Tax Type
Retail Sales and Use Tax
Description
Cable TV hand-held remote control units
Topic
Property Subject to Tax
Date Issued
03-20-1990
March 20, 1990
Re: §58.1-1821 Application/ Sales and Use Tax
Dear ****
This will reply to your May 26, 1989 letter on behalf of your client requesting reconsideration of my April 28, 1989, July 29, 1988 and September 15, 1987 determinations in the above referenced case.
My previous determinations concluded that your client ("the Taxpayer"), an operator of several local cable television systems, is subject to the use tax on its purchases of hand-held remote control units as such units do not qualify for exemption as amplification, transmission or distribution equipment used by cable television systems. Additionally, the department ruled that the remotes are not accessory equipment used by the cablevision company to transmit or distribute cable signals within the meaning of Virginia Code §58.1-608(6)(b) and Virginia Regulation (VR) 630-10-88. The Taxpayer continues to assert that the remotes are exempt "accessories" under VR 630-10-88.
I have reviewed my prior determinations issued to the Taxpayer in light of your most recent comments and do not find basis to revise my original determination. VR 630-10-88 interprets and cannot be inconsistent with Virginia Code §58.1-608(6)(b) which provides an exemption from the sales and use tax for "...amplification, transmission, and distribution equipment used or to be used by cable television systems." (Emphasis added). The department's position remains that any applicable accessory must therefore play a role in amplification, transmission or distribution in order to qualify for the exemption provided by the statute and regulation cited above. Inasmuch as the sole purpose of the hand-held remote control units in question is to permit subscribers to change channels more conveniently rather than to amplify, transmit or distribute cable signals, such units do not qualify for exemption.
Therefore, I continue to find no basis for a correction of the assessment.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner