96-166

Response November 6, 1996

 

 

Request

XXXXX

 

September 10, 1996

 

Utah State Tax Commission

ATTN: XXXXX

210 N 1950 W

Salt Lake City, UT 84134

 

Subject: Proposed Rule R865-19S-23. Exemption Certificates.

 

Dear XXXXX:

 

Realizing that the period for comments to the above matter has been closed, I would request clarification on the following: In those incidences where a proper form 721 was not acquired, yet the sale is clearly exempt, must we be sure that the purchasing entity is licenced?

 

The Tax Bulletin 6-96 indicates on page 2 under Changes to Sales Tax Exemption Certificates that the Commission will issue license numbers to state and local government entities and they are to provide this number to a vendor on the new exemption certificate. The proposed rule indicates that the vendor may retain a copy of the purchase order, check, or voucher in place of the certificate as evidence of exemption, but does not indicate that the documentation is to reference the licence number or even to ask if they are licenced pursuant to the bulletin. This then lends to the question if the Commission has changed its position on issuing the licenses?

 

thank you for your help in clarifying this issue.

 

Respectfully,

 

XXXXX

 

November 6, 1996

 

XXXXX

 

Advisory opinion - Exemption certificates.

 

Dear XXXXX

 

We have received your inquiry concerning exemption numbers issued to state and local govern ment entities. If an state or local entity issues a vendor an exemption certificate, it must include the entity’s exemption number. We also accept, as an alternative to the exemption certificate, a copy of the check issued on the entity’s account or a voucher or purchase order issued by the entity on its own form. The exemption number is not required on these alternative forms.

 

The purpose of any of these documents is to verify to the vendor that payment is made directly by the tax exempt entity. You may accept any of these forms as evidence of exempt status. Retain a copy of the check, purchase order or voucher in your tax record just as you would retain an exemption certificate.

 

For the Commission,

Joe B. Pacheco,

Commissioner