Opinion ID: 663173
Heading Depth: 3
Heading Rank: 2

Heading: Intangible Tax

Text: 19 Rodash paid the appellees a $204 Florida intangible tax on the Note securing the loan. 9 AIB included this tax in the amount financed rather than the finance charge. Because the intangible tax is a charge payable by the consumer directly or indirectly ... as an incident to the extension of credit, it is a finance charge, unless it falls within an exclusion. Given that state intangible taxes are not specifically excluded, the only potentially relevant exclusions are as follows: 20 (1) A tax imposed by a state ... on the credit transaction that is payable by the consumer (even if the tax is collected by the creditor) when the charge is imposed on the consumer by someone other than the creditor. F.R.B. Commentary on 12 C.F.R. Sec. 226.4(a), Comment 3, reprinted in 12 C.F.R. pt. 226, Supp. I; 21 (2) [c]harges for filing or recording security agreements, mortgages, ... and similar documents. F.R.B. Commentary on 12 C.F.R. Sec. 226.4(e), Comment 12, reprinted in 12 C.F.R. Pt. 226, Supp. I; and 22 (3) [t]axes and fees prescribed by law that actually are or will be paid to public officials for ... perfecting ... a security interest. 12 C.F.R. Sec. 226.4(e)(1). 23 We hold that the Florida tax should have been included in the finance charge because it was a charge paid by the consumer directly for the extension of credit and no exclusion applies. First, the plain language of TILA evinces no explicit exclusion of an intangible tax from the finance charge. Second, the intangible tax does not fall under the first listed exclusion because it is imposed on the creditor--not the consumer--for holding the Note, an intangible asset. See Fla.Stat.Ann. Sec. 199.135(1) (West 1989) (nonrecurring tax is imposed on person recording note); First Nat'l Bank v. Department of Revenue, 364 So.2d 38, 39 (Fla.Dist.Ct.App.1978) (noting that intangible property tax is assessed against creditor), appeal dismissed, 368 So.2d 1366 (Fla.1979) (Table, No. 55880). 10 Third, contrary to the appellees' contention, the intangible tax does not fall under the second exclusion because it is not a recording fee; rather, recording fees are imposed under a wholly different statute. See Fla.Stat.Ann. Sec. 28.24 (West 1988) (setting charge for recording fees). Finally, the purpose of the tax is most likely revenue enhancement, not perfection of a security interest, which concerns the proper recordation of the instrument, and therefore the third exclusion is equally inapplicable. Thus, the Florida intangible tax was improperly excluded from the TILA finance charge, and Rodash had the legal right to rescind the transaction in December 1991. 11