Tax Type
Retail Sales and Use Tax
Description
National Banks; Sale or Purchase of Property, Services
Topic
Taxability of Persons and Transactions
Date Issued
08-09-1966
[Opinion from other jurisdiction]
This will acknowledge receipt of your letter of August 5, 1966, enclosing copy of an opinion of the Supreme Court, Appellate Division (New York), holding that national banks are not subject to the sales and use tax imposed under a law of that State. You also enclosed a letter from the Comptroller of the Currency to the same effect.
[Questions]
You present the following questions:
- "In light of this decision and the position of the Comptroller's office, I should like to request the opinion of your office as to whether national banks doing business in Virginia are exempt from the taxes imposed by the Virginia Retail Sales and Use Tax Act under the following situations:
"1. On purchases of property or services taxable under the Act, made within the state.
"2. On purchases of property or services taxable under the Act, made outside the state.
"3. On the sale to the public of items such as piggy banks, flags, etc. on which no profit is made.'
- "§ 1-11. Banks.=The tax applies to purchases of tangible personal property by banks for use or consumption by them.
"When any bank engages in selling, leasing or renting tangible personal property to consumers, it must register as a dealer, and collect and remit the tax due thereon to the State Tax Commissioner.
"Taxable sales by banks include, but are not necessarily limited to, sales of checks, check books, silverware, savings or piggy banks, repossessed merchandise, and gross charges for the lease or rental of tangible personal property.
"
The rental of safe deposit boxes is not subject to the tax.'
Section 58-441.46 is as follows:
"If any provision of this chapter be held unconstitutional or invalid by a court of competent jurisdiction the same shall not affect the remaining provisions of this chapter but all such provisions not held unconstitutional or invalid shall remain in full force and effect. If, however, a court of competent jurisdiction should hold that the sales tax or the use tax levied by this chapter is for any reason invalid in its relationship to national banks, it is hereby provided that State banks shall thenceforth enjoy immunity from such tax or taxes to the same extent as national banks.'
[Answer]
The New York court is not a "court of competent jurisdiction' within the meaning of the above section. Therefore, until and unless such a court holds that the tax imposed is invalid in its relationship to national banks, such banks are subject to the provisions of the act. None of the transactions mentioned in your questions is exempt. I doubt that any of the "Exclusions and exemptions' set out in § 58-441.6 would apply.
Attorney General's Opinion