A BILL to amend and reenact § 58.1-614, as it is currently effective and as it may become effective, of the Code of Virginia, relating to sales and use tax; sales through vending machines.
HB1362 amends Virginia’s sales and use tax rules for vending machine sales. The bill changes the tax treatment for vending machine sales of food purchased for human consumption and essential personal hygiene products, lowering the tax remittance to 1 percent of wholesale purchases beginning January 1, 2027. For those same items sold before that date, and for all other vending machine sales, the bill retains a higher remittance rate based on wholesale purchases, with a special 6.0 percent rate for dealers located in localities that impose the additional taxes under §§ 58.1-603.1 and 58.1-604.01.
The bill also preserves and restates several existing special rules for vending machine operators. It continues the exemption for operators whose machines are all under contract to nonprofit organizations, keeps the Tax Commissioner’s authority to use alternative gross-receipts-based methods when collection is impractical, and maintains the requirement that dealers keep satisfactory records and register in each locality where they have machines. The bill is drafted as an amendment to § 58.1-614, which governs vending machine sales under Virginia’s sales and use tax chapter.
In practical terms, HB1362 would reduce the tax burden on vending machine sales of groceries and hygiene products starting in 2027, while leaving the general vending machine tax framework intact. It would affect vending machine operators, wholesalers whose purchases are used to calculate the tax, and the Department of Taxation’s administration of vending machine sales tax reporting and remittance.
The available legislative history shows no recorded votes or committee debate, and the bill was left in the House Finance Committee. As a result, there is no documented floor or committee sentiment in the provided materials. Based on the text alone, the bill appears to be a targeted tax reduction for certain vending machine sales rather than a broad tax overhaul.
The main point of contention likely would be the revenue impact of lowering the tax rate on vending machine sales of food and hygiene products, versus the policy goal of reducing costs for consumers and operators. Another possible issue is the complexity of maintaining different tax rates depending on product type, date of sale, and locality-specific taxes, which could affect compliance and administration.
HB1362 would amend § 58.1-614 of the Code of Virginia, changing the sales and use tax remittance rules for vending machine sales. It would create a reduced 1 percent tax treatment for vending machine sales of food purchased for human consumption and essential personal hygiene products beginning January 1, 2027, while preserving higher rates for earlier sales and for other vending machine items. The bill would continue to govern how dealers report wholesale purchases, how local sales tax is remitted, and when alternative gross-receipts methods may be used.
There is no recorded committee transcript or vote history in the provided materials, so no direct sentiment from legislators or stakeholders is available. The bill’s structure suggests a policy preference for lowering taxes on basic consumer goods sold through vending machines, but the fact that it was left in Finance indicates it did not advance in the committee process. Overall, the available record is neutral to limited, with no documented support or opposition statements.
The likely areas of contention are fiscal and administrative. Supporters would likely favor the reduced tax rate on food and hygiene products as a consumer-relief or small-business measure, while opponents may raise concerns about lost revenue to the state and localities. There may also be debate over the complexity of applying different rates by product category, effective date, and locality-specific tax regime, as well as the continued reliance on Tax Commissioner determinations for impractical collection situations.