DISCUSSION: By the terms of certain treaties and conventions, some foreign diplomatic and consular personnel are exempt from many federal, state and local taxes.

Effective February 15, 1986, the United States Department of State began issuing an official photo identification card as evidence that a particular diplomat or diplomatic mission is exempt from the taxes imposed by G.L. cc. 64G (rooms) and 64H (sales, including sales of meals). The cards will state that the bearer is exempt from:

(1) all sales taxes including room occupancy taxes;
(2) all sales taxes excluding room occupancy taxes; or
(3) all sales taxes on purchases totaling over a specific amount, i.e., $50., $100., $150., or $200.

The United States Department of State has informed DOR that the exemption under (3), above applies to the entire transaction when the total of purchases exceeds the minimum amount, i.e., if a card applies to purchases above $50.00 and the purchases in a single transaction total $50.01, there is no sales tax whatsoever imposed. The card minimum must be exceeded, however, or the entire transaction is subject to tax.

The Department of State has also informed DOR that the exemption under (3) is intended to include an exemption from the room occupancy excise. Therefore, unless a diplomatic identification card specifically states that the bearer is not exempt from the rooms excise, no rooms excise may be imposed.

DIRECTIVE: Beginning June 1, 1988, diplomats must present the official Department of State card to receive an exemption from the sales or rooms tax. Massachusetts vendors may no longer accept the former "Diplomatic and Consular Exemptions" Letter as proof that a purchaser is exempt from these taxes.

For procedures that a vendor must follow to prove that a transaction was properly exempted from a tax, see Administrative Procedures, AP 621.3.1.

For more information, write to: Office of Foreign Missions, U.S. Department of State, Room 2442, Washington, D.C. 20520, or call or write the Department of Revenue's Determination Bureau at 100 Cambridge Street, Room 300, Boston, MA 02204 (617) 727-0135.

REFERENCE: G.L. c. 64G; G.L. c. 64H; AP 621.3.1

/s/Stephen W. Kidder
Stephen W. Kidder
Commissioner of Revenue

June 1, 1988

DD 88-3

This Directive represents the official position of the Department of Revenue on the application of the law to the facts as stated. The Department and its personnel will follow this Directive, and taxpayers may rely upon it, unless it is revoked or modified pursuant to 830 CMR 62C.01(5)(e). In applying this Directive, however, the effect of subsequent legislation, regulations, court decisions, Directives, and TIRs must be considered, and Department personnel and taxpayers may rely upon this Directive only if the facts, circumstances and issues presented in other cases are substantially the same as those set forth in this Directive.