpayer purchased eggs from a producer/processor located outside of Virginia who did not collect the Egg Excise Tax. The Taxpayer, as a handler, properly registered for the tax and remitted the tax to the department on eggs purchased from the producer/processor. There is, therefore, no basis to issue a refund of the tax remitted by the Taxpayer to the department.
Effective July 1, 1994, the General Assembly changed the Egg Excise Tax to require the last handler at wholesale to collect the tax from the purchaser of shell eggs and egg products that are used or consumed in Virginia. Virginia Tax Bulletin 96-4, copy enclosed, clarifies the department's position of the current Virginia Egg Excise Tax. If there are further questions, please contact**************at*******************.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/11654N
Rulings of the Tax Commissioner