Tax Type
Retail Sales and Use Tax
Description
Nonprofit; disabled individuals; Exemption criteria
Topic
Exemptions
Property Subject to Tax
Date Issued
02-04-1991
February 4, 1991
Re: Request for Ruling: Sales and Use Tax
Dear*****************
This will reply to your letter of January 3, 1991 in which you request a ruling as to whether your organization, the*************** (the "Taxpayer"), qualifies for exemption from the retail sales and use tax.
FACTS
The Taxpayer, a private nonprofit organization exempt from income taxation under Internal Revenue Code §501(c)(3), is organized to advocate, plan and develop programs and services that aid individuals with disabilities in reaching maximum person independence. Its programs are nonresidential. The Taxpayer is funded primarily from a state grant administered by the Department of Rehabilitative Services, yet receives limited funding from donations, private grants and fees for services.
You are seeking exemption from the retail sales and use tax.
RULING
There is no general exemption from the Virginia retail sales and use tax for nonprofit organizations. The only exemptions from the tax are set out in Va. Code § 58.1-608 (copy enclosed). 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