A. Nonprofit corporations or associations, religious, charitable and educational institutions. Business income not included. The exclusion from taxation of receipts from the business of nonprofit religious, charitable or educational organizations is limited to those receipts derived from activities which are connected with the noncommercial operation of the organization. Commercial activities carried on by such an organization are taxable. All business income of nonprofit religious and charitable and educational organizations is taxable.
B. Receipts from sales to governmental agencies and nonprofit organizations. Sales to institutions. Receipts from sales made or services rendered to governmental bodies and to religious charitable and educational corporations and associations shall not be excluded from the tax base. The statute does not grant any exemption to taxpayers transacting business with such agencies or institutions.