A taxpayer’s purchases of items used in its waste collection and disposal services – including residential bins, front-end load bins, trucks, and related equipment – do not qualify for the Virginia industrial manufacturing and processing sales tax exemption. The taxpayer’s waste collection and disposal services do not qualify as industrial manufacturing or processing activities. As the provider of a waste disposal service to customers, the taxpayer is the taxable user and consumer of all tangible personal property used in providing the services and is required to pay sales tax on its purchases. The taxpayer is subject to tax on residential bins purchased for use by residential customers and the front-end load bins purchased for use by commercial customers. Trucks and related equipment used to collect and transport residential and commercial waste are also subject to tax. If a vendor does not charge and collect the sales or use tax on purchases used for waste collection and transportation, the taxpayer must remit consumer use tax on the purchases. The taxpayer’s recycling operation also does not qualify for the industrial manufacturing or processing exemption. It didn’t appear that the recycled materials undergo any type of treatment to make the product more marketable for the taxpayer or useful for the customer. The grade or category of paper or metal that goes into the recycling process is the same grade of paper or metal that is baled and ready for sale. As a result, the recycling operation does not qualify for the exemption.If the taxpayer can provide additional information demonstrating that the recycled material undergoes some process that makes it more marketable for the taxpayer or useful to the customer, the issue will be revisited.(Ruling of Commissioner, P.D. 14-153, Virginia Department of Taxation, August 28, 2014)