Tax Type
Retail Sales and Use Tax
Description
List of Exemptions, Exceptions and Exclusions
Topic
Exemptions
Date Issued
10-09-1998
October 9, 1998
Re: Request for Ruling: Retail Sales and Use Tax
Dear *****
This is in response to your letter of September 9, 1998, concerning potential retail sales and use tax exemptions available to the ***** (the "Taxpayer').
FACTS
Code of Virginia Sec.16.1-315 authorizes the governing bodies of three or more counties, cities or towns to provide for the establishment of a regional detention home or other residential care facility commission. The commission so established is designated under law as a "public body corporate' with powers set out in Article 13, Code of Virginia Sec.16.1.
The Taxpayer was established under this authority to renovate and construct a juvenile detention center in the *****. The member jurisdictions of the Taxpayer are the counties of ***** and the cities of *****.
RULING
An exemption from the retail sales and use tax is set out in Code of Virginia Sec. 58.1-609.1(4) for: "[t]angible personal property for use or consumption by the Commonwealth, any political subdivision of the Commonwealth, or the United States.'
Based on the information provided, the Taxpayer is deemed to be a political subdivision of the Commonwealth. Accordingly, the Taxpayer may purchase tangible personal property exempt of the tax by providing its vendors with a government exemption certificate, Form ST-12 (copies enclosed). Some exemption certificates are enclosed. They may be copied as needed.
The regulations governing purchases and sales by the state and its political subdivisions are set out in Title 23 of the Virginia Administrative Code 10-210-690 and 10-210-691. As noted therein, purchases of tangible personal property by the United States, the state and its political subdivisions are exempt from the tax only if the purchases are pursuant to official purchase orders to be paid for out of public funds. Sales to federal, state or local governments without the required purchase orders, or to their employees for their own consumption, are taxable. Further, the exemption does not apply to purchases of meals, lodging, or meeting/conference rooms. Sales of tangible personal property by state government and its political subdivisions are generally taxable.
Finally, the exemption generally does not extend to real property contractors with whom the Taxpayer may contract for the construction, repair, renovation or any other services with respect to real estate. Only when the credit of a government entity is bound directly and the contractor has been officially designated as the purchasing agent for the government will purchases by the contractor be exempt from the tax.
I trust this information addresses your concerns. If you have any questions regarding this letter, you may contact ***** in the department's Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/17497I
Re: Request for Ruling: Retail Sales and Use Tax
Dear *****
This is in response to your letter of September 9, 1998, concerning potential retail sales and use tax exemptions available to the ***** (the "Taxpayer').
FACTS
Code of Virginia Sec.16.1-315 authorizes the governing bodies of three or more counties, cities or towns to provide for the establishment of a regional detention home or other residential care facility commission. The commission so established is designated under law as a "public body corporate' with powers set out in Article 13, Code of Virginia Sec.16.1.
The Taxpayer was established under this authority to renovate and construct a juvenile detention center in the *****. The member jurisdictions of the Taxpayer are the counties of ***** and the cities of *****.
RULING
An exemption from the retail sales and use tax is set out in Code of Virginia Sec. 58.1-609.1(4) for: "[t]angible personal property for use or consumption by the Commonwealth, any political subdivision of the Commonwealth, or the United States.'
Based on the information provided, the Taxpayer is deemed to be a political subdivision of the Commonwealth. Accordingly, the Taxpayer may purchase tangible personal property exempt of the tax by providing its vendors with a government exemption certificate, Form ST-12 (copies enclosed). Some exemption certificates are enclosed. They may be copied as needed.
The regulations governing purchases and sales by the state and its political subdivisions are set out in Title 23 of the Virginia Administrative Code 10-210-690 and 10-210-691. As noted therein, purchases of tangible personal property by the United States, the state and its political subdivisions are exempt from the tax only if the purchases are pursuant to official purchase orders to be paid for out of public funds. Sales to federal, state or local governments without the required purchase orders, or to their employees for their own consumption, are taxable. Further, the exemption does not apply to purchases of meals, lodging, or meeting/conference rooms. Sales of tangible personal property by state government and its political subdivisions are generally taxable.
Finally, the exemption generally does not extend to real property contractors with whom the Taxpayer may contract for the construction, repair, renovation or any other services with respect to real estate. Only when the credit of a government entity is bound directly and the contractor has been officially designated as the purchasing agent for the government will purchases by the contractor be exempt from the tax.
I trust this information addresses your concerns. If you have any questions regarding this letter, you may contact ***** in the department's Office of Tax Policy at *****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/17497I
Rulings of the Tax Commissioner