Tax Type
Retail Sales and Use Tax
Description
Foods eligible for the reduced rate party platters packaged in containers affixed with lids or tops
Topic
Assessment
Computation of Tax
Rate of Tax
Records/Returns/Payments
Date Issued
08-05-2013
August 6, 2013
Re: § 58.1-1821 Application: Retail Sales and Use Tax
Dear *****:
This will reply to your letter in which you seek correction of the retail sales and use tax assessment issued to ***** (the "Taxpayer") for the period November 2009 through July 2012. I apologize for the delay in responding to your appeal.
FACTS
The Taxpayer is a retail food franchise that sells specialty meats. In addition, the Taxpayer sells cold deli trays and party platters for business and social events. The prepackaged cold deli trays and party platters are ordered from the Taxpayer's "catering" menu. The cold deli trays and party platters are packaged in containers affixed with lids or tops. Customers may pick up the orders or have the Taxpayer deliver the prepackaged food.
During the audit, the Taxpayer prepared, packaged and sold cold deli trays and party platters and charged the 2.5% reduced sales tax rate. The auditor treated the sale of the prepackaged cold deli trays and party platters as the sale of catered food subject to the 5% retail sales tax. The auditor held the Taxpayer liable for the difference between the reduced sales tax rate and the general sales tax rate. The Taxpayer disagrees with the assessment and cites Virginia Tax Bulletins (VTB) 05-7 (5/31/05) and 99-11 (10/1/99) to support its position.
DETERMINATION
VTB 05-7 and VTB 99-11 specifically provide that cold deli trays and party platters packaged in containers affixed with lids or tops are foods eligible for the reduced rate when sold in single or multiple serving sizes and packaged for home consumption.
Based upon the tax bulletins and the fact that the Taxpayer does not provide catering services, I find that the sales at issue qualify for the reduced sales tax rate. The assessment represents the tax and interest assessed on the contested deli trays and party platters. Accordingly, the assessment will be abated in full.
The tax bulletins cited are available on-line at www.tax.virginia.gov in the Laws, Rules and Decisions section of the Department's web site. If you have any questions
about this determination, you may contact ***** in the Department's Office of Tax Policy, Appeals and Rulings, at *****.
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- Sincerely,
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Craig M. Burns
Tax Commissioner
AR/1-5221308733.T
Rulings of the Tax Commissioner