Tax Type
Retail Sales and Use Tax
Description
Nonprofit selling educational video tapes; Collection of tax
Topic
Collection of Tax
Exemptions
Date Issued
11-06-1990
November 6, 1990
Re: Request for Ruling: Sales and Use Tax
Dear*************
This will reply to your letter of August 29, 1990 in which you requested a ruling as to whether the ***********(the Taxpayer) qualifies for an exemption under Va. Code §58.1-608 from the sales and use tax on educational materials offered for sale.
FACTS
The Taxpayer, a nonprofit organization, is organized to promote statewide cooperation between individuals and groups concerned with improving health and medical care in Virginia. The Taxpayer is seeking a ruling as to whether or not it should collect sales and use tax upon sales of audio cassette tapes and educational video tapes.
RULING
Va. Code §58.1-603 imposes the sales tax "upon every person who engages in the business of selling at retail or distributing tangible personal property in the Commonwealth..." The term "sale at retail" is defined in Va. Code §58.1-602 to mean "a sale to any person for any purpose other than for resale..."
However, Va. Code §58.1-608 (10)(b) exempts from sales and use tax occasional sales of tangible personal property. Explaining §58.1-608(10)(b), VR 630-10-75 provides that:
-
- The tax does not apply to an occasional sale provided the sale or exchange is not one of a series of sales or exchanges sufficient in number, scope, and character to constitute an activity requiring the holding of a certificate of registration.... The term "occasional sale" means ...[a] sale by a person who is engaged in sales on three or fewer separate occasions within a one calendar year...
Applying the facts in this case to the statute and regulation cited above, your organization would not qualify for the occasional sale exemption because the sale of audio cassette tapes and educational video tapes are available all during the year through the mail and at each conference.
Based on the above, I find no basis in this case for waiving the requirement that the sales tax be collected. The sales tax must be collected on all audio cassette and educational video tapes offered for sale by the Taxpayer.
If you should have any further questions, please contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner