Tax Type
Retail Sales and Use Tax
Description
Restaurant meal prices; Request to include sales taxes
Topic
Taxability of Persons and Transactions
Date Issued
04-01-1996
April 1, 1996
Re: Request for Ruling: Retail Sales and Use Tax
Dear***************
This will reply to your letter of October 10,1995, requesting permission to include sales tax in the sales price of items listed in the menu prices for ****** (the "Taxpayer").
The Taxpayer, a restaurant, is currently including the sales tax in their menu prices. The Taxpayer was recently informed by a representative of the**** District Office that the inclusion of the tax in its menu prices was improper pursuant to Virginia Regulations (VR) 630-10-24 (A). The Taxpayer now seeks permission from the department to include the tax in the sales price of its menu prices.
Code of Virginia § 58.1-625 provides that a dealer is required to separately state the amount of the tax from the sales price or charge. VR 630-10-24(A) further provides that "[i]dentification of the tax by a separate writing or symbol is not required provided that the amount of the tax is shown as a separate item on the record of transaction."
However, Code of Virginia § 58.1-614 (D) provides that when a dealer is able to demonstrate to the satisfaction of the Tax Commissioner that it is impractical to collect the tax in accordance with the bracket system it may be authorized to remit an amount based on a percentage of gross receipts which takes into account the inclusion of the sales tax.
Based on the circumstances outlined in your letter and under the provisions set forth in Code of Virginia § 58.1-614 (D), permission is hereby granted for the Taxpayer to include the tax in its menu item prices prospectively from the date of the Taxpayer's letter, October 10, 1995. This permission applies only to the retail sales and use tax. The Taxpayer will have to seek separate permission from its locality to include the local meal and beverage tax in its menu item prices.
I have enclosed P.D. 95-11 (01/19/95) for further instructions regarding price listings and the method to determine the amount of sales tax which must be remitted to the department. If you have any questions regarding this ruling, please contact*** at the department's Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/10814T
Re: Request for Ruling: Retail Sales and Use Tax
Dear***************
This will reply to your letter of October 10,1995, requesting permission to include sales tax in the sales price of items listed in the menu prices for ****** (the "Taxpayer").
FACTS
The Taxpayer, a restaurant, is currently including the sales tax in their menu prices. The Taxpayer was recently informed by a representative of the**** District Office that the inclusion of the tax in its menu prices was improper pursuant to Virginia Regulations (VR) 630-10-24 (A). The Taxpayer now seeks permission from the department to include the tax in the sales price of its menu prices.
RULING
Code of Virginia § 58.1-625 provides that a dealer is required to separately state the amount of the tax from the sales price or charge. VR 630-10-24(A) further provides that "[i]dentification of the tax by a separate writing or symbol is not required provided that the amount of the tax is shown as a separate item on the record of transaction."
However, Code of Virginia § 58.1-614 (D) provides that when a dealer is able to demonstrate to the satisfaction of the Tax Commissioner that it is impractical to collect the tax in accordance with the bracket system it may be authorized to remit an amount based on a percentage of gross receipts which takes into account the inclusion of the sales tax.
Based on the circumstances outlined in your letter and under the provisions set forth in Code of Virginia § 58.1-614 (D), permission is hereby granted for the Taxpayer to include the tax in its menu item prices prospectively from the date of the Taxpayer's letter, October 10, 1995. This permission applies only to the retail sales and use tax. The Taxpayer will have to seek separate permission from its locality to include the local meal and beverage tax in its menu item prices.
I have enclosed P.D. 95-11 (01/19/95) for further instructions regarding price listings and the method to determine the amount of sales tax which must be remitted to the department. If you have any questions regarding this ruling, please contact*** at the department's Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/10814T
Rulings of the Tax Commissioner