Administrative Code

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Virginia Administrative Code
Title 23. Taxation
Agency 10. Department of Taxation
Chapter 210. Retail Sales and Use Tax

23VAC10-210-340. Collection of tax by dealers.

A. Generally. The tax must be paid to the state by the dealer, but the dealer must separately state the amount of the tax and add the tax to the sales price or charge. Thereafter, the tax is a debt from the purchaser, consumer or lessee to the dealer until paid and is recoverable at law in the same manner as other debts.

Identification of the tax by a separate writing or symbol is not required provided the amount of the tax is shown as a separate item on the record of the transaction. For special rules relating to vending machines sales, see 23VAC10-210-6040 through 23VAC10-210-6043.

B. Advertising absorption of tax by dealers. It is a misdemeanor for a dealer to advertise or hold out to the public in any manner, directly or indirectly, that he will absorb all or any part of the sales or use tax, or that he will relieve the purchaser, consumer or lessee of the payment of all or any part of the tax, except as may be authorized under the bracket system or the special provisions relating to vending machine sales. This prohibition does not apply during the sales tax holiday provided under §§ 58.1-609.1, 58.1-611.2, and 58.1-611.3 of the Code of Virginia, nor for the 14 days immediately preceding the commencement of the sales tax holiday. During this 17-day period, dealers may advertise that they will absorb the tax on any or all nonqualifying items. The dealer may not absorb the tax prior to or following the sales tax holiday period and may not advertise that he will do so.

C. Erroneous collection of tax on nontaxable transactions. All sales and use tax collected by a dealer is held in trust for the state. Therefore, any dealer collecting the sales or use tax on nontaxable transactions must remit to the Department of Taxation such erroneously or illegally collected tax unless he can show that the tax has been refunded to the purchaser or credited to the purchaser's account.

D. Overcollection of the tax. Any dealer who collects tax in excess of a 5.3% (6.0% in the Hampton Roads and Northern Virginia Regions) rate or who otherwise overcollects the tax, except as may be authorized under the bracket system or the special provisions relating to vending machine sales, must remit any amount overcollected to the state on a timely basis. Failure to do so will result in a penalty of 25% of the amount of the overcollection. For definitions of the "Hampton Roads Region" and the "Northern Virginia Region" see 23VAC10-210-2070.

Statutory Authority

§ 58.1-203 of the Code of Virginia.

Historical Notes

Derived from VR630-10-24; revised January 1, 1979; amended, eff. January 1, 1985; Volume 32, Issue 22, eff. September 12, 2016.

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