New Foreign Diplomat Tax Exemption Card Design!
Sales of tangible personal property; items, property, and goods under sec. 77.52(1)(b) to (d), Wis. Stats. (2009-10); and taxable services to certain foreign officials are exempt from Wisconsin sales or use tax, as provided by federal law. Not all foreign officials are entitled to tax exemption, because this privilege is based on reciprocity the Department of State has with other foreign missions. The Department of State, Office of Foreign Missions, issues a Diplomatic Tax Exemption Card to qualifying foreign officials.
For identification purposes, the official's name, photograph, mission employed by, expiration date, and protocol identification number were provided on the cards that were previously issued. These previously issued cards indicated the level of tax exemption by the color of the card and the written explanation in the colored box. Cards with a blue stripe exempted the bearer from all state and local taxes nationwide, while cards with other color stripes (e.g., red, yellow, green) had certain restrictions.
Note added April 8, 2013: Diplomatic Tax Exemption Cards MAY NOT be used to claim exemption from Wisconsin sales and use tax on purchases, leases, or rentals of motor vehicles. For this purpose, "motor vehicles" includes, but is not limited to, automobiles, motorcycles, boats, and aircraft.
Special rules apply in the case of motor vehicles, and require a tax exemption letter from the U.S. Department of State, Office of Foreign Missions.
Additional information is available in an article titled "Exempt Sales of Motor Vehicles to Foreign Missions," in Wisconsin Tax Bulletin #178 on page 6, and at the Office of Foreign Mission's website.
The Department of State will begin issuing newly designed Diplomatic Tax Exemption Cards in the near future. The new cards will no longer use the "blue/yellow stripe" feature.
The new cards will incorporate state of the art security features to defeat attempts to fraudulently manufacture counterfeit cards. One of these new features is the use of animal images, rather than the current "blue/yellow stripes," to convey an immediate visual cue of the level of exemption the cardholder is authorized to receive. These animals (owl, eagle, buffalo, and deer) will convey the following general information concerning the level of tax exemption authorized by a particular Diplomatic Tax Exemption Card:
- Owl - This image will signify that such cards are intended to be used solely in connection with official purchases and that the cardholder/mission is eligible for exemption from sales, occupancy, restaurant/meal, and other taxes without restriction.
- Buffalo - This image will signify that such cards are intended to be used solely in connection with official purchases and that the cardholder/mission's eligibility for exemption from sales, occupancy, restaurant/meal, and other taxes is subject to some degree of restriction. For example, such cards may read " EXEMPT FROM TAX ON PURCHASES OVER $300; NOT VALID AT HOTELS."
- Eagle - This image will signify that such cards are intended to be used solely in connection with personal purchases and that the cardholder is eligible for exemption from sales, occupancy, restaurant/meal, and other taxes without restriction.
- Deer - This image will signify that such cards are intended to be used solely in connection with personal purchase and that the cardholder's eligibility for exemption from sales, occupancy, restaurant/meal, and other similar taxes is subject to some degree of restriction. For example, such cards may read " EXEMPT FROM TAX ON PURCHASES OVER $150; NOT EXEMPT FOR HOTELS, RESTAURANTS, & SERVICES."
All existing Diplomatic Tax Exemption Cards will be replaced with the newly designed cards no later than August 31, 2011. Vendors may continue to accept cards with the old design until that date.
The following is an image of a Diplomatic Tax Exemption Card with the image of an eagle, which exempts the bearer from all state and local taxes on personal purchases, without restriction:
The following is an image of the back of a Diplomatic Tax Exemption Card, which exempts the bearer from certain state and local taxes that identifies the restrictions on the back of the card:
The new Diplomatic Tax Exemption Cards may be accepted by vendors in the same manner as the previously issued cards. Retailers making exempt sales to foreign officials must keep a record of the personal identification number on the official's Diplomatic Tax Exemption Card as proof that the sales are exempt from Wisconsin sales and use taxes. The Office of Foreign Missions includes on its website a database that allows retailers to verify the tax-exempt status of foreign officials. It may be accessed at www.state.gov/ofm/resource/ihv/20290.htm.
Last updated April 8, 2013