Tax Type
Retail Sales and Use Tax
Description
Special permission to include sales tax in the price of item
Topic
Collection of Tax
Returns/Payments/Records
Date Issued
06-29-1984
June 29, 1984
Re: Ruling Request: Sales and Use Tax
Dear ********************
This will reply to your letter of May 7, 1984 concerning permission for ***** (the "Company") to alter its sales tax pricing system.
Facts
By permission granted July 25, 1980 and confirmed July 12, 1982, the Company was authorized to use a sales tax included pricing system for its food concessions because of a penny shortage. The shortage is now much less severe and the Company proposes to return to the usual system of separately stating and collecting sales tax at its permanent concessions as of May 15, 1984.
The Company also has "traveling vendors" who make sales from locations with no cash registers or similar equipment. The Company states that it is impractical to collect sales tax in the usual manner at these locations and seeks permission to remit sales tax based on a percentage of gross receipts which takes into account the inclusion of the sales tax. The locations would have notices posted advising consumers that all prices include sales tax.
Determination
Based on the information presented, the Company is granted permission to return to the usual system of separately stating and collecting sales tax at its permanent concessions as of May 15, 1984.
The Company is also granted permission, under the conditions set forth below, to include the sales tax in the price of items sold by "traveling vendors" from locations with no cash registers or similar equipment. Permission is contingent upon the Company's providing a breakdown of prices indicating the base price of each item and the amount of tax included, which would be available to consumers upon request, and posting notices at the locations advising consumers that all prices include sales tax. The tax liability of the Company for these locations will be computed by dividing total receipts for these locations, including the sales tax, by 1.04 to arrive at the amount on which the tax for these locations must be computed.
This ruling does not in any way set a precedent for the collection and payment of Virginia sales tax and is applicable only to the situation as described herein. Any change in the factual situation of the Company shall invalidate this ruling.
Sincerely,
W. H. Forst
State Tax Commissioner
Rulings of the Tax Commissioner