Tax Type
Retail Sales and Use Tax
Description
Exemption certificates
Topic
Taxability of Persons and Transactions
Date Issued
06-19-1985
June 19, 1985
RE: §58.1-1821 Application/Sales and Use Tax
Dear ****
This will reply to your letter of May 6, 1985, in which you file an application for correction of sales and use tax assessed to ***** as the result of a previous audit.
The assessment resulting from the department's audit of ***** ("Taxpayer") was based upon the taxpayer's failure to collect the sales tax from customers. Subsequent to the department's audit, the taxpayer was permitted to obtain certificates of exemption from customers entitled to lease films exclusive of the tax. Transactions for which proper certificates of exemption were obtained were then removed from the department's audit.
Your present application questions the department's failure to remove transactions involving six customers from its audit. I agree that transactions involving the ***** and the ***** should be removed from the department's audit. The former is an agency of the ***** County government and the latter is public institution of learning, each exempt from the tax when they provide vendors with certificates of exemption. As such certificates have been provided in this case, revisions will be made immediately. While there is some question as whether the organization actually used public funds to rent films from the taxpayer, rentals to the ***** will also be removed from the department's audit inasmuch as the organization provided an exemption certificate to the taxpayer. Rentals to the ***** will not be removed from the audit, however, inasmuch as the exemption certificate provided by you for that organization does not bear the organization's name.
In addition, I find no basis for the removal of transactions from the audit involving the ***** and the *****. You were advised in my determination of May 8, 1984, that the**** entitled to exemption under the sales and use tax; consequently, I cannot accept the exemption certificate provided. As to the rental to the ***** it is my understanding that delivery of the film occurred in Virginia and absent an exemption certificate from the church, the transaction must remain in the audit.
The assessment issued to the taxpayer will be revised based upon the foregoing and a revised notice of assessment will be issued shortly.
Sincerely
W. H. Forst
Tax Commissioner
RE: §58.1-1821 Application/Sales and Use Tax
Dear ****
This will reply to your letter of May 6, 1985, in which you file an application for correction of sales and use tax assessed to ***** as the result of a previous audit.
The assessment resulting from the department's audit of ***** ("Taxpayer") was based upon the taxpayer's failure to collect the sales tax from customers. Subsequent to the department's audit, the taxpayer was permitted to obtain certificates of exemption from customers entitled to lease films exclusive of the tax. Transactions for which proper certificates of exemption were obtained were then removed from the department's audit.
Your present application questions the department's failure to remove transactions involving six customers from its audit. I agree that transactions involving the ***** and the ***** should be removed from the department's audit. The former is an agency of the ***** County government and the latter is public institution of learning, each exempt from the tax when they provide vendors with certificates of exemption. As such certificates have been provided in this case, revisions will be made immediately. While there is some question as whether the organization actually used public funds to rent films from the taxpayer, rentals to the ***** will also be removed from the department's audit inasmuch as the organization provided an exemption certificate to the taxpayer. Rentals to the ***** will not be removed from the audit, however, inasmuch as the exemption certificate provided by you for that organization does not bear the organization's name.
In addition, I find no basis for the removal of transactions from the audit involving the ***** and the *****. You were advised in my determination of May 8, 1984, that the**** entitled to exemption under the sales and use tax; consequently, I cannot accept the exemption certificate provided. As to the rental to the ***** it is my understanding that delivery of the film occurred in Virginia and absent an exemption certificate from the church, the transaction must remain in the audit.
The assessment issued to the taxpayer will be revised based upon the foregoing and a revised notice of assessment will be issued shortly.
Sincerely
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner