Tax Type
Retail Sales and Use Tax
Description
Admissions, entertainment, and dues; Historic facilities user fees taxable; Winery facility.
Topic
Taxability of Persons and Transactions
Date Issued
05-07-1998
May 7, 1998
Re: Request for Ruling: Retail Sales and Use Tax
Dear ****
This will reply to your letter of February 23, 1998, in which you request a ruling on the application of the retail sales and use tax to certain transactions for ***** (The "Taxpayer").
FACTS
The Taxpayer is an agricultural entity which also manufactures its agricultural product into wine. The Taxpayer also wholesales and retails its wine products. The Taxpayer's retail sales are made through its onsite retail wineshop and adjacent restaurant.
The Taxpayer will rent out its meeting hall for special events, i.e., weddings, graduations, etc., during the summer months, and up to four or five times per month. If catering services are required, the customer must deal directly with the caterer. The Taxpayer will offer a "wine service" where, for a fee (per person or per bottle), wines are served during the event.
RULING
In a prior determination, Public Document (P.D.) 89-257, 09/25/89, copy enclosed, historic properties were rented to the general public for social events. The charge for the use of the facilities often included the provision of food or beverages. It was ruled that rental charges for the use of the facilities were exempt from the tax if no tangible personal property, i.e., food or beverages, was sold in conjunction with the charges for the facilities. I believe this determination closely parallels the Taxpayer's situation.
Title 23 of the Virginia Administrative Code (VAC) 10-210-4040 provides that charges for services, in this instance the rental of the facility, are generally exempt of the tax, unless the services are provided in connection with the sale of tangible personal property, in this instance the sale of wine. As provided in P.D. 89-257, only in those instances where no tangible personal property is provided by the Taxpayer in connection with the rental of the meeting hall will the charge be exempt of the tax. Otherwise, tax will be collected upon the total charge for the facility inclusive of any charges for wine.
I trust that this has responded to your concerns. If, however, you are in need of any additional information, please contact **** of the department's Office of Tax Policy at ****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/13566Q
Re: Request for Ruling: Retail Sales and Use Tax
Dear ****
This will reply to your letter of February 23, 1998, in which you request a ruling on the application of the retail sales and use tax to certain transactions for ***** (The "Taxpayer").
FACTS
The Taxpayer is an agricultural entity which also manufactures its agricultural product into wine. The Taxpayer also wholesales and retails its wine products. The Taxpayer's retail sales are made through its onsite retail wineshop and adjacent restaurant.
The Taxpayer will rent out its meeting hall for special events, i.e., weddings, graduations, etc., during the summer months, and up to four or five times per month. If catering services are required, the customer must deal directly with the caterer. The Taxpayer will offer a "wine service" where, for a fee (per person or per bottle), wines are served during the event.
RULING
In a prior determination, Public Document (P.D.) 89-257, 09/25/89, copy enclosed, historic properties were rented to the general public for social events. The charge for the use of the facilities often included the provision of food or beverages. It was ruled that rental charges for the use of the facilities were exempt from the tax if no tangible personal property, i.e., food or beverages, was sold in conjunction with the charges for the facilities. I believe this determination closely parallels the Taxpayer's situation.
Title 23 of the Virginia Administrative Code (VAC) 10-210-4040 provides that charges for services, in this instance the rental of the facility, are generally exempt of the tax, unless the services are provided in connection with the sale of tangible personal property, in this instance the sale of wine. As provided in P.D. 89-257, only in those instances where no tangible personal property is provided by the Taxpayer in connection with the rental of the meeting hall will the charge be exempt of the tax. Otherwise, tax will be collected upon the total charge for the facility inclusive of any charges for wine.
I trust that this has responded to your concerns. If, however, you are in need of any additional information, please contact **** of the department's Office of Tax Policy at ****.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/13566Q
Rulings of the Tax Commissioner