Sales and Use Tax Expenditure Study

2007 - 2011 Virginia Retail Sales and Use Tax Expenditure Study 

Pursuant to Va. Code § 58.1-609.12, the Department of Taxation was formerly charged with the responsibility of determining the fiscal, economic, and policy impact of each of the Retail Sales and Use Tax Miscellaneous Exemptions provided for by Va. Code § 58.1-609.10 and the Retail Sales and Use Tax Exemptions for Nonprofit Entities provided by Va. Code § 58.1-609.11, and reporting such findings to the chairmen of the House and Senate Finance Committees no later than Dec. 1 of each year.

Subgroups of these exemptions were reviewed annually and reports issued in accordance with a schedule determined by the Tax Commissioner. When the reports were completed for all of the subgroups, the requirement to repeat the process was repealed.

Each report includes detailed information on the policy and fiscal impacts of the exemptions addressed in the report, as well as the apparent rationale for these exemptions and their legislative history. Each report also includes a comparison of the Virginia exemptions with the sales tax structures of other states, with particular emphasis placed on a comparison with the exemptions provided in contiguous states.

There were 19 exemption categories scheduled that were studied during the 2007-2011 period, as set out below.

2007 Exemptions Analyzed

• Nonprofit Churches
• Nonprofit Entities
• Donations Withdrawn from Inventory

2007 Retail Sales & Use Tax Expenditure Study - Vol. 1, Number 1 (PDF 326 kb)

2008 Exemptions Analyzed 

• Food Stamp and WIC Voucher Purchases
• School Lunches and Textbooks

2008 Retail Sales & Use Tax Expenditure Study - Vol. 1, Number 2 (PDF 1.64 Mb)

2009 Exemptions Analyzed

• Nonprofit Entities
• Medicines and Drugs
• Hemodialysis and Peritoneal Dialysis
• Nonprescription Drugs

2009 Retail Sales & Use Tax Expenditure Study - Vol. 1, Number 3 (PDF 827 kb)

2010 Exemptions Analyzed

• Durable Medical Equipment
• Motor Vehicle Equipment for Handicapped Persons
• Communication Equipment for Handicapped Persons
• Medical Products Purchased by Medicaid Recipients
• Nonprofit Entities

2010 Retail Sales & Use Tax Expenditure Study - Vol. 1, Number 4 (PDF 1.38 Mb)

2011 Exemptions Analyzed

• Fuel Used for Domestic Consumption
• Occasional Sales
• Taxable Leases and Rentals
• Interstate Commerce
• Nuclear Power Plants
• Multifuel Heating Stoves
• Fabrication of Foodstuffs

2011 Retail Sales & Use Tax Expenditure Study - Vol. 1, Number 5 (PDF 1.38 Mb)