Letter
September 7, 1990
September
7, 1990
Mr.
Joe Pacheco, Commissioner
Utah
State Tax Commission
160
East 300 South
Salt
Lake City, Utah 84134
RE:
Request for Advisory Opinion - Sales/Use Tax Exemption for Interstate Carriers
Dear
Commissioner Pacheco:
A
client of ours is planning to purchase a number of large tractor-trailer units
for their transportation fleet. We are concerned as to the proper method to
avoid the Utah sales or use tax allowed carriers hauling in interstate commence.
We are also concerned as to whether the policy has been in effect during the
past three years. Enclosed is a copy (previously faxed to you on July 13, 1990)
of the request for an Advisory Opinion dated January 31, 1990.
It
was our understanding that XXXXX of the Auditing Division had drafted a
preliminary "Advisory Opinion" for the Commission's review. Since the
amount of money involved is quite significant, our client would appreciate an
answer in the very near future.
Your
help in resolving this issue will be appreciated.
Very
truly yours
XXXXX,
Special Consultant
September
7, 1990
XXXXX,
Special Consultant
I
am in receipt of your letter of September 7, 1990, regarding your request for
advisory opinion on tax exemption for interstate carriers. Please be advised
that the Commission currently has this under advisement and we will notify you
as soon as we have reached a decision.
Very
Truly yours,
Joe
B. Pacheco
Commissioner
January
31, 1990
XXXXX,
Managing Auditor
Utah
Sales and Use Tax
160
East 300 South
Salt
lake City, Utah 84134
Re
Advisory Opinion -- Sales/Use Tax Exemption for Interstate Carriers
Form
TC-767 (copy attached), evidently has not been changed since August 1987. On
page two it states, "distributors, retailers, or others hauling their own
products do not qualify for the exemption even though they may regularly
back-haul commodities for hire."
It
was my understanding that the Commission ruled that this restriction should not
apply and that a distributor, retailer, etc., even though they primarily haul
their own product, may avail themselves to the interstate exemption. This can
be affected by: 1) taking physical delivery of a just purchased or leased
tractor or trailer outside the state of Utah, and 2) having its first payload for hire originating outside Utah, and
3) "regularly" hauling for hire in interstate commerce, even if
back-hauling commodities. Is my understanding correct? Please formulate your
answers in the form of an advisory opinion. Also, in your "opinion",
please indicate if you agree that a carrier back-hauling monthly for hire,
would be considered doing so on a "regular" basis.
We
have a client that would rather not set up a separate transportation company in
order to qualify for this exemption under the present TC-767 form requirements.
They operate trucks and pull tankers and trailers throughout the western states
and often back-haul products for various other companies.
A
timely response will be appreciated.
Very
truly yours,
XXXXX
XXXXX,
Consultant