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Federal contractors in Virginia may get relief from sales taxes.

Federal contractors in Virginia may get relief from sales taxes on some of their contracts.

The state's new governor, Democrat Tim Kaine, will ask the legislature to stop taxing goods that are sold to the government on contracts primarily for services, The Washington Post reported.

Under terms of the governor's proposed budget, state tax collectors would examine each task order on a contract to determine whether the "true object" is to provide services rather than goods. If so, goods sold as part of the contract would not be subject to sales tax.
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Title Annotation:Washington Insider
Publication:Set-Aside Alert
Date:Jan 27, 2006
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