Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 28, 1994 TAG: 9407300032
SECTION: BUSINESS PAGE: B10 EDITION: METRO
SOURCE: MELISSA CURTIS STAFF WRITER
DATELINE: LENGTH: Medium
A week and a half ago, Quibell was notified by the Virginia Department of Taxation that it had to pay back taxes on the 25 truckloads of bottled water that were donated to the disaster-stricken area surrounding the Mississippi River.
"It's a relief effort, and the state of Virginia wants us to charge taxes," said Jeanne Staley, Quibell's director of administration and sales. "That the state would tax a nonprofit event, it doesn't seem right."
Virginia law stipulates that any product that leaves a company's inventory is taxable, unless a tax-exemption form is on file at the company. Staley said Quibell did not know about the law and did not charge taxes when it donated the truckloads of water.
Quibell also participated in a relief effort conducted by Roanoke television station WSLS and NationsBank, which set up a fund for individuals to donate relief money.
The money was used to purchase water from Quibell, which Staley said was sold below cost at $5 a case. Quibell then shipped an additional 20-25 loads of water to disaster areas. Staley said Quibell absorbed all transportation costs.
But no taxes were paid to the state on any of the water, and now Quibell may have to pay that tax.
It is not the money Quibell has a problem with; it's the law, and Staley said Quibell is going to fight it.
"The money is nothing; it's the issue," she said. "It's a law in place that needs to be changed."
Staley said she thinks people will stop donating money during relief efforts if they will be taxed for it. "If it happens again, we're going to have to charge sales tax."
Quibell previously has donated water to victims of hurricanes and currently is helping relief efforts from floods in Georgia.
"If the state is going to take money away for helping others, [people] are going to say, `No way,''' she said. "No one will want to help. No one will want to contribute."
Memo: ***CORRECTION***