BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX
Petitioner, : INFORMAL DECISION
AUDITING
DIVISION OF THE : Appeal No. 87-0489
STATE TAX
COMMISSION OF UTAH, )
Respondent. :
_____________________________________
STATEMENT OF CASE
This
matter came before the Utah State Tax Commission for an Informal Hearing on
XXXXX. James E. Harward, Hearing
Officer, heard the matter for and in behalf of the Tax Commission. XXXXX appeared. XXXXX appeared representing the Respondent.
FACTS
In
XXXXX, the sister to the Petitioner, XXXXX, came to Utah during a separation
from her husband. On the way her
automobile broke down. She went to the
XXXXX in XXXXX, Utah and attempted to purchase a XXXXX automobile. Because of her financial condition she was
unable to qualify for the financing.
Therefore, a co-signer was sought.
The Petitioner agreed to co-sign for the automobile. The Petitioner's sister, XXXXX, then
purchased the automobile and moved to XXXXX where she worked for a period of
time before moving back to XXXXX.
During the course of approximately a year, the automobile was in and out
of Utah on numerous occasions due to the death of the Petitioner's mother and
the repossession of the automobile by the XXXXX Finance Company. The Petitioner ultimately ended up with the
vehicle by making up the back payments and taking possession of the vehicle and
then placing it up for sale. In XXXXX,
the Petitioner refinanced the vehicle to make up the back payments and pay off
XXXXX. At that time, it was licensed
and registered in the state of Utah.
The Respondent argued that the Petitioner was an owner, as evidenced by
the conditional sale contract which listed XXXXX as a co-buyer. Further the registration of the vehicle in
XXXXX indicated the Petitioner as a co-owner.
Furthermore, the vehicle was used extensively in Utah after its
purchase. Not only by the Petitioner's
sister but also by the Petitioner after being repossessed.
DECISION AND ORDER
The
Petitioner argues that since he was a co-signer only on the subject automobile
he should not be responsible for the payment of the sales tax in that the
Petitioner's sister qualified for the out-of-state non-resident exemption from
sales tax. However, the form of the
transaction indicates that the Petitioner was in fact an owner or co-buyer of
the automobile. The Commission would be
persuaded by the argument that if the Petitioner were in fact a co-signer only
then the sales tax would not be due.
The Sales and Use Tax Act of the state of Utah provides for tax on the
purchase or the amount paid or charged for any retail sales of tangible
personal property made within the state.
An exemption is made for a sale to a non-resident of the state of Utah.
It appears from the paperwork that the sale was made jointly to a non-resident
and to a resident; the Tax Commission finds additional facts persuasive in
finding that the Petitioner is responsible for the payment of the sales tax.
Those additional facts are that the Petitioner was listed as an owner on the
title and on the registration of the vehicle and the vehicle was used
extensively in Utah after the purchase and after being repossessed by
XXXXX. In addition, the Tax Commission
finds that after the taking of the vehicle in XXXXX the Petitioner would have
been subject to the use tax provisions of the Sales and Use Tax Act and would
have been responsible for paying the tax anyway. Therefore, the Commission affirms the assessment of the tax but
finds that no penalty should be assessed and interest should be calculated
commencing on the first day of XXXXX.
It is so ordered.
DATED
this 20 day of October, 1987.
BY ORDER OF THE STATE TAX COMMISSION OF UTAH.
R. H. Hansen G.
Blaine Davis
Chairman Commissioner
Joe B.
Pacheco Roger
O. Tew
Commissioner Commissioner