95-057
Responses July 17, 1995 and September 6, 1995
Request
Roger O. Tew, Commissioner
Utah State Tax Commission
210 North 1950 West
Salt Lake City, UT 84134
Dear Mr. Tew:
We have a client who is a mobile home dealer, and was impacted by the
recent change in the legislation with regards to the sales tax on mobile
homes. We would like clarification in
writing as to the state's position on the effective date of this legislation. Specifically, we are wondering if an order
was drawn up and funds (either partial or in full) were received on a
transaction prior to XXXXX, but the transaction was not actually closed until
after XXXXX what sales tax rate should be charged.
Sincerely,
XXXXX
XXXXX
RE: Advisory Opinion -
Retroactivity of Sales Tax Exemption on Mobile Homes
Dear XXXXX,
You asked Commissioner Oveson to consider applying the new mobile home
sales tax exemption retroactively to people who purchased mobile homes prior to
the exemption. Apparently some mobile
home owners neglect to properly register their mobile homes in order to avoid
sales tax on the purchase of a mobile home.
We know that improperly registered mobile homes cause problems with
your property records, and we want to help. However, this particular request is
beyond our authority. The legislature,
in enacting the exemption, specifically set XXXXX as the effective date. We cannot override the legislature's
directive by applying the statute retroactively.
If we can help you in some other way, please let us know.
Sincerely,
Alice Shearer
Commissioner
XXXXX
RE: Advisory Opinion - Effective date of the
sales tax exemption for mobile homes.
Dear
XXXXX,
We
have received your request for information about the effective date of Senate
Bill 289 which extends a 45% sales tax exemption to sales of new mobile homes
and a 100% exemption to sales of used mobile homes. Senate Bill 289 carries an effective date of July 1, 1995. To qualify for the exemption, the sale must
have occurred on or after that date. Unless otherwise explicitly stated in the
sales contract, we consider the sale to be complete when title passes. As a rule, title passes when the seller
completes his performance with regard to delivery.
It
is possible that your client has been involved in transactions that overlapped
the effective date of this exemption. That is, a buyer entered into a sales
agreement for the mobile home before July 1, 1995, but the contract obligated
the dealer to deliver the mobile home to a site selected by the purchaser after
July 1. In such a case, the Commission
would consider the sale to be complete when the buyer takes delivery and
assumes the risk of loss for the mobile home.
If the buyer assumed the risk upon entering the sales contract, the sale
was complete before the effective date of the exemption and sales tax is
due. If the buyer assumed the risk upon
delivery of the mobile home, the sale was completed after the effective date of
the exemption and the exemption applies.
This
opinion is based only the facts presented in your letter. If additional facts arise which present new
questions, please feel free to request another advisory opinion.
For
the Commission,
Alice
Shearer
Commissioner