Tax Type
Retail Sales and Use Tax
Description
Production and sales of records and tapes
Topic
Collection of Tax
Exemptions
Taxability of Persons and Transactions
Date Issued
11-03-1986
November 3, 1986
Re: §58.1-1821 Application/Sales and Use Tax
Dear **********************
This will refer to your letter of August 13, 1986 to Secretary of Finance Stuart W. Connock, in which you submit information relating to a previous sales and use tax audit of ************* Secretary Connock has asked that the department consider your letter as a continuation of your client's earlier appeal under §58.1-1821 of the Code of Virginia.
After once again reviewing this matter, I find basis for the waiver of all sales and use tax assessments outstanding against your client and the removal of the memorandums of lien placed against your client's property. This action is taken due to the conflicting information received by your client on the taxability of recording studio charges. For the future, however, your client will be expected to follow the guidelines set forth in my July 18 1983 letter, a copy of which is enclosed.
As specifically noted in my July 18, 1983 letter, your client should collect and remit the tax on the total charge for the production and sale of records and master tapes, unless he takes from his customer a valid certificate of exemption. On the other hand, your client may purchase exempt from the tax those items that will be resold to customers, such as blank tapes. posters, album covers, etc. If you or your client have any questions in this regard, please do not hesitate to contact the department for guidance.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner