PVCC-cifp wrote:I know for a fact the language doesn't go back that far. I participated in sales tax audits in both 2011 and 2016 right before the presidential elections and at that time the sales tax in Virginian was definitely imposed on the consumer not the seller.
I think you're wrong on two out of three of those statements. I'm sure you did participate in sales tax audits back then, but the language was already in its current form at the time, and it was already decided that the language unambiguously imposed sales tax on the seller and not the buyer.
In support of my position I offer the following excerpts (with emphasis added) from
Hardaway Construction v. Department of Taxation (Case No. LR1165-1, Circuit Court City of Richmond, July 8, 2005):
The Commonwealth characterizes Mellot's operations as fabrication. However, fabrication does not implicate the use tax. Fabrication only implicates imposition of the sales tax. Under Va. Code § 58.1-602 a "sale" includes the service of "fabrication." The sales tax statute provides in pertinent part:
§ 58.1-604. Imposition of sales tax.
There is hereby levied and imposed, in addition to all other taxes and fees of every kind now imposed by law, a license or privilege tax upon every person who engages in the business of selling at retail or distributing tangible personal property in this Commonwealth,. . .:
The Commonwealth suggests that the use tax compliments the sales tax and that if fabrication applies to the sales tax then, by inference, it must also apply to the use tax. The court agrees that the use tax may compliment the sales tax, but they are not coextensive. The sales tax cannot be imposed on the purchaser only the seller. The use tax exists to fill the void in the Commonwealth's ability to assess sales tax against purchasers by granting the right to assess purchasers directly. However, the use tax against purchasers is limited to purchases of tangible property. The fundamental distinction applying here is that the use tax does not extend to services. Even if crushing shot rock were fabrication subject to sales tax, the sales tax is levied against the seller, not the purchaser. While the seller has the ability to collect the sales tax from the purchaser, the Commonwealth has no right to collect the tax directly from the purchaser, only the seller.
I'm curious to know how this misunderstanding arose. Was it something about how the 2011 and 2016 audits were conducted? Could there have been some confusion about when a use tax was being collected from the purchaser vs. when a sales tax was being collected from the seller?