Tax Type
Retail Sales and Use Tax
Description
Financial aid solicitor for student athletes
Topic
Taxability of Persons and Transactions
Date Issued
11-07-1989
November 7, 1989
Re: Request for Ruling/Sales and Use Tax
Dear***********
This will reply to your letter of October 10, 1989 requesting a ruling as to the sales and use tax exemption status of**************
FACTS
********** (the Taxpayer) is a nonprofit corporation devoted to raising financial aid for qualified University of Virginia student-athletes. In addition, it is committed to improving the quality of athletics at the University of Virginia. Membership is open to all alumni and friends who wish to contribute to the Foundation. All contributions are applied to scholarships for student-athletes and all grants must be approved by the University's Committee on Scholarships, Loans, and Employment. The Taxpayer is seeking an exemption in order to purchase items exempt of the Virginia retail sales and use tax.
RULING
There is no general exemption from the Virginia retail sales and use tax for nonprofit organizations (see §630-10-74 of the Virginia Retail Sales and Use Tax Regulations). The only exemptions from the tax are set out in Virginia Code §58.1-608 (copy enclosed). §58.1-608(4)(b) of the Code provides an exemption for schools and other institutions of learning. The fact that the Taxpayer is affiliated with the University of Virginia does not automatically exempt them from the sales and use tax. §630-10-96 of the Virginia Retail Sales and Use Tax Regulations deals with schools and colleges and states, in part, "the tax does apply to sales to independent athletic and other such associations, whether or not affiliated with a nonprofit institution of learning (including state institutions)." While I am mindful of the worthwhile purpose that the Taxpayer serves, absent a statutory exemption that would allow the Taxpayer to make purchases exempt from the tax, the department has no authority to grant such an exemption.
Therefore, the Taxpayer is required to pay the tax to the retailer on all purchases of tangible personal property if the retailer is registered to collect the tax. If the retailer is not registered to collect the tax, the Taxpayer must report and pay the use tax on a Consumer Use Tax Return, Form ST-7.
If I can be of further assistance, please contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner