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Virginia has amended its tax code regarding the nexus requirements for out-of-state businesses to collect and remit sales tax in the state. Effective July 1, 2017, the definition of dealer has been modified to include owning tangible personal property for sale that is located in the Commonwealth of Virginia.  This activity will create sufficient nexus to require out-of-state businesses to collect and remit Virginia sales tax on sales to customers in Virginia. (Ch. 51 (H.B. 2058), Laws 2017, effective July 1, 2017


Virginia has enacted legislation that extends the sunset date for the state’s annual sales tax holiday for school supplies and clothing, Energy Star and WaterSense products and hurricane preparedness items from July 1, 2017 to July 1, 2022. For more information on Virginia’s sales tax holiday, visit our Sales Tax Holiday chart (Ch. 26 (H.B. 1529), Laws 2017, effective July 1, 2017)


Virginia has enacted legislation that authorizes a tax amnesty program to take place during the period July 1, 2017 through June 30, 2018 and lasting 60-75 days. The exact dates of the program are to be determined. Under the amnesty program, civil or criminal penalties and 50% of the interest assessed or assessable which are the result of nonpayment, underpayment, nonreporting, or underreporting of tax liabilities will be waived upon receipt of the payment of tax and interest owed. The program is applicable to any tax administered or collected by the Virginia Department of Taxation. Certain restrictions apply on who will be able to participate in the tax amnesty program. (Ch. 54 (H.B. 2246), Laws 2017, effective July 1, 2017)


UPDATE: Virginia has announced the dates for this amnesty program. The amnesty program will take place from September 13 through November 14, 2017. Virginia Tax sent letters to the last known address of eligible taxpayers detailing which bills and delinquent tax returns qualify for amnesty. If individuals did not receive a letter but know they have unpaid bills or delinquent tax returns, they may still qualify for the amnesty program. To take advantage of the program, taxpayers must pay 100% of the amnesty amount due for each delinquent tax period and file any required returns during the amnesty dates. In order to qualify, tax bills must be related to an amnesty eligible period and have an assessment date on or before June 15, 2017, while returns must be applicable to an eligible period. The periods eligible for amnesty vary by tax type and can be viewed here. For registered taxpayers, all periods open under the statute of limitations are included.  For unregistered participants, there is no limit to the look back period.  All taxes since nexus was created should be remitted.  For any tax liability that was eligible for amnesty benefits but remains unpaid (including audit assessments covering amnesty periods), a 20% penalty will apply.  This penalty is in addition to all other penalties.  For more information, visit the Virginia Tax webpage.


Virginia Governor Terry McAuliffe has signed the biennial budget bill which contains a provision regarding the sales and use tax exemption for internet services. For purchases made on or after July 1, 2006, any sales and use tax exemption applicable to production, distribution, and other equipment used to provide internet access services by internet service providers must be claimed as a refund request to the Tax Commissioner. (Ch. 780 (H.B. 30), Laws 2016, effective July 1, 2016, except as noted)


Effective July 1, 2016, Virginia’s sales and use tax exemption for tangible personal property purchased or leased for use or consumption directly and exclusively in basic research or research and development in the experimental or laboratory sensehas been expanded and will apply to property used in a federally funded research and development center, regardless of whether the property is used by the purchaser, lessee, or another person or entity.(Ch. 780 (H.B. 30), Laws 2016, effective July 1, 2016)



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