Tax Type
Retail Sales and Use Tax
Description
Services-Repair and Installation
Topic
Taxability of Persons and Transactions
Date Issued
10-06-1998
October 6, 1998
Re: Request for Ruling: Retail Sales and Use Tax
Dear *****
This is in reply to your letter of September 11, 1998, in which you seek information on the application of the retail sales and use tax to ***** (the "Taxpayer').
FACTS
The Taxpayer is a retailer who sells and installs floor coverings. One type of flooring it sells, laminate flooring materials or "floating floors,' consists of tongue and groove planks that are glued together to create a sheet of laminate flooring. The flooring is laid on top of a layer of foam and secured by moldings around the perimeter. The flooring is not secured to the subfloor or the floor below. You question the application of the tax to the laminate flooring.
RULING
The application of the tax to floor coverings is set forth in Code of Virginia Sec. 58.1-610 and Title 23 of the Virginia Administrative Code (VAC) 10-210-410. Tax Bulletin 92-7, issued September 15, 1992 (copy enclosed), also addresses the application of the sales tax to floor coverings.
"Floor coverings' are distinguished from "floors' themselves and are defined to include rugs, mats, padding, and wall-to-wall carpets when installed by the tack strip or stretch-in methods, and other floor coverings which are not glued, cemented, or otherwise permanently attached to the floor below. Floor coverings which are glued, cemented, or otherwise permanently attached to the floor below are deemed to be floors.
The laminate flooring described in this case is not glued down, cemented, or otherwise permanently attached to the floor below. Consequently, the laminate flooring is considered a floor covering and not a floor. The sale of a floor covering is considered a retail sale, and the seller must collect the tax from its customers on the sales price. Accordingly, the Taxpayer must collect sales tax from its customers on its sales of laminate flooring or "floating floors.'
The tax does not apply to the installation charges when separately stated on the invoice. See Code of Virginia Sec. 58.1-609.5(2). If the installation charge is not separately stated, the tax must be computed on the total invoice charge. Please note that the Taxpayer must pay tax on materials used in the installation of its floor coverings.
I hope this has responded to your inquiry. If you have additional questions, please contact ***** in the Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/17527J
Re: Request for Ruling: Retail Sales and Use Tax
Dear *****
This is in reply to your letter of September 11, 1998, in which you seek information on the application of the retail sales and use tax to ***** (the "Taxpayer').
FACTS
The Taxpayer is a retailer who sells and installs floor coverings. One type of flooring it sells, laminate flooring materials or "floating floors,' consists of tongue and groove planks that are glued together to create a sheet of laminate flooring. The flooring is laid on top of a layer of foam and secured by moldings around the perimeter. The flooring is not secured to the subfloor or the floor below. You question the application of the tax to the laminate flooring.
RULING
The application of the tax to floor coverings is set forth in Code of Virginia Sec. 58.1-610 and Title 23 of the Virginia Administrative Code (VAC) 10-210-410. Tax Bulletin 92-7, issued September 15, 1992 (copy enclosed), also addresses the application of the sales tax to floor coverings.
"Floor coverings' are distinguished from "floors' themselves and are defined to include rugs, mats, padding, and wall-to-wall carpets when installed by the tack strip or stretch-in methods, and other floor coverings which are not glued, cemented, or otherwise permanently attached to the floor below. Floor coverings which are glued, cemented, or otherwise permanently attached to the floor below are deemed to be floors.
The laminate flooring described in this case is not glued down, cemented, or otherwise permanently attached to the floor below. Consequently, the laminate flooring is considered a floor covering and not a floor. The sale of a floor covering is considered a retail sale, and the seller must collect the tax from its customers on the sales price. Accordingly, the Taxpayer must collect sales tax from its customers on its sales of laminate flooring or "floating floors.'
The tax does not apply to the installation charges when separately stated on the invoice. See Code of Virginia Sec. 58.1-609.5(2). If the installation charge is not separately stated, the tax must be computed on the total invoice charge. Please note that the Taxpayer must pay tax on materials used in the installation of its floor coverings.
I hope this has responded to your inquiry. If you have additional questions, please contact ***** in the Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/17527J
Rulings of the Tax Commissioner