Tax Type
General Provisions
Description
VIRGINIA BEER AND BEVERAGE EXCISE TAY REGULATIONS
Topic
Reports
Date Issued
01-01-1984
VIRGINIA BEER AND BEVERAGE EXCISE TAY REGULATIONS
VIRGINIA DEPARTMENT OF TAXATION
January 1, 1985
INTRODUCTION
These regulations for the Virginia Beer and Beverage Excise Tax are published by the authority granted the State Tax Commissioner under Virginia Code §58-48.6 (Section 58-1-203 effective January 1, 1985) and are subject to amendment, revision and supplemental regulations as required or appropriate.
Amendments, revisions and updates to these regulations will be issued as replacement pages, each replacement page having on it the date of revision.
Each regulation section is numbered to reference the section of Title 58.1 of the Code of Virginia which it interprets. The first three digits, 630, identify these regulations, for purposes of the Virginia Register of Regulations, as regulations of the Department of Taxation. The digits following the first hyphen indicate the tax type, and the digits following the second hyphen indicate the section of Title 58.1 being interpreted. For example, the section number 630-21-700, identifies the agency (630), the beer and beverage excise tax (21), and the section of Title 58.1, Code of Virginia, which is interpreted (700).
W. H. Forst
State Tax Commissioner
Virginia Department of Taxation
P. O. Box 6-L
Richmond, Virginia 23282
VIRGINIA BEER AND BEVERAGE EXCISE TAX REGULATIONS
EFFECTIVE DATE: January 1, 1985, with retroactive effect according to § 58-48.6 (recodified as §58.1-203).
EXPIRATION: N/A
SUPERSEDES: All previous documents and any oral directives in conflict herewith.
REFERENCES: Code of Virginia §§ 58.1-700 through 58.1-718 are regulated herein.
AUTHORITY: § 58-48.6, Code of Virginia, and §58.1-203 on and after January 1, 1985.
SCOPE: Applicable to all taxpayers subject to beer and beverage excise tax.
SUMMARY: These are initial regulations interpreting certain provisions of the Virginia beer and beverage excise tax, consisting of §§ 630-21-700 through 630-21-718.
ADOPTION DATE: September 19, 1984
TABLE OF CONTENTS
Regulation Section Page
630-21-700 DEFINITIONS
-
- Barrel
-
-
-
- Beer
Beverage
Bottle-
- Bottler
Licensed
Manufacturer
Retailer
Sale and sell
Wholesaler -
- Beer
-
-
-
- Barrel
630-21-701 EXCISE TAX LEVIED; RATE
630-21-702 WHEN SELLER TO PAY TAX
-
-
-
-
-
- Generally
- Generally
-
-
-
-
630-21-704 MONTHLY REPORTS; PAYMENT OF TAX
-
- Generally
- Generally
Generally
630-21-706 COMMISSIONS
-
- Generally
- Generally
OF MANUFACTURERS, BOTTLERS,
-
-
-
- WHOLESALERS AND OPERATORS OF
-
-
630-21-708 RECORDS, INVOICES AND ACCOUNTS
-
-
-
- OF RETAILERS
- OF RETAILERS
-
-
-
-
-
-
-
- FOR FAILURE TO KEEP PROPER RECORDS
Generally
- FOR FAILURE TO KEEP PROPER RECORDS
-
-
-
-
630-21-710 INSPECTION
-
-
-
-
-
- Generally
-
-
-
-
630-21-711 CONTRACT WITH TAX COMMISSIONER
-
-
-
-
-
- Generally
-
-
-
-
630-21-712 BOND REQUIRED TO SECURE TAX
-
- LIABILITY
- LIABILITY
630-21-714 ADDITIONAL PENALTIES
630-21-715 REFUND OF TAXES ON BEER AND
BEVERAGES SUBSEQUENTLY DESTROYED
OR DAMAGED
Generally
630-21-716 REFUND OF TAX PAID ON EXEMPT
-
- BEER AND BEVERAGES
630-21-717 DISPOSITION OF MONEY COLLECTED
Generally
630-21-718 TAX COMMISSIONER TO ENFORCE
CHAPTER, REGULATIONS RELATING
TO TRANSPORTATION
Generally
BEER AND BEVERAGE EXCISE TAX REGULATIONS
630-21-700. DEFINITIONS. For the purpose of this regulation:
1) "Barrel" means any container or vessel having a capacity which exceeds forty-three (43) ounces.
2) "Beer" means any beverage containing more than three and two-tenths percent
(3 2/10%) alcohol by weight obtained by the alcoholic fermentation of an infusion or decoction of barley malt, hops or a similar product in drinkable water, unless expressly provided as other "alcoholic beverages" (alcohol, spirits, wine) in Chapter 1, Title 4, Code of Virginia. Ale, porter and stout are included within this definition.
3) "Beverage" means beer, wine, similar fermented malt or vinous liquor or fruit juice which contains one-half of one percent (.5%) or more of alcohol by volume, and not more than. three and two tenths percent (3 2/10%) of alcohol by weight.
4) "Bottle" means any vessel intended to contain liquids with a capacity not exceeding forty-three (43) ounces.
5) "Bottler" means any person licensed to bottle and sell beer or beverages to other persons for resale only.
6) "ABC Commission" means the Virginia Alcoholic Beverage Control Commission.
7) "Licensed" means the holding of a valid license issued by the Virginia Alcoholic Beverage Control Commission pursuant to § 4-25 or § 4-102, Code of Virginia.
8) "Manufacturer" means any person licensed to manufacture beer or beverages for sale to other persons for resale. This definition includes any person licensed as a brewery located within Virginia, and every person holding a beer importer's license who enters into an agreement as defined in § 4-118.4 with any beer wholesaler licensed to do business in Virginia.
9) "Retailer" means any person licensed to sell beer or beverages at retail only and not for resale.
10) "Sale" and "sell" means transfer by gift, exchange, barter and traffic, and any delivery of beer or beverages; soliciting or receiving an order for beer or beverages; keeping, offering or exposing beer or beverages for sale; or peddling.
11) "Wholesaler" means any person licensed to sell beer or beverages, as defined herein, to retailers or other beer or beverage wholesalers for the purpose of resale.
630-21-701. EXCISE TAX LEVIED; RATE.
An excise tax is levied on all beer and beverages sold in Virginia and is required to be paid by the manufacturer, bottler or wholesaler selling such beer or beverages to persons licensed to sell beer at retail. The following rates apply:
1) Seven dollars and ninety-five cents ($7.95) per barrel of thirty-one (31) gallons, and a tax at the same rate per barrel of more or less than thirty-one (31) gallons;
2) Two cents (2) per bottle of seven (7) ounces or less;
3) Two and sixty-five hundredths cents (2 65/100) per bottle of more than seven (7) ounces but not more than twelve (12) ounces;
4) Two and twenty two one hundredths (2 22/100) mills per ounce per bottle of more than twelve (12) ounces.
Example 1.
Wholesaler B gives a barrel of beer for a trade association picnic. The beer excise tax is levied upon such beer since the term "sale" includes the transfer by gift, exchange, barter and traffic, and any delivery of beer or beverages.
630-21-702. WHEN SELLER TO PAY TAX.
A) Generally. Any person selling or offering for sale in Virginia any beer or beverages purchased or obtained from any person not licensed either as a manufacturer, bottler or wholesaler and upon which the excise tax imposed by this chapter has not been paid, shall pay the tax.*
630-21-703. EXEMPTIONS.
The excise tax will not be chargeable against any manufacturer, bottler or wholesaler on any beer or beverages:
1) Shipped out of Virginia by such manufacturer, bottler or wholesaler for resale outside of Virginia. This exemption will be allowed only if evidence satisfactory to the Commissioner is submitted to the Department in writing that such beer or beverages were so shipped.
2) Sold to the United States or to any instrumentality thereof for resale to or use or consumption by the members of the armed services of the United States.
3) Sold to the Veterans Administration for resale to veterans of the armed services of the United States who are hospitalized or domiciled in hospitals and homes of the Veterans Administration within Virginia.
4) Shipped to a post exchange of the armed services of the United States for resale by such post exchange, whether or not such post exchange is located on a United States military or naval reservation. This exemption shall be allowed only if evidence satisfactory to the Commissioner is submitted to the Department in writing that such beer or beverages were so shipped.
5) Shipped to any instrumentality of the United States which is exempt on constitutional grounds from the excise tax. This exemption shall be allowed only if evidence satisfactory to the Commissioner is submitted to the Department in writing that such beer or beverages were so shipped.
6) Sold and delivered to foreign ships or aircraft actually engaged in foreign commerce or commerce between any ports of the United States or commerce between the United States and any of its possessions outside the several states and the District of Columbia.
Example 1.
Wholesale dealer A sells beer to commissaries operated by the U.S. Army as instrumentalities of the United States. Such beer is exempt from the beer excise tax since it is sold to an instrumentality of the United States for resale to members of the armed services of the United States.
Example 2.
Wholesale dealer B sells beer to the Post Enlisted Men's Club. The Club is not owned or operated by the Department of Defense or an instrumentality of the United States. Such beer is subject to the beer excise tax since it is not sold to the United States and the club is not considered an instrumentality of the United States.
Example 3.
Wholesale dealer C sells beer to the Air Force Post Exchange not located on the military reservation. Such beer is sold by the post exchange. The post exchange is organized, owned, and operated by the Department of Defense. Such beer is exempt from the beer excise tax since the beer is shipped to a post exchange of the armed services of the United States for resale by such post exchange even though it is not located on a United States military or naval reservation.
Example 4.
Wholesale dealer D sells beer to Airline XYZ located at Washington National Airport and delivers the beer to the storage facilities of the airline. Airline YYZ operates intrastate, interstate and in foreign commerce. Such beer is subject to the beer excise tax since the exemption is limited to beer sold and delivered to specific aircraft actually engaged in foreign commerce or commerce between the United States and any of its possessions outside the several states and the District of Columbia.
Example 5.
Brewery A stores, in Virginia, kegs of beer manufactured at its North Carolina location, but stored in Virginia solely for the purpose of transshipment to destination outside Virginia. Such beer is exempt from the Virginia beer excise tax because it is stored in Virginia solely for transshipment to destinations outside of Virginia.
630-21-704. MONTHLY REPORTS; PAYMENT OF TAY.
Generally. On or before the tenth (10th) day of each month, each person manufacturing, bottling or selling beer or beverages in Virginia will file a report under oath with the Tax Commissioner. The report will be on forms prescribed by the Commissioner and will show the quantity of all beer and beverages manufactured, bottled or sold during the preceding month. The report will also show the amount of beer and beverage tax owed, and any other information which the Tax Commissioner may require.
1) Exception. Corporations licensed to sell beer or beverages in dining cars, buffet cars, club cars or boats will have thirty (30) days from the end of each month to file the reports.
2) Payment of taxes. The person filing the report will, at the time of filing, pay the Tax Commissioner all beer and beverage excise taxes chargeable against him, unless such taxes have been previously paid.
3) Applicability. The provisions regarding the filing of monthly reports will not be applicable to any person licensed to sell beer or beverages at retail and who purchases them solely from manufacturers, bottlers or wholesalers licensed in Virginia, if such person has duly filed with the Tax Commissioner a contract or agreement pursuant to § 58.1-711 and regulations thereunder.*
630-21-705. FILING BY NONRESIDENT MANUFACTURERS.
Generally. On or before the fifteenth (15th) day of each month, non-resident manufacturers will forward a copy of each invoice required pursuant to § 58.1-707 or a listing of all such invoices for the preceding month to the ABC Commission and the Tax Commissioner. This requirement is a condition of shipment into Virginia or for doing business in Virginia.*
630-21-706. COMMISSIONS.
Generally. Any person filing the report required by § 58.1-704 and paying the beer and beverage excise tax required by § 58.1-701 will be allowed a commission of one percent (1%) of the amount of tax due as compensation for the expense of maintaining records and preparing reports to account for and remit the beer and beverage tax.
1) This commission will also be allowed as compensation for the expense, if any, of
compliance with the § 58.1-712 bond requirements.
2) The commission will be accounted for in the form of a deduction from the amount of
tax which would otherwise be due.*
630-21-707. RECORDS, INVOICES AND ACCOUNTS OF MANUFACTURERS, BOTTLERS, WHOLESALERS AND OPERATORS OF BOATS AND DINING CARS.
A) Every manufacturer, bottler or wholesaler licensed in Virginia will keep a complete and accurate record of all beer and beverages manufactured, bottled, purchased, sold or shipped by him. The records will show:
1) the quantities of all such beer and beverages manufactured, bottled, purchased, sold or shipped;
3) the names and addresses of all persons to or from whom such sales, purchases and deliveries, are made; and
4) the price charged.
B) Every manufacturer and wholesaler, at the time of delivering beer or beverages, will also prepare a duplicate invoice showing:
1) the date of delivery;
3) the name of the purchaser to whom the delivery is made.
B) Persons operating boats, dining cars, buffet cars and club cars upon or in which beer or beverages are sold, will keep records of the sale of the beer and beverages in Virginia and report the tax to the Tax Commissioner monthly as regulated in 630-21-704. However, the Virginia wholesaler who sells to beer retailers who operate trains which originate in Virginia, must pay the tax on all beer sold to such retailers, regardless of where the beer is actually consumed.
Example 1
A multistate railroad company purchases beer from a Norfolk beer wholesaler for a train which travels from Norfolk to Chicago. The railroad company must pay beer excise tax on total purchases because the beer is sold by a Virginia wholesaler to a licensed retailer in Virginia.
Example 2
A multistate railroad company purchases beer from a Florida wholesaler for its Miami to New York train. The railroad company must pay the Virginia beer excise tax on the portion of beer sold within Virginia. The Virginia excise tax is due because the beer sold in Virginia was purchased from a person who was not a Virginia licensed manufacturer, bottler, or wholesaler and the Virginia tax was not previously paid.
630-21-708. RECORDS, INVOICES AND ACCOUNTS OF RETAILERS.
A) Every retailer will keep a complete and accurate record of:
1) all purchases of beer and beverages;
2) the dates of the purchases;
3) the prices charged; and
4) the names and addresses of the persons from whom purchased.
B) Every retailer, other than one who has signed an agreement pursuant to § 58.1-711, will also keep an accurate account of daily sales showing quantities of beer and beverages sold and the total price charged by him. The account need not give the names or addresses of his purchasers.*
630-21-709. RETENTION OF RECORDS; PENALTY FOR FAILURE TO KEEP PROPER RECORDS.
Generally. 1) A copy of all records and invoices required by §§ 58.1-707 and 58.1-708 will be retained by the manufacturer, bottler, wholesaler or retailer for a period of three (3) years.
2) The records and invoices will be subject to the use and inspection of the ABC Commission and the Tax Commissioner or their agents.
3) Any person who, upon demand of the ABC Commission or the Tax Commissioner, fails to produce the records or invoices, upon conviction will be guilty of a Class 2 misdemeanor.*
630-21-710. INSPECTION.
Generally. 1) All records, invoices and accounts required by § 58.1-707 and § 58.1-708 will be kept by each manufacturer, bottler, wholesaler and retailer at the place of business designated in his license and will at all times be open to inspection by the ABC Commission, the Tax Commissioner and any of their designated agents.
2) The ABC Commission, the Tax Commissioner and their agents will be allowed free access during business hours to every place in Virginia where alcoholic beverages are manufactured, bottled, stored, offered for sale or sold, for the purpose of examining and inspecting such place and all records, invoices and accounts.*
630-21-711. CONTRACT WITH TAY COMMISSIONER.
Generally. 1) Every retailer of beer or beverages will file a satisfactory contract or agreement with the Tax Commissioner stating that the retailer will purchase beer or beverages for resale only from manufacturers, bottlers, or wholesalers licensed in Virginia.
2) In lieu of filing a contract or agreement, corporations licensed to sell beer or beverages on dining cars, club cars, buffet cars or boats may file a bond with Tax Commissioner. The bond will be in sufficient penalty and surety as the Commissioner may find to cover the tax liability of the corporation, but in no event will the bond be less than one thousand dollars ($1,000.00).
3) The Tax Commissioner will promptly notify the ABC Commission of each bond filed, each contract or agreement entered into, and each amendment, cancellation or violation thereof.
4) Any person who violates the terms of the contract or agreement, upon conviction, will be guilty of a Class 2 misdemeanor.*
630-21-712. BOND REQUIRED TO SECURE TAY LIABILITY.
A) No manufacturer, bottler or wholesaler will be licensed to sell beer or beverages to a licensed retailer until he files a bond with the Tax Commissioner.
1) The bond will be of sufficient sum and surety as the Commissioner finds adequate to cover the tax liability of the manufacturer, bottler or wholesaler. The sum of the bond will be proportioned to the volume of business, but in no event will it be less than one thousand dollars ($1,000.00) or more than one hundred thousand dollars ($100,000.00).
a) In the absence of information to the contrary, the total amount of wholesaler's tax liability for the two (2) highest months of the preceding twelve (12) months will generally be deemed a sum sufficient for the required bond.
3) The bond will be conditioned upon the payment of the beer and beverage tax imposed upon each manufacturer, bottler or wholesaler.
a) In the event a properly bonded manufacturer, bottler or wholesaler who is licensed to sell beer and malt beverages to licensed retailers fails to file the monthly report or pay the tax required by § 58.1-704, the State Tax Commissioner may collect from the surety or bond the amount of tax, penalty and interest owed for the delinquent period.
B) 1) The Tax Commissioner is authorized to waive the requirement of both the surety and the bond in cases where the manufacturer, bottler or wholesaler has previously demonstrated his financial responsibility.
- a) The demonstration of financial responsibility may be determined on the basis of the individual facts and circumstances of each taxpayer. However, a taxpayer who has not been late more than twice in filing and paying the tax within the two prior years, may not be required to post the bond. However, the determination on the waiver of the bond is made on a case by case basis.
3) Any manufacturer, bottler or wholesaler who has filed a bond pursuant to comparable requirements of any section of Chapter 1, Title 4, will not be required to file an additional bond hereunder if the bond filed pursuant to the other section is conditioned upon and sufficient to cover the tax liability of the manufacturer, bottler or wholesaler under this section and such other requirements.
630-21-713. PENALTIES.
A) 1) Any person, except as provided herein, who sells beer or beverages to retailers or consumers without paying the beer and beverage excise tax will be deemed guilty of a Class 1 misdemeanor.
2) Any retailer, except as provided herein, who purchases, receives, transports, stores or sells any beer or beverages on which the retailer has reason to know the beer and beverage excise tax has not been paid or may not be paid, will be deemed guilty of a Class 1 misdemeanor.
B) Any person who fails, neglects or refuses to comply with or violates any provision of this chapter which contains no specific penalty for the violation thereof, or any of the rules and regulations prescribed, adopted and promulgated by the Tax Commissioner under the provisions of this chapter, will be, upon conviction, guilty of a Class 2
misdemeanor.*
630-21-714. ADDITIONAL PENALTIES.
1) Failure to file and pay tax. If a manufacturer, bottler or wholesaler fails to make any return and pay the beer and beverage excise tax due, a penalty of five percent (5%) of the tax due will be added to the tax if the failure is for not more than thirty (30) days; with an additional five percent (5%) for each additional thirty (30) days, or fraction thereof, during which the failure continues. This penalty shall not exceed twenty-five percent (25%) in total.
2) False or fraudulent return. Where willful intent exists to defraud Virginia of any tax due under this chapter, a penalty of fifty percent (50%) of the amount of tax due will be assessed.
3) Collection. All penalties and interest imposed by this chapter will be payable to the Tax Commissioner and, if not paid, will be collected in the same manner as if they were a part of the tax imposed.
4) Suspension/Revocation of License. The Tax Commissioner will promptly notify the ABC Commission of each failure on the part of a manufacturer, bottler, wholesaler or retailer to pay such tax. Upon receipt of the notice, the ABC Commission, with reasonable notice to the manufacturer, bottler, wholesaler or retailer, may suspend or revoke the license of the manufacturer, bottler, wholesaler or retailer.*
630-21-715. REFUND OF TAXES ON BEER AND BEVERAGES SUBSEQUENTLY DESTROYED OR DAMAGED.
Generally. In any case in which beer or beverages are:
a) Damaged, destroyed or otherwise deemed to be unassailable by reason of fire or any other providential cause before sale to the consumer; or
b) Destroyed voluntarily because the beer or beverages were defective and the destruction was made in the presence of an inspector of the ABC Commission who certifies to it by affidavit; or
c) Destroyed in any manner while in possession of a common, private or contract carrier; the manufacturer, bottler or wholesaler will make a report of the damage to the Tax Commissioner as a portion of the report required by § 58.1-704. If the beer and beverage tax has been paid and the refund is at least fifty dollars ($50.00), the Tax Commissioner will certify such facts to the Comptroller for approval of a refund payment from the state treasury. If the beer and beverage tax has been paid and the refund is less than fifty dollars ($50.00), the Tax Commissioner, or his agent, will allow a credit upon the report required by § 58.1-704.*
630-21-716. REFUND OF TAY PAID ON EXEMPT BEER AND BEVERAGES. Generally. Whenever it is proved to the satisfaction of the Tax Commissioner that any person has paid the tax imposed by this chapter on beer or beverages that have been sold by him in a manner as to be exempt from the beer and beverage excise tax, the Tax Commissioner will certify such facts to the Comptroller for approval of a refund payment from the state treasury.*
630-21-717. DISPOSITION OF MONEY COLLECTED.
Generally. All monies collected by the Tax Commissioner under the provisions of this chapter will be paid into the general fund of the state treasury.*
630-21-718. TAX COMMISSIONER TO ENFORCE CHAPTER; REGULATIONS RELATING TO TRANSPORTATION.
Generally. No beverages as defined by regulation 630-21-700, or beer as defined by regulation 630-21-700, may be shipped from points outside of Virginia directly to a United States military or naval reservation within the geographical confines of Virginia for resale on such military or naval reservation. Such beverages and beer must be shipped to duly licensed Virginia wholesalers who may deliver the same to duly authorized instrumentalities of the United States on United States military or naval reservations within-the geographical confines of Virginia. Such beverages and beer shall be exempt from the tax only if the sale of such items meets the exemption requirements of Section 58.1-703.
*This is statutory language. No further interpretation is required.
Rulings of the Tax Commissioner