Tax Type
Retail Sales and Use Tax
Description
Nonprofit organizations, private schools, and churches; Animal agriculture organization
Topic
Taxability of Persons and Transactions
Date Issued
05-03-1996
May 3, 1996
Re: Request for Ruling: Retail Sales and Use Tax
Dear***********
This is in reply to your letter of December 28, 1995 in which you seek exemption from the retail sales and use tax for the *********.
The********is a nonprofit public education foundation exempt from federal taxation under § 501(c)(3) of the Internal Revenue Code. ********educates the public about American livestock and poultry production and the agricultural industry's food products.
*********produces and distributes a number of educational materials in an effort to provide the public with science based information about animal agriculture. In addition,*******funds several research projects, including public opinion polls on animal agriculture.
There is no general exemption from the retail sales and use tax for nonprofit organizations. The only exemptions from the tax are set out in Code of Virginia §§ 58.1--609.1 through 58.1-609.10 (copy enclosed). The Virginia courts have consistently required strict construction of these exemptions, i.e., where there is any doubt as to the application of an exemption, the doubt is resolved against the one claiming the exemption.
Based on the information presented, *****does not qualify for the exemptions in Code of Virginia § 58.1-609. While I am mindful of the worthwhile purpose that *****serves, absent a statutory exemption that would allow *******to make purchases exempt of the tax, the department has no authority to grant such an exemption. ***therefore, should continue to pay the tax to its vendors on all purchases of tangible personal property. If a vendor is not registered to collect the tax, *** must report and pay use tax on a Consumer's Use Tax Return, Form ST-7.
Enclosed is a questionnaire for legislative consideration of a sales and use tax exemption request and Tax Bulletin 94-13, which explains the procedure and information required. If you are interested in pursuing legislation during the 1997 General Assembly Session, the questionnaire should be completed and forwarded to a legislator who will sponsor the exemption bill. The legislator must sign the questionnaire and submit it to the department by November 1, 1996.
If you have any questions concerning this letter, you may contact********** at*****.
Danny M. Payne
Tax Commissioner
OTP/11132J
Re: Request for Ruling: Retail Sales and Use Tax
Dear***********
This is in reply to your letter of December 28, 1995 in which you seek exemption from the retail sales and use tax for the *********.
FACTS
The********is a nonprofit public education foundation exempt from federal taxation under § 501(c)(3) of the Internal Revenue Code. ********educates the public about American livestock and poultry production and the agricultural industry's food products.
*********produces and distributes a number of educational materials in an effort to provide the public with science based information about animal agriculture. In addition,*******funds several research projects, including public opinion polls on animal agriculture.
RULING
There is no general exemption from the retail sales and use tax for nonprofit organizations. The only exemptions from the tax are set out in Code of Virginia §§ 58.1--609.1 through 58.1-609.10 (copy enclosed). The Virginia courts have consistently required strict construction of these exemptions, i.e., where there is any doubt as to the application of an exemption, the doubt is resolved against the one claiming the exemption.
Based on the information presented, *****does not qualify for the exemptions in Code of Virginia § 58.1-609. While I am mindful of the worthwhile purpose that *****serves, absent a statutory exemption that would allow *******to make purchases exempt of the tax, the department has no authority to grant such an exemption. ***therefore, should continue to pay the tax to its vendors on all purchases of tangible personal property. If a vendor is not registered to collect the tax, *** must report and pay use tax on a Consumer's Use Tax Return, Form ST-7.
Enclosed is a questionnaire for legislative consideration of a sales and use tax exemption request and Tax Bulletin 94-13, which explains the procedure and information required. If you are interested in pursuing legislation during the 1997 General Assembly Session, the questionnaire should be completed and forwarded to a legislator who will sponsor the exemption bill. The legislator must sign the questionnaire and submit it to the department by November 1, 1996.
If you have any questions concerning this letter, you may contact********** at*****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/11132J
Rulings of the Tax Commissioner