Tax Type
Retail Sales and Use Tax
Description
Mailing services; Printing charges
Topic
Exemptions
Taxability of Persons and Transactions
Date Issued
03-15-1989
March 15, 1989
Re. Request for Ruling/Sales and Use Tax
Dear********************
This will reply to your letter dated October 13, 1988 in which you seek a ruling on the applicability of the sales and use tax to printing charges.
FACTS
************** ("The Taxpayer") is a mail processing business located in Virginia. Customers provide the Taxpayer with printed materials for mail processing. The printed materials are printed within Virginia, delivered to the Taxpayer in Virginia, and mailed out by the Taxpayer through the U.S. Postal Service within 12 months. Some of the mailings go entirely to persons outside of Virginia; some go entirely to persons within Virginia; and some are of a national nature and go to persons within and without Virginia.
The Taxpayer requests a ruling on which materials the printer should charge sales tax to its customers and how the printer documents the tax when some or all of the printed materials are to be mailed to persons outside of Virginia. In addition, the Taxpayer wishes to know if an out-of-state printer would have any sales tax obligation if it does not have a Virginia presence.
RULING
The sale and delivery of printed materials to a customer in Virginia is generally taxable. Based on the enclosed ruling dated June 28, 1984, a customer effectively takes delivery of printed materials within this state by directing the printer to ship the printed materials to a mailhouse in Virginia for further processing and mailing. In such instances, the printer will be required to collect the sales tax on such printed materials. If the printer fails to collect sales tax, the purchaser will be required to pay Virginia use tax.
However. Va. Code §58.1-608(30) provides an exemption from the tax for certain printed materials stored in Virginia and mailed outside the state. In the case of catalogs and other printed advertising materials, the tax does not apply provided such materials are stored for twelve months or less in Virginia and mailed to or distributed outside of Virginia. For a more detailed explanation of this exemption, see the enclosed copy of VR 630-10-18.1. Additionally, from July 1, 1986 through June 30, 1990, letters, brochures, reports, and similar printed materials (except administrative supplies) are exempt from the tax, if the materials are stored for twelve months or less in Virginia and mailed or distributed outside of Virginia. Legislation has been passed by the 1989 General Assembly and is awaiting the Governor's signature to make this exemption permanent. For a more detailed explanation and list of exempt printed materials, see §8 of VR 630-1-86, copy enclosed.
Therefore, a customer would generally be liable for the tax only on the sales price of printed materials that are shipped to the Taxpayer and mailed to Virginia addresses. Any printed materials, except administrative items, distributed outside the state by the Taxpayer would be exempt under current law. A customer should provide the printer with a properly completed Form ST-10A (copy enclosed) for an exemption from the tax on items to be mailed outside of Virginia .
If you have further questions after reading this letter and the enclosed regulations, please contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner