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Virginia Tax Commissioner Grants Sales Tax Exemption for Pharmaceutical Development Company’s Clean Room Purchases

May 11, 2022, 5:00 AM

The Virginia Tax Commissioner Feb. 15 determined in a letter ruling that Taxpayer was entitled to a sales and use tax exemption. The Department of Taxation assessed use tax on Taxpayer’s purchases of materials for constructing a clean room within a leased research facility, finding that the room became part of the real property upon completion. Taxpayer appealed. The commissioner noted: 1) Taxpayer used c-channels bolted to the building’s concrete interior floor to attach the room’s pre-fabricated exterior walls; 2) Taxpayer’s lease agreement required it to return the real property to the landlord in the same condition as at the ...