Dear Ace: I’m confused about the sales tax law. I bought some over-the-counter laxatives today at Wal-Mart and was surprised when they charged me 5 percent sales tax. I thought over-the-counter-drugs weren’t supposed to be taxed. What gives?—Constipated and Confused
Dear Confused: Sorry to hear about your, er, problem. But your question does raise an important issue for other regular—hehehe—consumers in the state of Virginia. All of us, especially Ace since he spends a small fortune on muscle-boosting creatine monohydrate protein powder during the course of the year, wants to know: Is there sales tax on over-the-counter-drugs?
Wal-Mart seems to say yes, while Timberlake’s Drug Store says no. When Ace contacted John Plantz, the pharmacist at Timberlake’s, to find out about the taxable status of over-the-counter-goods, Plantz said, “There are all kinds of goods that are exempt from sales tax. Basically, any medicine that you swallow, except for vitamins, is exempt from sales tax. First aid items and liniments are also exempt.”
Are we to believe the retail giant or the small hometown pharmacy? Not wanting to get caught up in that whole anti-globalization debate (at least not in this installment), Ace decided to settle the dispute as any prudent, wise judge would—by consulting the very dense, very dull Tax Code of Virginia. According to the code, since July 1, 1998, all nonprescription drugs and proprietary medicines have been exempt from the retail sales and use tax. As the law is written, cold medicine, eye drops, antacids, cod liver oil, hydrogen peroxide and, yes, laxatives fall into the category of tax-exempt OTC medications, whereas cosmetics, toilet articles, food products and supplements, vitamins and nonprescription birth-control devices do not fall under the exemption.
Since you’ve been done dirty by The Man, Confused, you might be wondering about recourse. To right any and all of your tax wrongs, contact the Virginia Department of Taxation at 804-367-8037. The Department of Taxation will then contact the retail establishment, at which point, hopefully (this is a bureaucratic office, after all) you will have your money refunded.