Current through Register Vol. 41, No. 3, September 23, 2024
A. The gross
receipts of a wholesaler or distribution house subject to the tax based on
purchases are attributed to the definite place of business from where the goods
are physically delivered to customers or at the shipping point to customers.
Examples:
1. A wholesaler has its sales office
in Town B and maintains a warehouse in County C from which it ships goods by
truck to customers in Virginia. Wholesaler is subject to license tax measured
by purchases. Wholesaler's warehouse is a definite place of business subject to
taxation in County C.
2. A
wholesaler has facilities in North Carolina and has a distribution center in A
Town A, Virginia, which assesses a BPOL tax on wholesalers based upon
purchases. Merchandise shipped from the wholesaler in Town A is subject to the
license tax measured by purchases and the situs of the wholesaler's purchases,
of goods shipped from Town A is Town A because it is the shipping point from
the distribution center.
3. A
wholesaler, whose BPOL tax is measured based upon purchases, has a warehouse in
County A from where it delivers goods to customers. The situs of its purchases
is County A.
4. Company A
manufactures equipment for industrial, governmental and commercial use at its
plant outside Virginia. It has an office in City B, Virginia, where sales
solicitations take place. Company A's sales office is taxable as a wholesale
merchant based on purchases. The purchases of a wholesaler subject to the tax
on purchases are attributed to the definite place of business where the goods
are physically delivered to customers or at the shipping point to customers.
Company A has no taxable purchases in City B since the goods are not delivered
or shipped from the sales office in that locality.
5. Company A sells petroleum products at
retail in its own retail stores. It also sells petroleum products at wholesale
to retail dealers at City A in Virginia. Company A exchanges a shipload of
petroleum products for a shipload of oil with Company A. The exchange occurs
outside of Virginia. The exchange is not taxable. The sale is not a retail sale
nor attributable to the exercise of the privilege of selling at retail at
Company A's retail stores. There is no purchase at any place of business in
Virginia that is subject to a wholesale merchant's tax in Virginia because
delivery occurred outside Virginia.
B. "Purchases" means all goods, wares and
merchandise received for sale at each definite place of business of a wholesale
merchant. The term shall also include the cost of manufacture of all goods,
wares and merchandise manufactured by any wholesale merchant and sold or
offered for sale. A wholesale merchant may elect to report the gross receipts
from the sale of manufactured goods, wares and merchandise if it cannot
determine the cost of manufacture or chooses not to disclose the cost of
manufacture.
C. Some localities are
grandfathered to assess a BPOL tax upon wholesalers based upon gross receipts.
Any wholesaler who is subject to a BPOL tax in two or more localities with
different bases or measures may apply to the Tax Commissioner for the proper
measure of purchases and gross receipts subject to tax in each
locality.
§ 58.1-3701 of the Code of
Virginia.
