Title: Renaissance Management Co. v. Commissioner of Revenue Services

State: connecticut

Issuer: Connecticut Supreme Court

Document:

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RENAISSANCE MANAGEMENT COMPANY, INC. v.
COMMISSIONER OF REVENUE SERVICES
(SC 16984)
Sullivan, C. J., and Borden, Katz, Palmer and Zarella, Js.
Argued October 23—officially released December 30, 2003
Robert J. Percy, for the appellant (plaintiff).
Philip Miller, assistant attorney general, with whom
were Louis P. Bucari, Jr., and, on the brief, Richard
Blumenthal, attorney general, and Jonathon L. Ensign,
assistant attorney general, for the appellee (defendant).
Opinion
PER CURIAM. The plaintiff, Renaissance Manage-
ment Company, Inc., appeals,1 pursuant to General Stat-
utes § 12-422,2 from the judgment of the trial court,
which dismissed its appeal from the determination
by the defendant, the commissioner of revenue ser-
vices, that during the audit period of October 1, 1993,
through September 30, 1996, the plaintiff was not
exempt from sales and use taxes on gross receipts
derived from the furnishing of property management
services. The plaintiff claims that the trial court
improperly determined that it had failed to satisfy its
burden of proving that the exemption described
in General Statutes (Rev. to 1993) § 12-407 (8)3
and (9)4 includes the separately stated expenses of
employees who are not located at, and who do not
solely devote their time to, a single housing project.
Our examination of the record and briefs and our
consideration of the arguments of the parties persuade
us that the judgment of the trial court should be
affirmed. The issues were resolved properly in the trial
court’s concise and well reasoned memorandum of
decision. Renaissance Management Co. v. Commis-
sioner of Revenue Services, 48 Conn. Sup. 221,
A.2d
(2002). Because that memorandum of decision fully
addresses all arguments raised in this appeal, we adopt
it as a proper statement of the issues and the applicable
law concerning those issues. It would serve no useful
purpose for us to repeat the discussion contained
therein. See Davis v. Freedom of Information Commis-
sion, 259 Conn. 45, 55–56, 787 A.2d 530 (2002).
The judgment is affirmed.
1 The plaintiff appealed from the judgment of the trial court to the Appellate
Court, and we transferred the appeal to this court pursuant to General
Statutes § 51-199 (c) and Practice Book § 65-1.
2 General Statutes § 12-422 provides: ‘‘Any taxpayer aggrieved because of
any order, decision, determination or disallowance of the Commissioner of
Revenue Services under section 12-418, 12-421 or 12-425 may, within one
month after service upon the taxpayer of notice of such order, decision,
determination or disallowance, take an appeal therefrom to the superior
court for the judicial district of New Britain, which shall be accompanied
by a citation to the Commissioner of Revenue Services to appear before
said court. Such citation shall be signed by the same authority, and such
appeal shall be returnable at the same time and served and returned in the
same manner, as is required in case of a summons in a civil action. The
authority issuing the citation shall take from the appellant a bond or recogni-
zance to the state of Connecticut, with surety to prosecute the appeal to
effect and to comply with the orders and decrees of the court in the premises.
Such appeals shall be preferred cases, to be heard, unless cause appears
to the contrary, at the first session, by the court or by a committee appointed
by it. Said court may grant such relief as may be equitable and, if such tax
has been paid prior to the granting of such relief, may order the Treasurer
to pay the amount of such relief, with interest at the rate of two-thirds of
one per cent per month or fraction thereof, to the aggrieved taxpayer. If
the appeal has been taken without probable cause, the court may tax double
or triple costs, as the case demands; and, upon all such appeals which are
denied, costs may be taxed against the appellant at the discretion of the
court, but no costs shall be taxed against the state.’’
3 General Statutes (Rev. to 1993) § 12-407 (8) provides in relevant part:
‘‘ ‘Sales price’ means the total amount for which tangible personal property
is sold, the total amount of rent received for occupancy or the total amount
received for any service rendered on or after July 1, 1975, or the total amount
of payment or periodic payments received for leasing or rental of tangible
personal property for the term of any such lease or rental occurring on or
after July 1, 1975, valued in money, whether paid in money or otherwise,
without any deduction on account of any of the following: (a) The cost of
the property sold; (b) the cost of materials used, labor or service cost,
interest charged, losses or any other expenses; (c) the cost of transportation
of the property prior to its purchase. Such total amounts include all of the
following: (a) Any services that are a part of the sale; (b) any amount for
which credit is given to the purchaser by the seller; (c) all compensation
and all employment related expenses, whether or not separately stated,
paid to or on behalf of employees of a retailer of any service described in
subdivision (i) of subsection (2) of this section. ‘Sales price’ does not include
any of the following . . . (f) the amount charged for separately stated com-
pensation, fringe benefits, workers’ compensation and payroll taxes or
assessments paid to or on behalf of employees of a retailer who has con-
tracted to manage a service recipient’s property or business premises and
renders management services described in subdivision (i) of subsection (2)
of this section, provided (A) the employees perform such services solely
for the service recipient at its property or business premises and (B) ‘sales
price’ shall include the separately stated compensation, fringe benefits,
workers’ compensation and payroll taxes or assessments paid to or on
behalf of any employee of the retailer who is an officer, director or owner
of more than five per cent of the outstanding capital stock of the retailer.
Determination whether an employee performs services solely for a service
recipient at its property or business premises for purposes of this subdivision
shall be made by reference to such employee’s activities during the time
period beginning on the later of the commencement of the management
contract, the date of the employee’s first employment by the retailer or the
date which is six months immediately preceding the date of such determi-
nation.’’
General Statutes (Rev. to 1993) § 12-407 (2) provides in relevant part:
‘‘ ‘Sale’ and ‘Selling’ mean and include . . . (i) the rendering of certain
services for a consideration . . . as follows . . . (I) services to industrial,
commercial or income-producing real property, including but not limited
to, such services as management . . . provided income-producing property
shall not include property used exclusively for residential purposes in which
the owner resides and which contains no more than three dwelling units,
or a housing facility for low and moderate income families and persons
owned by an organization which has as one of its purposes the ownership
of housing for low and moderate income families, and which organization
has been granted exemption from federal income taxation . . . .’’
4 General Statutes (Rev. to 1993) § 12-407 (9) provides in relevant part:
‘‘ ‘Gross receipts’ means the total amount of the sales price, of the retail
sales of retailers, or the total amount of the rent received for occupancy
or the total amount received for any service rendered on or after July 1,
1975, or the total amount of payment or periodic payments received for
leasing or rental of tangible personal property for the term of any such lease
or rental occurring on or after July 1, 1975, valued in money, whether
received in money or otherwise, without any deduction on account of any
of the following: (a) The cost of the property sold; however, in accordance
with such regulations as the commissioner of revenue services may pre-
scribe, a deduction may be taken if the retailer has purchased property for
some other purpose than resale, has reimbursed his vendor for tax which
the vendor is required to pay to the state or has paid the use tax with respect
to the property, and has resold the property prior to making any use of the
property other than retention, demonstration or display while holding it for
sale in the regular course of business. If such a deduction is taken by the
retailer, no refund or credit will be allowed to his vendor with respect to
the sale of the property; (b) the cost of the materials used, labor or service
cost, interest paid, losses or any other expense; (c) the cost of transportation
of the property prior to its sale to the purchaser. The total amount of the
sales price includes all of the following: (a) Any services that are a part of
the sale; (b) all receipts, cash, credits and property of any kind; (c) any
amount for which credit is allowed by the seller to the purchaser; (d)
all compensation and all employment related expenses, whether or not
separately stated, paid to or on behalf of employees of a retailer of any
service described in subdivision (i) of subsection (2) of this section. ‘Gross
receipts’ do not include any of the following . . . (f) the amount charged
for separately stated compensation, fringe benefits, workers’ compensation
and payroll taxes or assessments paid to or on behalf of employees of a
retailer who has contracted to manage a service recipient’s property or
business premises and renders management services described in subdivi-
sion (i) of subsection (2) of this section, provided (A) the employees perform
such services solely for the service recipient at its property or business
premises and (B) ‘gross receipts’ shall include the separately stated compen-
sation, fringe benefits, workers’ compensation and payroll taxes or assess-
ments paid to or on behalf of any employee of the retailer who is an officer,
director or owner of more than five per cent of the outstanding capital stock
of the retailer. Determination whether an employee performs services solely
for a service recipient at its property or business premises for purposes of
this subdivision shall be made by reference to such employee’s activities
during the time period beginning on the later of the commencement of the
management contract, the date of the employee’s first employment by the
retailer or the date which is six months immediately preceding the date of
such determination.’’