Tax Type
Retail Sales and Use Tax
Description
Taxpayer prepares direct mail advertising materials
Topic
Basis of Tax
Documents Subject to Tax
Tangible Personal Property
Date Issued
02-04-2009
February 4, 2009
Re: Request for Ruling: Retail Sales and Use Tax
Dear *****:
This is in response to your letter submitted on behalf of your client (the "Taxpayer") in which you request a ruling on the application of the retail sales and use tax to direct mail advertising.
FACTS
The Taxpayer is located in ***** and prepares direct mail advertising materials ("materials") for its customers. The materials are sent FOB shipping point from *****. Some of the materials may be delivered from the ***** post office to residents in Virginia. The Taxpayer's customers take title and possession of the materials at the Taxpayer's dock in *****. Risk of loss passes to the customers prior to transfer of possession of the materials to the U.S. Postal Service.
RULING
Virginia Code § 58.1-604 imposes "a tax upon the use or consumption of tangible personal property in this Commonwealth." Virginia Code § 58.1-602 defines use as "the exercise of any right or power over tangible personal property to the ownership thereof, except that it does not include the sale at retail of that property in the regular course of business."
-
- Title 23 of the Virginia Administrative Code 10-210-780 A provides that:
-
- The tax does not apply to sales of tangible personal property in interstate or foreign commerce. A sale in interstate or foreign commerce occurs only when title or possession to the property being sold passes to the purchaser outside of Virginia and no use of the property is made within Virginia.
In this instance, the Taxpayer's customers do not exercise any right or power over the materials in Virginia. The transaction represents a sale in interstate commerce because title or possession to the property being sold passes to the purchaser outside of Virginia and no use of the property is made in Virginia. In accordance with the aforementioned references, the Taxpayer would not be liable for the Virginia retail sales and use tax on the transaction described in the ruling request.
This response is based on the facts provided as summarized above. Any change in facts or the introduction of new facts may lead to a different result.
The Code of Virginia sections and regulation cited are available on-line at www.tax.virginia.gov in the Tax Policy Library section of the Department's web site. If you have any questions about this ruling, you may contact ***** in the Department's Office of Tax Policy, Appeals and Rulings, at *****.
-
-
-
-
-
-
-
- Sincerely,
-
-
-
-
-
-
-
-
-
-
-
-
-
- Janie E. Bowen
Tax Commissioner
- Janie E. Bowen
-
-
-
-
-
-
AR/1-1835583534.P
Rulings of the Tax Commissioner