94-027
Response
November 16, 1994
ATTN JOE B PACHECO
COMMISSIONER
UTAH STATE TAX COMMISSION
160 EAST THIRD SOUTH
SALT LAKE CITY UT
84134
Dear Mr. Pacheco:
This represents our
formal request for declaratory judgment pending positive advisory opinion from
the Tax Commission's Auditing Division. Under the exclusion rule in 59-12-104
Exemptions Utah Tax Code 1991-92 (Sales and Use Tax Rule A-12-02-S85),
exemption is requested for the following capital project:
PROJECT AMOUNT REF. NO.
XXXXX $$$$$ XXXXX
Current funding is for
$$$$$ as shown on the attached project data sheets. The molding/extrusion,
manual assembly, and other assembly equipment represents purchase of equipment
for use in new or expanding operations and excludes normal operating
replacements. This is a new product line being launched. This is necessary
for XXXXX to establish a strong market presence in the fast growing safety
catheter market.
If you feel further
explanation and documentation is necessary, please contact me at XXXXX. I can
meet with you, at your convenience, at your office or our Sandy, Utah facility.
Sincerely,
XXXXX
cc: XXXXX
Re:
Declaratory Judgment, Manufacturer's Machinery Exemption
Dear XXXXX:
This letter is in
response to your recent request for the Tax Commission to issue a declaratory judgment
that your intended machinery and equipment purchases qualify for exemption from
sales or use tax under the provisions of Utah Code Section 59-12-104(15) and
Administrative Rule R865-19S-85.
Although your inquiry
was framed as a request for a declaratory judgment, Tax Commission policy is to
initially treat all such inquiries as requests for advisory opinions. Our reach
indicates as follows:
1. It is understood that the request and
this opinion are written only with regard to the current funding, not to the
entire $$$$$ project.
2. Current Funding, XXXXX, $$$$$ - The
portions of the project listed on the page submitted with your request entitled
“Equipment and Tooling for XXXXX” generally appear to meet established criteria
for exemption. An exception is the item listed as “Facility Modification” for
$$$$$. This part of the project involves modification to the real property and
is, therefore, not eligible for exemption. Otherwise, the items for which you
seek approval qualify for the exemption.
This opinion is based
upon the facts presented in your letter. Obviously, if there are deviations
from these facts, this opinion may be negated.
If you do not agree
with this determination, you may appeal to the Tax commission for a formal
hearing. The results of that hearing would constitute a declaratory judgment
and be appealable to the Utah State Supreme Court. A notice of Appeal Rights
and a copy of the Utah Taxpayer Bill of Rights are attached.
For the Commission,
Alice Shearer