state of arkansas department of finance & … · (acct. no.: ) audit no. audit period: dec....
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STATE OF ARKANSAS DEPARTMENT OF FINANCE & ADMINISTRATION
OFFICE OF HEARINGS & APPEALS
ADMINISTRATIVE DECISION IN THE MATTER OF GROSS RECEIPTS (SALES) &
COMPENSATING USE TAX ASSESSMENT
(ACCT. NO.: ) AUDIT NO.
AUDIT PERIOD: DEC. 2010 THROUGH SEPT. 2015 DOCKET NOS.: 17-5391 (SALES TAX)2 17-540 (USE TAX)3
TODD EVANS, ADMINISTRATIVE LAW JUDGE
APPEARANCES
This case is before the Office of Hearings and Appeals upon written protest
dated March 27, 2017, signed by (“President”) on behalf of the
, the Taxpayer. The Taxpayer
protested the assessments issued by the Department of Finance and
Administration (“Department”).
A hearing was held in this matter on September 12, 2017, at 10:30 a.m. in
Little Rock, Arkansas. The Department was represented by Lauren Ballard,
Attorney at Law, Office of Revenue Legal Counsel (“Department’s
Representative”). Also present for the Department was Devon Toney, Tax
Auditor, (“Auditor”) and Guy Meneley, Audit Supervisor (“Audit Supervisor”). 1 All listed amounts do not represent concessions agreed to by the Department after the assessment. 2 This amount represents (Tax) and (Interest). 3 This amount represents (Tax) and (Interest).
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The Taxpayer was represented by , Attorney at Law –
(“Taxpayer’s Representative”) at the
administrative hearing. Also present for the Taxpayer was the President and
(“Cost Accountant”). The record was closed and this matter was
submitted for a decision on September 12, 2017.
ISSUE
Whether the Department’s assessment of certain transactions, after
concessions, are correct under Arkansas law. Yes.4
FACTS AND CONTENTIONS OF THE PARTIES
The Department provided a summary of several relevant facts in its
Answers to Information Request, stating as follows:
("Taxpayer'') is a printer and located in , Arkansas. The printer uses a method of
printing known as is a quick, high capacity form of printing that involves ink being
referred to as " The then the paper being printed. The printing plates are
often inked and washed clean by separate rollers. A visual diagram of this basic process is attached, along with a copy of the actual schematic of the Taxpayer's machine, as Exhibit l. The rollers and cylinders often wear down with time and must either be repaired or replaced. On November 9, 2015, the Department of Finance and Administration (“Department") conducted an initial audit appointment through its auditor Devon Toney ("auditor"). The auditor reviewed sales invoices, journals, purchase invoices, credit card statements, and fixed asset listings to determine unreported taxable purchases. The auditor worked with the Taxpayer to resolve some items. To continue the audit while allowing time for the Taxpayer to respond, the Taxpayer provided the auditor with a waiver and extension of the statute of limitations through January 31, 2017. A copy of the executed waiver is attached as Exhibit 2. After reviewing the relevant invoices, the auditor requested exemption certificates from the purchasers. The auditor was informed that the
4 This decision does not address any concessions agreed to by the parties.
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Taxpayer did not have copies of exemption certificates. Despite the Taxpayer's failure to retain these certificates, the auditor requested that the Taxpayer collect exemption certificates from the purchasers and, if valid, used the exemption certificates to qualify certain invoices for exemption. Of those presented, the auditor disallowed several exemption certificates as invalid. A copy of those exemption certificates is attached as Exhibit 3. The auditor maintained a listing of disallowed exempt sales with both the Taxpayer's and Department's respective positions on the invoices. A copy of the listing is attached as Exhibit 4. The auditor then compiled a final schedule of all sales and use tax assessed against the taxpayer. These final audit schedules are attached as Exhibit 5. Sales Tax. With respect to sales tax, the Department concluded that the Taxpayer should have collected sales tax on many invoices that it categorized as tax exempt. Of those, most exemptions were disallowed because the Taxpayer did not provide a tax exemption certificate from the purchaser claiming that the sales were sale for resale. In most of these sales, the purchaser was distributing the product free of charge. In some invoices, the exemptions were disallowed because the Taxpayer neglected to provide sufficient proof that invoices were written off as bad debt. Use Tax. With respect to use tax, the Department concluded that the Taxpayer should have remitted use tax on many out of state purchases, including rollers, printing and press cleaning supplies. The auditor allowed an exemption for printing
and plates.
HEARING TESTIMONY
The Auditor’s Testimony
During the administrative hearing, the Auditor testified that she
performed the relevant audit of the Taxpayer. She completed the audit by
reviewing sales and purchase journals, sales and purchase invoices, and credit
card statements. She stated that the Taxpayer is a printing company that
produces and for customers. During a plant
tour, she reviewed the printing process. The Taxpayer utilizes
5 The Taxpayer later conceded the printing
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The process utilizes rollers and however, the only
item that imparts ink onto the paper is the
The Auditor testified that the functions as the physical die or mold
of the print job. She argued that the rollers function as components of the
and distribute ink and water to the The rollers wear out
over time. She asserted that the replacement of rollers are taxable as
insubstantial replacements of components of the She stated that
the Taxpayer also utilizes an item referred to as a are used to
during the printing process, function as components of the
and wear out over time. The printing were deemed
exempt during the audit as the initial die or mold of the print job but the rollers
and were deemed taxable as replacement parts of the The
Auditor asserted that the rollers are not molds or dies because they do not create
or determine the shape of the print jobs.
The Auditor next stated that the motors and
are component parts of the and constitute taxable replacement
parts. During the audit, she did not remember reviewing invoices containing
printing plates. The Auditor concluded that chemicals used to cure or set the ink
were deemed exempt during the audit. However, she explained that cleaning
chemicals (such as autowash, easyclean, globalwash, wipes, and additional
chemicals) were used to clean the between jobs and do not become
an integral part of the finished process. She concluded that the cleaning
chemicals were taxable and not exempt under GR-55.1. She explained that
is used to connect two paper rolls prior to printing to create a
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continuous roll of paper. The Auditor stated that the is eventually
cut off, thrown away, and does not become a component part of the product sent
to customers. She argued that the should be taxable as tangible
personal property.
Regarding the sales tax audit and the exemption certificates, the Auditor
testified that the Taxpayer did not have any exemption certificates on file at the
beginning of the audit. She allowed the Taxpayer to acquire exemption
certificates over 120 days from its registered customers. Some of the customers’
exemption certificates or letters were disallowed by the Auditor because those
items lacked a valid sales tax permit number. Either no exemption certificates or
invalid certificates were provided by the
the
and the
The Auditor proceeded to discuss the transactions with specific customers.
She asserted that the did not possess a sales
permit. That customer did provide a signed exemption certificate to the Taxpayer
but did not provide an account number. She stated that
did not make an exemption claim regarding its purchases.
also issued an exemption claim letter to the Taxpayer but lacked
a sales tax permit during the audit period.
The Auditor further stated that the did not provide
an exemption certificate and did not possess a sales tax permit. The Auditor,
however, was told that (a customer possessing a
Arkansas sales tax permit) was the actual purchaser for those transactions. She
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asserted that the was billed for these transactions and was
the purchaser. The Auditor asserted that those transactions were also taxable.
provided an exemption claim letter but did not have a sales tax
permit during the audit period. She further testified that the
did not make an exemption claim for their purchases of
, and an
Additionally, the Auditor asserted that many of the printed materials that
are purchased by the Taxpayer’s customers are distributed for free to
and not resold. She provided the following examples of that are
simply given away to
( and –
(newspaper inserts or given away), and
the She stated that the associated
should not qualify as for purposes of Arkansas Gross
Receipts Tax Rule GR-48(F) (an exemption for sold by regular
The Auditor explained that she did not assess sales of
(provided by the to its customers
without an additional charge); however, she noted that customer provided a valid
exemption certificate to the Taxpayer.
The Auditor then explained that the bad debt deductions for the
and transactions were denied because the
Taxpayer has not shown that these items were deducted as bad debts. Early in the
audit, the Auditor was informed that the purchases were
donated to the organization as charitable contributions without a collection
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effort. Later in the audit, however, she was told that collection was attempted but
the items had not been written off as bad debts. She asserted that the governing
rules require that the items be reported and later written off as bad debts to be
removed from the assessment. Since the transactions had not been reported or
written off, she deemed these transactions to be taxable.
The President
The President testified that he has worked for the Taxpayer for eleven (11)
years, is extremely familiar with its printing process, and is involved in repair
decisions. He explained that the uses
to create ninety-nine-point-nine percent (99.9%) of the
remaining colors during the printing process. After printing, the printed material
ultimately goes through an oven to cure the ink. The Taxpayer utilizes
: a ( and a (
He testified that the rollers at issue are used to transfer the ink across
multiple rollers (referred to as the “ to an aluminum printing plate that
is attached to the plate cylinder. The rollers are cylinders. The rollers contain a
steel or hollow core with a rubber (or some other substrate) coating its exterior.
The rollers are stored on a consignment basis. When the rubber or nylon coating
for a roller is worn off, it is returned to the vendor for recoating and a stored
roller is cycled into production. The rollers are thus rotated with the vendor;
however, the Taxpayer does not necessarily own any particular roller core. Each
roller lasts for an uncertain length of time but are generally not replaced too
often. Some rollers are replaced at least once a month. If a core is damaged, the
Taxpayer must buy a new replacement core. He explained that the rollers ensure
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that the ink and water mixture is uniformly applied to the printing plate. While
the printing plates have to be replaced between jobs, the rollers typically will not
need to be replaced at that time. The rollers’ function is to flatten the ink to create
a thin film of ink that is ultimately applied to the upper and lower printing plates.
He asserted that the rollers shape or mold the ink to create a uniform print. The
rollers, however, do not make contact with the paper. In the rollers’ absence, the
President explained that the printing process would not work.
Describing the use of the printing ink, the President testified that the
printing ink is purchased in totes and pumped to fountain jets on and
The ink fountain contains a series of that are
opened and closed by the which controls the amount of each
ink type that is dispensed onto the first roller and ultimately onto the printed
paper. An opens and closes a The are
automatically controlled by the The
creates a preset that will be manually adjusted by the pressmen to correct any
print issues. The closed loop contains several
s that take photos of the printed product to ensure that the
printed material meets specifications. The sends its
information back to the and pressmen.
A had been used for years, but the system
was completely replaced with a new system in 2016 (outside the audit period)
and several components of the system were also replaced during the
audit period. Several items (such as lens trays and a computer system from
were replaced in March 2013, September 2013, and March 2014.
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Those transactions involved the replacement of an
that said was faulty. At this point, the President described the system
as being essentially gutted with replacement of the associated electronics. The
President explained that the camera was replaced with the track and motors that
move the camera. The computers, software, and other internal components were
also replaced along with many of the wires. He asserted that only the camera case
was reused. The charges from March, May, and August 2015 might
have been related to the replacement, but he does not know for sure.
After the rollers, the ink is eventually applied to a printing plate. The
President explained that the printing plate contains small indentions to repel or
attract ink. The water (containing a chemical called “ repels the oil-based
ink from certain places on the printing plate. A portion of the ink, water, and
will be transferred to the finished product. After ink is applied, the printing plate
provides a
Two types of are
utilized by the Taxpayer: on
and a on
Discussing the cleaning of the presses, the President testified that
must be manually cleaned. however, has nozzles that spray cleaning
chemicals onto the machine for cleaning between print jobs. A small amount of
the cleaning chemicals does remain on the finished product but most of those
chemicals are burnt off within the ovens. The cleaning chemicals do not have a
purpose in the final product. If all of the cleaning chemicals could be removed
from the final product, it would not affect the final product, because it is not a
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necessary component of that product. The cleaning chemicals; however, must be
used to clean the printer and ensure a clean print. Without the cleaning
chemicals, the press would have to be dismantled and cleaned between jobs.
When a job is stopped, the are still set and pouring ink, resulting in a “major
mess” that must be cleaned between jobs. The function of the cleaning chemicals
is to remove excess ink from the rollers and before, during, and after a
print job.
Discussing the the President explained that the
is sticky on both sides and is used to combine two rolls of paper to ensure a
continuous print. The should be thrown away; however, it has been
accidently left on printed materials received by customers. The
should not be part of the final product.
Discussing the UV lamps, the President testified that the UV lamps
contained in the June 2011 invoice are utilized in the UV
coating system to apply a or finish to
That finish is a chemical coating that becomes a component part of the
finished product. The President stated that the UV lamps help to cure that
coating. The lamps are installed at between the .
He asserted that the UV lamps do not apply the chemical but are a mold
or die due to their curing activity.
The Cost Accountant
The Cost Accountant testified that the is also where the
becomes involved. She was of the opinion that replaced every
component of the except the box that holds the camera on
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the track. She said that the replacement was accomplished in a piecemeal fashion
while tried to repair the existing
Discussing the sales tax exemption claims, the Cost Accountant testified
that the Taxpayer prints for the which
was originally picked up but later removed by the Auditor. The prints
a regular that is solely sent to of that For the
she stated that the Taxpayer prints a
( that is only received by paying of the
organization. The application on the
website states that the is included with the
payment of The Taxpayer directly mails the to that
The Cost Accountant requested an exemption certificate
from the and was informed by that customer
that should be exempt as a sale which is resold on
based on the advice from their accountant. Their accountant also
informed the that a sales tax permit was not necessary because it only
performed exempt sales. The signed an
exemption certificate for the Taxpayer but did not register for a sales tax account.
The later applied for a permit but had not
received it by the time of the hearing.
Discussing other customers, the Cost Accountant testified that
provides a for various state
Currently, the Taxpayer directly prints the for the
The Cost Accountant stated that the cost of the
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is included in each The Taxpayer also prints a
which is also included in the She further
testified that produces several including
and She asserted that the cost of
these is included in the for of the
Arkansas and The Cost Accountant was not
aware of any separately stated charge for the She
thinks, at one time, charged for the from its
however, she does not have any paperwork to confirm that fact. The
Cost Accountant further testified that stated that their
attorney instructed them not to register for sales tax because it was selling the
items on a She also spoke with that attorney who confirmed
this statement. would not provide an exemption certificate.
Though the is billed for their purchases, the Cost
Accountant stated that is the actual customer
for the sales because
provides the draft to be printed and makes the order. She does not discuss the
transaction with the She stated that
possesses a sales tax permit and provided an exemption certificate.
She also explained that the does not have a permit and
could not provide an exemption certificate. The Taxpayer prints
and the newsletter for that customer. The Cost Accountant explained
that both of these are only provided to that pay
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If had provided an exemption certificate
prior to the audit, the Cost Accountant said that she would have relied on that
document and not charged sales tax to the customer. The Cost Accountant
additionally testified that prints which is
sold in grocery stores or by Though the Taxpayer has requested an
exemption certificate, that customer has only provided a copy of their sales tax
permit.6 The purchases an
and cards from the Taxpayer. The Taxpayer directly mails those items to the
Discussing the bad debt deduction, the Cost Accountant explained that the
Taxpayer does not expect the to pay its bill. She
explained that a disagreement erupted between the Taxpayer’s owners over
whether the transactions were gifts or should be paid. The Cost Accountant
testified that she did invoice the and try to collect the amount owed.
During a subsequent telephone call with the customer, she stated that the
refused to pay the bill, thinking it was a donation. The
owed more than as of August 1, 2016. The original invoices were dated
from 2013 and 2014. The Taxpayer did not report the items as bad debts for sale
tax purposes to her knowledge. The Cost Accountant further testified that the
Taxpayer has reported these amounts as bad debts for income tax purposes.
After a general discussion of the burdens of proof in tax proceedings and a
discussion of the applicable law, each contested category of the protested 6 A copy of this permit is not present in the record, Exhibit 3 to the Department’s Answers to Information Request does include a letter from this customer, which states that its publication are sold by a That letter, however, does not provide a sales tax account number.
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transactions shall be addressed with a summary of the parties’ legal arguments, a
legal analysis, and associated conclusions.
CONCLUSIONS OF LAW
Burdens of Proof
Ark. Code Ann. § 26-18-313(c) (Supp. 2017) provides, in pertinent part, as
follows:
The burden of proof applied to matters of fact and evidence, whether placed on the taxpayer or the state in controversies regarding the application of a state tax law shall be by preponderance of the evidence. A preponderance of the evidence means the greater weight of the evidence.
Chandler v. Baker, 16 Ark. App. 253, 700 S.W.2d 378 (1985). In Edmisten v. Bull
Shoals Landing, 2014 Ark. 89, at 12-13, 432 S.W.3d 25, 33, the Arkansas
Supreme Court explained:
A preponderance of the evidence is “not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other. The Department bears the burden of proving that the tax law applies to an
item or service sought to be taxed, and a taxpayer bears the burden of proving
entitlement to a tax exemption, deduction, or credit. Ark. Code Ann. § 26-18-
313(d) (Supp. 2017). Statutes imposing a tax or providing a tax exemption,
deduction, or credit must be reasonably and strictly construed in limitation of
their application, giving the words their plain and ordinary meaning. Ark. Code
Ann. § 26-18-313(a), (b), and (e) (Supp. 2017). If a well-founded doubt exists
with respect to the application of a statute imposing a tax or providing a tax
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exemption, deduction, or credit, the doubt must be resolved against the
application of the tax, exemption, deduction, or credit. Ark. Code Ann. § 26-18-
313(f)(2) (Supp. 2017).
Tax Assessment
I. Sales Tax Issues
After a general discussion of the law governing the application of Arkansas
sales tax, the protested items shall be addressed in turn. Arkansas Gross Receipts
(sales) Tax generally applies to all sales of tangible personal property and certain
specifically enumerated services, unless an exemption or credit is shown to apply.
Ark. Code Ann. § 26-52-301 (Supp. 2017). Printing services of all kinds are
specifically enumerated taxable services. Ark. Code Ann. § 26-52-301(4) (Supp.
2017). Initially, the Taxpayer’s services generally qualify as printing services.
Consequently, its services are taxable unless an exemption is shown to apply.
Generally, the liability for collection and remittance of sales tax is upon the
seller. Ark. Code Ann. § 26-52-508 (Supp. 2017). A seller, however, may be
relieved of this liability if the customer makes an exemption claim and the seller
obtains certain information from that customer. Ark. Code Ann. § 26-52-517(a)
(Supp. 2017). At that point, the purchaser will become liable for the sales tax
liability if the Department ultimately determines that the purchaser improperly
claimed an exemption. Ark. Code Ann. § 26-52-517(e) (Supp. 2017).
If a seller fails to obtain sufficient information from a purchaser making an
exemption claim, a safe harbor is present. Ark. Code Ann. § 26-52-517(g)(2)(A)
(Supp. 2017). Under that subsection, the seller is granted an additional one
hundred and twenty (120) days from the date of the Department’s request for
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substantiation to prove “by other means that the transaction was not subject to
sales or use tax or to obtain in good faith a fully completed exemption certificate
from the purchaser.” Id. To obtain an exemption certificate in good faith, the
exemption must have been available at the time in the jurisdiction where the
transaction is sourced, could be applicable to the item being purchased, and must
be reasonable for the purchaser’s business. Ark. Code Ann. § 26-52-517(g)(2)(B)
(Supp. 2017).
Further, the Arkansas Supreme Court has explained that the Arkansas
General Assembly is sole arbitrator of policy decisions within Arkansas and it
would be inappropriate for an administrative agency or court to refuse to enforce
a state law as it reads based on a policy disagreement. Snowden v. JRE
Investments, Inc., 2010 Ark. 276, 370 S.W.3d 215. Consequently, any arguments
by the Taxpayer’s Representative that governing statutes reach a harsh or unfair
result and equitable remedies should be granted in the alternative must be
rejected.
a. Sale for Resale Exemption
In his Answer’s to Information Request, the Taxpayer’s Representative
asserted that the Auditor agreed that the Taxpayer’s sales were exempt as sales
for resale because she exempted any transactions where the customer provided a
valid resale certificate.7 He proceeded to argue that the transactions still qualified
7 Based on the record, it appears that this statement represents a misunderstanding of the Auditor’s analysis. Here, it appears that the Auditor excluded these transactions because the customers provided a qualifying exemption claim. As stated above, a qualifying exemption claim shifts the tax burden from the seller to the purchaser even if the exemption claim is later determined to be improper. Consequently, the removal of these transaction from the audit does not necessarily mean that the Auditor concluded that the purchases qualified for the sale for resale exemption.
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as sales for resale even if the Taxpayer’s customers did not possess sales tax
permits so long as the subsequent resale of the items qualified as exempt
sales under Arkansas Gross Receipts Tax Rule GR-48(F). He argued
that requiring the Taxpayer’s customers to obtain a sales tax permit to purchase
items for resale (when he concluded that the subsequent resales were exempt)
was too burdensome and improperly taxed transactions that were otherwise
exempt.
During the administrative hearing, the Department’s Representative
argued that the provided sales tax exemption certificates were invalid due to the
absence of sales tax permit numbers. Even if the certificates were valid, she
argued that the exemption certificates could not be applied to relieve the
Taxpayer of liability because the and were given
away to of their and not resold. Consequently, she argued
that sale for resale exemption could not be applicable to the items purchased as
required by Ark. Code Ann. § 26-52-517(g)(2)(B) (Supp. 2017).
During the administrative hearing, the Taxpayer’s Representative noted
that, if the customers failing to provide an exemption certificate had provided
one, the Auditor would not have assessed the transactions (like the
invoices). Consequently, he reasoned that it was irrelevant whether
the transactions actually qualified for the sale for resale exemption. He again
asserted that it was unfair to require the Taxpayer’s customers to obtain sales tax
permits since he concluded that their sales should qualify as exempt
under Arkansas Gross Receipts Tax Rule GR-48. He acknowledged
that the Taxpayer must collect Arkansas sales tax in the absence of an exemption
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certificate under the law; however, he argued that application of the law in this
matter was improper because it resulted in taxation of transactions that were
otherwise exempt. He explained that the Taxpayer’s position could be
characterized as a plea for equitable relief.
One narrow exemption is implicated by the arguments raised by the
parties with respect to these transactions: the sale for resale exemption. Ark.
Code Ann. § 26-52-401(12)(A) (Supp. 2017) grants a narrow exemption for sales
for resale, stating as follows:
Gross receipts or gross proceeds derived from sales for resale to persons regularly engaged in the business of reselling the articles purchased, whether within or without the state if the sales within the state are made to persons to whom gross receipts tax permits have been issued as provided in § 26-52-202.8 [Emphasis supplied].
Under the governing statute, a customer may not claim the sale for resale
exemption unless that customer has attained a sales tax permit. Consequently, in
the absence of a sales tax permit, the transaction cannot qualify as a sale for
resale and the Taxpayer’s exemption claim cannot satisfy the requirement
contained at Ark. Code Ann. § 26-52-517(g)(2)(B)(ii) (Supp. 2017) (stating that
the exemption must be potentially applicable to the items being purchased).
Though the Taxpayer’s Representative asserted that this seems unfair or
burdensome for customers, those arguments do not allow this Office to overlook
the express statutory requirement that customers must possess a sales tax permit
8 The requirement that the purchaser must possess a sales tax permit is repeated in Arkansas Gross Receipts Tax Rule GR-53(A), a subsection of the governing regulation.
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to qualify for the sale for resale exemption. 9 The analysis of the relevant
transactions shall proceed with the understanding.
i.
In his protest, the Taxpayer’s Representative asserted that this transaction
should be exempted as a sale for resale. In his Answers to Information Request,
the Taxpayer’s Representative explained that the fee for the monthly at
issue is included in the for the . He
asserted that no exemption certificate should be required based on his analysis
stated above. In her Answers to Information Request, the Department’s
Representative asserted that, though this customer made an exemption claim by
letter, this ( was not resold but given away to
of the and did not qualify as a regular under
Arkansas Gross Receipts Tax Rule GR-48. Consequently, she reasoned that the
Taxpayer cannot demonstrate that the sale for resale exemption could be
available for the purchased item, under Ark. Code Ann. § 26-52-517(g)(2)(B)
(Supp. 2017). No sales tax account number was contained in the provided
exemption certificate.10
Here, the Auditor has explained that the
did not possess a sales tax permit during the audit period.11 The Taxpayer has not
shown that the sale for resale exemption could apply to these transactions by a
9 The issue of whether or not the Taxpayer’s customers’ transactions qualify as exempt
under Arkansas Gross Receipts Tax Rule GR-48(F) even though the are not separately billed to the shall not be addressed in this decision as it is rendered moot. 10 See Exhibit 3 to the Department’s Answers to Information Request. 11 The Cost Accountant’s testimony also supported this statement.
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preponderance of the evidence. Thus, the transaction does not qualify as a sale
for resale and the Taxpayer’s exemption claim cannot satisfy the requirement
contained at Ark. Code Ann. § 26-52-517(g)(2)(B)(ii) (Supp. 2017). Consequently,
the Department’s assessment of these transactions is sustained.
ii.
In his protest, the Taxpayer’s Representative asserted that this transaction
should be exempted as a sale for resale or as services not subject to tax. In his
Answers to Information Request, the Taxpayer’s Representative explained that
the fee for the at issue is included in the
for the He asserted that no exemption
certificate should be required based on his analysis stated above. In her Answers
to Information Request, the Department’s Representative asserted that the
Taxpayer cannot be relieved of its tax liability for these transactions because the
Taxpayer has not shown that this customer made a sales tax exemption claim at
the time of the transaction or during the audit.
Here, the Auditor has testified that this customer did not make an
exemption claim regarding its purchases. Additionally, it is not shown that the
customer possessed a sales tax permit during the Audit Period. The Taxpayer has
not shown that the sale for resale exemption applies to these transactions by a
preponderance of the evidence. Consequently, the Department’s assessment of
these transactions is sustained.
iii.
In his protest, the Taxpayer’s Representative asserted that this transaction
should be exempted as a sale for resale. In his Answers to Information Request,
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the Taxpayer’s Representative explained that the fees for the annual at
issue are included in the for the relevant
12 He asserted that no exemption certificate should be required
based on his analysis stated above. In her Answers to Information Request, the
Department’s Representative explained that this customer stated that it is a
company responsible for producing (
and for its
clients. She asserted that, since customers provide the
without cost to their the items do not
qualify as sales for resale, and the items do not qualify as regular
under Arkansas Gross Receipts Tax Rule GR-48. Consequently, she reasoned that
the Taxpayer cannot demonstrate that the sale for resale exemption could be
available for the purchased item, under Ark. Code Ann. § 26-52-517(g)(2)(B)
(Supp. 2017). No sales tax account number was contained in the exemption claim
letter.13
Here, the Auditor testified that this customer did not possess a sale tax
registration during the Audit Period.14 The Taxpayer has not shown that the sale
for resale exemption could apply to these transactions by a preponderance of the
evidence. Thus, the transaction cannot qualify as a sale for resale and the
Taxpayer’s exemption claim cannot satisfy the requirement contained at Ark.
12 These transactions are dissimilar from the other discussed in this opinion in that the do not pay for these The printing costs are paid by
in exchange for the This transaction structure would appear to undercut the statement that the purchase and resell these to their 13 See Exhibit 3 to the Department’s Answers to Information Request. 14 The Cost Accountant’s testimony also supported this statement.
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Code Ann. § 26-52-517(g)(2)(B)(ii) (Supp. 2017). Consequently, the Department’s
assessment of these transactions is sustained.
iv.
In his protest, the Taxpayer’s Representative asserted that this transaction
should be exempted as a sale for resale. In his Answers to Information Request,
the Taxpayer’s Representative asserts is the
actual customer for this transaction, is registered for the Arkansas sales tax, and
provided a qualifying exemption claim. If the is deemed to
be the actual customer, he argued that the fee for the annual at issue is
included in the annual for the organization. He asserted that
no exemption certificate should be required based on his analysis stated above.
In her Answers to Information Request, the Department’s Representative
asserted that, though claims to be the actual
customer, all invoices are addressed to the and that is the
actual customer. Further, she asserted that the is distributed free of
charge, does not qualify as a sale for resale, and, thus, remains taxable.
Here, the Auditor testified that the was billed for
the relevant transaction and was listed as the customer on the related invoices.15
Based on this evidence, the was the customer for these
transactions even though the Cost Accountant felt that
should be considered the real purchaser due to its control over the
transactions.
15 The Cost Accountant’s testimony also supported this statement.
23
The Auditor further testified that the did not
possess a sales tax permit during the Audit Period.16 The Taxpayer has not shown
that the sale for resale exemption could apply to these transactions by a
preponderance of the evidence. Thus, the transaction cannot qualify as a sale for
resale and the Taxpayer’s exemption claim cannot satisfy the requirement
contained at Ark. Code Ann. § 26-52-517(g)(2)(B)(ii) (Supp. 2017). Consequently,
the Department’s assessment of these transactions is sustained.
v.
In his protest, the Taxpayer’s Representative asserted that this transaction
should be exempted as a sale for resale. In his Answers to Information Request,
the Taxpayer’s Representative asserted that this relevant publication is resold at
retail and the Taxpayer would attempt to obtain a qualifying exemption claim
prior to the administrative hearing. In her Answers to Information Request, the
Department’s Representative asserted that, though the customer claimed its
( and are sold on
by a third party ( that statement is incorrect and
the are actually distributed free of charge. Consequently, she
reasoned that the Taxpayer cannot demonstrate that the sale for resale
exemption could be available for the purchased item, under Ark. Code Ann. § 26-
52-517(g)(2)(B) (Supp. 2017). No sales tax account number was contained in the
exemption claim letter.17
Here, the Auditor testified that did not possess a sales tax
permit during the Audit Period. The Taxpayer has not shown this assertion to be 16 The Cost Accountant’s testimony also supported this statement. 17 See Exhibit 3 to the Department’s Answers to Information Request.
24
incorrect. The Taxpayer has not shown that the sale for resale exemption could
apply to these transactions by a preponderance of the evidence. Thus, the
transaction cannot qualify as a sale for resale and the Taxpayer’s exemption claim
cannot satisfy the requirement contained at Ark. Code Ann. § 26-52-
517(g)(2)(B)(ii) (Supp. 2017). Consequently, the Department’s assessment of
these transactions is sustained.
vi.
In his Answers to Information Request, the Taxpayer’s Representative
explained that the fee for the at issue is included in the annual
for the organization. He asserted that no exemption certificate
should be required based on his analysis stated above. In her Answers to
Information Request, the Department’s Representative asserted that the
Taxpayer cannot be relieved of its tax liability for these transactions because the
Taxpayer has not shown that this customer made a sales tax exemption claim at
the time of the transaction or during the audit.
Here, the Auditor has testified that this customer did not make an
exemption claim regarding its purchases. Additionally, it is not shown that the
customer possessed a sales tax permit during the Audit Period. The Taxpayer has
not shown that the sale for resale exemption applies to these transactions by a
preponderance of the evidence. Consequently, the Department’s assessment of
these transactions is sustained.
b. Bad Debt Deduction
In his protest, the Taxpayer’s Representative asserted that no tax should
be due on these transactions since the customers did not pay the assessed
25
invoices. In his Answers to Information Request, the Taxpayer’s Representative
asserted that several invoices were not paid, were
not donated, and were written off as bad debts. Additionally, he asserted that
collection was attempted regarding these debts. He concluded that these
transactions qualified for the bad debt deduction. In her Answers to the
Information Request, the Department’s Representative asserted that the
Taxpayer has not shown that these items are eligible for the bad debt deduction
under Ark. Code Ann. § 26-52-309 (Repl. 2014).
During the administrative hearing, the Taxpayer’s Representative
explained that the Taxpayer had to pay sales tax on accrued transactions that
were not paid. He argued that, even though the law requires the Taxpayer to
report bad debts before the deduction is allowed, the Taxpayer’s failure to
complete this requirement was a technical violation and requested the removal of
the assessment of these transactions as equitable relief.
Ark. Code Ann. § 26-52-309 (Repl. 2014) allows a deduction for bad debts,
stating as follows, in relevant part:
(a) (1) A taxpayer is allowed a deduction from taxable sales for a bad debt. (2) Any deduction taken under this section that is attributed to a bad
debt shall not include interest. (b) The federal definition of “bad debt” in 26 U.S.C. § 166, as in effect on
January 1, 2007, is the basis for calculating a bad debt deduction under this section except that the amount calculated pursuant to 26 U.S.C. § 166 shall be adjusted to exclude: . . . .
(c) (1) A bad debt may be deducted on the sales and use tax return of a taxpayer for the tax period during which: (A) The bad debt is written off as uncollectible in the taxpayer's
books and records; and (B) The taxpayer is eligible to deduct the bad debt for federal
income tax purposes if the taxpayer or seller kept accounts on a cash basis or could be eligible to be claimed if the taxpayer or seller kept accounts on an accrual basis.
26
(2) For purposes of this subsection, a taxpayer who is not required to file a federal income tax return may deduct a bad debt on a sales and use tax return filed for the period in which the bad debt is written off as uncollectible in the taxpayer's books and records if the taxpayer would be eligible for a bad debt deduction for federal income tax purposes if the taxpayer were required to file a federal income tax return.
During the administrative hearing, the Taxpayer’s Representative
presented a three-page exhibit regarding the
transactions. The first page totals the customer’s invoice balance as of August 1,
2016, providing a balance of The second page lists the
account as a “Doubtful Acc”. Finally, the third page totals the customer’s
outstanding invoices as of July 31, 2016, providing a balance of
Here, the Auditor testified that the Taxpayer has not shown that the
relevant transactions were deducted as bad debts. Additionally, the Cost
Accountant has explained that there exists a disagreement between the
Taxpayer’s controlling families whether the
transactions are properly characterized as bad debts or charitable donations. She
also testified that the and the transactions were
reported as bad debt for income tax purposes.
Based on the record, the Taxpayer has not proven that it qualifies for the
bad debt deduction with regard to these transactions. Initially, significant doubt
is present whether the were actually bad debts. The
Cost Accountant explained that the Taxpayer’s controlling families disagreed on
whether the transactions are properly characterized
as bad debts or charitable donations. The Cost Accountant’s description of the
27
collection activities was limited to a billing and a phone call, after which the
matter appears to have been dropped. The collection activities seem minimal
and undercut the assertion the invoices were seriously treated as bad debts
by the Taxpayer. Additionally, though the Cost Accountant asserted that the
and transactions were deducted as bad debts for
income tax purposes, no documentation from the actual income tax returns
has been presented to verify this statement.18
The Taxpayer simply has not shown that the bad debt deduction should
apply to these transactions by a preponderance of the evidence. Though the
Taxpayer’s Representative has proposed that certain requirements should be
waived for this deduction, the deduction’s requirements cannot be waived for the
reasons stated within the sale for resale discussion above. Consequently, the
Department’s assessment of these transactions is sustained.
II. Use Tax Issues
Arkansas Compensating (Use) Tax generally applies to the privilege of
storing, using, distributing, or consuming tangible personal property and taxable
services within the State of Arkansas that were purchased outside this state. Ark.
Code Ann. § 26-53-106 (Supp. 2017). A purchaser is generally liable for Arkansas
Use Tax unless a seller pays the tax on the purchaser’s behalf. Ark. Code. Ann. §
26-53-123 (Supp. 2017). Generally, the protested items represent tangible
personal property and are subject to Arkansas use tax unless the Taxpayer
demonstrates that an exemption applies.
18 It is uncertain how the three-page hearing exhibit supports a finding that the transactions were actually deducted for income tax purposes.
28
a. Dies
The Taxpayer has argued that several items qualify as dies under Ark.
Code Ann. § 26-53-114(c)(3)(B)(ii) (Repl. 2014). To qualify as an exempt die, tool,
or device, a piece of equipment must be “attached to or a part of a unit of
machinery that determine the physical characteristics of the finished product . .
..” Ark. Code Ann. § 26-53-114(c)(3)(B)(ii) (Repl. 2014). Specifically, a Taxpayer
must demonstrate that an item is “attached to, or part of, a unit of machinery and
. . . imparts a predetermined and distinctive shape, pattern, texture, or finish to a
material or impresses an object or material . . ..” Arkansas Gross Receipts Tax
Rule GR-56(F)(2). Under the governing regulation and statute, an exempt die
need not be attached to a piece of machinery so long as the item still constitutes a
part of a unit of machinery. Further, the term “distinctive” has been interpreted
as a word of limitation. This Office has previously determined that characteristics
such as flat, smooth, or shiny are descriptive of conditions of the surface of a
product and do not qualify as distinctive textures or finishes.
Additionally, while purchases of dies and their component parts qualify for
the exemption under Arkansas Gross Receipts Tax Rule GR-56, the repairing of a
die remains taxable under GR-56(D). With this background in the governing law,
the protested transactions shall be analyzed.
i. Rollers
In his Answers to Information Request, the Taxpayer’s Representative
asserted that, if printing plates qualify as dies19, the rollers should also qualify as
dies because they perform “essentially the same function” as printing plates by 19 Printing plates are expressly listed as an example of a die under Arkansas Gross Receipts Tax Rule GR-56(G)(5).
29
transferring the ink directly to the printing plates. In her Answers to Information
Request, the Department’s Representative asserted that the rollers only directly
act on other parts of manufacturing machinery and equipment and are used to
either roll ink or water onto the printing plate. Consequently, she reasoned that
the rollers do not qualify as dies because the rollers do not impart a
predetermined or distinctive shape, pattern, texture, or finish to the finished
product. During the administrative hearing, the Department’s Representative
additionally argued that, even if the rollers qualified as dies, the resurfacing of
the rollers would remain taxable as die repairs.
During the administrative hearing, the Taxpayer’s Representative argued
that the rollers qualify as dies by imparting a physical characteristic to the ink (a
component part of the finished product).20 He explained that the vast majority of
the protested invoices involved the refinishing of rollers, but some transactions
do involve the replacement of roller cores. Addressing the recovering of the
rollers, he stated that the rollers are actually completely redone by stripping and
replacing the outside covering (not simply repaired in house). He asserted that
the roller transactions are more analogous to an inventoried replacement of the
rollers.
Here, the record demonstrates that the rollers function is more akin to an
ink delivery system. Additionally, the rollers do not impart a predetermined and
distinctive pattern to the printed material since those items do not make contact
with printed material. To the extent that the rollers assist in the flattening of the
ink, this Office has previously determined that flat does not qualify as a
20 This argument was also asserted in the Taxpayer’s Protest.
30
distinctive shape, pattern, texture, or finish. Further, the vast majority of the
transactions at issue involve the resurfacing of rollers whose current surface is
worn out, which is properly characterized as a taxable repair to a roller’s surface.
Repairs to the rollers’ surfaces would remain taxable regardless of whether the
rollers qualified as dies.
Based on the record, the Taxpayer has not shown that the transactions at
issue qualify for the exemption contained in Arkansas Gross Receipts Tax Rule
GR-56 by a preponderance of the evidence. Consequently, the Department’s
assessment of these transactions is sustained.
ii.
In his Answers to Information Request, the Taxpayer’s Representative
asserted that the controls the transfer of ink through the
rollers. He reasoned that this system should likewise qualify as a die since it
functions as a component part of the that ultimately imparts a
predetermined pattern or finish to the printed paper. In her Supplemental
Answers to Information Request, the Department’s Representative argued that
this system does not function as a die because it does not impart a predetermined
and distinctive shape, pattern, texture, or finish to the product but directly acts
on other components of manufacturing machinery and equipment.
During the administrative hearing, the Taxpayer’s Representative asserted
that, even though the components of this system were replaced in separate
transactions over a six to eight-month period, the whole system was eventually
replaced. If the transaction is not exempt as a substantial replacement of exempt
31
manufacturing machinery, he asserted, in the alternative, that the system should
be exempt as a die because the system controls the .
An exemption does exist for substantial replacement of certain
manufacturing machinery and equipment, which includes quality control
equipment that tests the quality of the manufactured product during
manufacturing. See Arkansas Gross Receipts Tax Rule GR-55(I).
Though the Cost Accountant testified that the major components of the
relevant were replaced. She stated that this replacement was
completed in a piecemeal fashion while a vendor attempted to troubleshoot
problems with the existing The record shows that the
was replaced through a series of separate transactions and not as
a single transaction that initially intended to replace that system. Each
transaction, when viewed separately, does not represent a substantial
replacement of the Consequently, the Taxpayer has not
demonstrated that the replacement of the qualified as a
substantial replacement of manufacturing machinery and equipment under Ark.
Code Ann. § 26-53-114(a)(2) (Repl. 2014).21
In the alternative, the Taxpayer’s Representative argued that the
should qualify as a die if it is not a substantial replacement of a
manufacturing machinery and equipment. The function is
to measure the quality of the finished product and to create a preset for the
21 It should be noted that, based on the President’s testimony, it is still uncertain whether the
transactions from March, May, and August 2015 were related to this replacement. Since those transactions are otherwise taxable and no exemption claim is
demonstrated, the Department correctly assessed those transactions as well even if they are not related to the replacement.
32
dispensing of ink in various concentrations, which is ultimately transported and
applied to the printing plate by the rollers. The however,
does not impart a predetermined and distinctive pattern to the finished product
and does not make contact with the printed material. The system simply
functions in conjunction with other components of the Based on
the record, the Taxpayer has not shown that the qualifies for
the exemption contained in Arkansas Gross Receipts Tax Rule GR-56 by a
preponderance of the evidence.
Consequently, the Department’s assessment of these transactions is
sustained.
iii. UV Light
During the administrative hearing, the Department’s Representative
asserted that the UV lamps only assist in drying a chemical on the finished
product and do not impart a unique characteristic to the products. Consequently,
she reasoned that the lamps do not qualify as dies. The Taxpayer’s Representative
argued that the UV lamps are integral to the UV coating process by curing the
finish. Even though the lamps do not physically touch the coating, he asserted
that the lamps impart a finish upon the
Here, the UV lights do not apply the finish to the Taxpayer’s
products but cure or dry the coating that was already applied. The drying of the
finish does not impart a predetermined and distinctive finish to the material
since that finish was already applied prior to the UV lights.
Based on the record, the Taxpayer has not shown that UV lights qualify for
the exemption contained in Arkansas Gross Receipts Tax Rule GR-56 by a
33
preponderance of the evidence. Consequently, the Department’s assessment of
these transactions is sustained.
iv.
In his Answers to Information Request, the Taxpayer’s Representative
stated that the should qualify as dies because they function as
component parts of the which ultimately imparts a predetermined
pattern or finish to the printed paper. In her Supplemental Answers to
Information Request, the Department’s Representative argued that these
do not function as a die because they do not impart a predetermined and
distinctive shape, pattern, texture, or finish to the product but directly act on
other components of manufacturing machinery and equipment. During the
administrative hearing, the Taxpayer’s Representative asserted the
function as dies by controlling the supply of ink dispensed during a print
job.
Here, the function is to dispense ink in various
concentrations, which is ultimately transported and applied to the printing plate
by the rollers. The do not impart a predetermined and distinctive
pattern to the finished product and do not make contact with the printed
material. These items simply function in conjunction with other components of
the
Based on the record, the Taxpayer has not shown that the
qualify for the exemption contained in Arkansas Gross Receipts Tax Rule GR-56
by a preponderance of the evidence. Consequently, the Department’s assessment
of these transactions is sustained.
34
b. Cleaning Chemicals
In her Answers to Information Request, the Department’s Representative
noted that cleaning chemicals are expressly taxable under Arkansas Gross
Receipts Tax Rule GR-55.1(C)(2)(c). During the Administrative Hearing, the
Department’s Representative again argued that the cleaning chemicals are
expressly excluded from the manufacturing chemical exemption under GR-
55.1(C)(2)(c) and does not qualify for the example contained in GR-55.1(C)(2)(a).
She also argued that the cleaning chemicals lack continuing utility and do not
qualify as manufacturing equipment.
During the administrative hearing, the Taxpayer’s Representative argued
that the cleaning chemicals qualify as manufacturing chemicals 22 and are
analogous to the example presented a t GR-55.1(C)(2)(a) in that the
cleaning chemicals ensure that the Taxpayer’s final product is not contaminated
by errant ink. He further argued that the disagreement between the two
sections of the governing rule (one disallowing cleaning chemicals and the
other allowing cleaning chemicals necessary for USDA compliance) should be
resolved in favor of granting the exemption to his client and overlooking the
express exclusion to the exemption contained in GR-55.1(C)(2)(c).
An exemption does exist for chemicals consumed or used by “producing,
manufacturing, fabricating, processing, or finishing articles of commerce at
manufacturing or processing plants or facilities in the State of Arkansas . . ..”
Ark. Code Ann. § 26-52-401(35)(A) (Supp. 2017). Sales tax exemptions
must be applied uniformly to Arkansas Use Tax. Ark. Code Ann. §
22 This argument was also asserted in the Taxpayer’s Protest and Answers to Information Request.
35
26-53-112(2) (Supp. 2017). Addressing this exemption, Arkansas Gross
Receipts Tax Rule GR-55.1(C)(2)(c) specifically provides, however:
“Substances used to fuel, cool, heat, lubricate, clean, protect, maintain, operate,
repair, or otherwise affect machinery or equipment used in a manufacturing or
processing facility, or the facility itself, are not exempt.”
That regulation, however, also provides that: “sanitization chemicals used
to meet USDA standards for machinery and equipment used in processing meat
and poultry for human consumption” are exempt as manufacturing chemicals.
Arkansas Gross Receipts Tax Rule GR-55.1(C)(2)(a).
Here, the cleaning chemicals do not qualify for the example under
Arkansas Gross Receipts Tax Rule GR-55.1(C)(2)(a). Additionally, the cleaning
chemicals do qualify for the exclusion contained in GR-55.1(C)(2)(c). Further,
exemptions must be construed in limitation of their application and uncertainty
regarding the application of an exemption must be resolved by denying the
exemption. Ark. Code Ann. § 26-18-313(b) and (f)(2) (Supp. 2017). Considering
the rules of construction and burdens of proof, the Taxpayer has not proven
entitlement to the exemption by preponderance of the evidence, and, thus, the
Department has correctly denied the Taxpayer’s exemption claim with respect to
the cleaning chemicals.
During the Administrative Hearing, the Taxpayer’s Representative also
argued that the cleaning chemicals should qualify as exempt manufacturing
equipment.23 The Arkansas Supreme Court has explained that certain chemicals
may qualify as exempt manufacturing equipment under Ark. Code Ann. § 26-53-
23 This argument was also asserted in the Taxpayer’s Answers to Information Request.
36
114(c)(3)(B)(ii) (Repl. 2014). Specifically, the Court noted that the relevant
chemicals must be used directly in manufacturing, serve as instruments or tools
with some degree of complexity, and possess continuing utility. Weiss v. Chem-
Fab Corp., 336 Ark. 21, 984 S.W.2d 395 (1999).
Here, the testimony explained that the cleaning chemicals are used to
clean the machine between print jobs and are not reused for other print jobs.
Based on this information, the cleaning chemicals lack continuing utility, a
necessary element, and, thus, cannot qualify as exempt manufacturing
equipment. The remainder of the elements shall not be analyzed as those issues
are rendered moot. The Department has correctly denied the Taxpayer’s
exemption claim.
Consequently, the Department’s assessment of these transactions is
sustained.
c.
In her Supplemental Answers to Information Request, the Department’s
Representative argued that this item does not qualify as a sale for resale because
the does not become an integral part of the finished product but is
discarded as waste.
The sale for resale exemption 24 does apply to certain items used by
manufacturers. The governing statutory subsection provides as follows:
(i) Goods, wares, merchandise, and property sold for use inmanufacturing, compounding, processing, assembling, or preparing forsale can be classified as having been sold for the purposes of resale or thesubject matter of resale only in the event the goods, wares, merchandise,
24 As stated above, sales tax exemptions apply equally to use tax.
37
or property becomes a recognizable integral part of the manufactured, compounded, processed, assembled, or prepared products. (ii) The sales of goods, wares, merchandise, and property not conforming to this requirement are classified for the purpose of this act as being “for consumption or use”; . . ..
Both “recognizable” and “integral” are defined in the governing rule as follows:
a. "Recognizable" means capable of being recognized in the finished product. The capability to recognize the effect of goods, wares, merchandise, or property upon the finished product is insufficient to establish that the goods, wares, merchandise or property has been resold.
b. "Integral" means essential to the completeness of the finished product. Arkansas Gross Receipts Tax Rule GR-53(C)(1). Here, the President has testified that the is thrown away and
should not be sent to the Taxpayer’s customer. This record shows that the
is not an integral part of the Taxpayer’s finished products, and, thus,
does not qualify for the sale for resale exemption. Consequently, the
Department’s assessment of these transactions is sustained.
Interest
Interest must be assessed upon any tax deficiencies for the use of the
State’s tax dollars. See Ark. Code Ann. § 26-18-508 (Repl. 2012). Consequently,
the assessment of interest on the assessed transactions (after adjustments
necessitated by any concessions by the Department) is sustained.
DECISION AND ORDER
After adjustments necessitated by concessions agreed to by the
Department, the remainder of the assessments are sustained. The file is to be
returned to the appropriate section of the Department for further proceedings in
accordance with this Administrative Decision and applicable law. Pursuant to
38
Ark. Code Ann. § 26-18-405 (Supp. 2017), unless the Taxpayer requests in writing
within twenty (20) days of the mailing of this decision that the Commissioner of
Revenues revise the decision of the Administrative Law Judge, this decision shall
be effective and become the action of the agency.
The revision request may be mailed to the Assistant Commissioner of
Revenues, P.O. Box 1272, Rm. 2440, Little Rock, Arkansas 72203. A revision
request may also be faxed to the Assistant Commissioner of Revenues at (501)
683-1161 or emailed to [email protected]. The Commissioner of
Revenues, within twenty (20) days of the mailing of this Administrative Decision,
may revise the decision regardless of whether the Taxpayer has requested a
revision.
The Taxpayer may seek relief from the final decision of the Administrative
Law Judge or the Commissioner of Revenues on a final assessment by following
the procedure set forth in Ark. Code Ann. § 26-18-406 (Supp. 2017).
DATED: November 9, 2017