Opinion ID: 1771648
Heading Depth: 1
Heading Rank: 5

Heading: Definition of use

Text: Citing Connally v. General Construction Co., 269 U.S. 385, 46 S.Ct. 126, 70 L.Ed. 322 (1926), plaintiff argues the Mississippi Use Tax Law's definition of use is unconstitutionally vague because it provides no standard for application. Section 27-67-3(k), which sets forth the challenged definition, reads in full as follows: (k) Use or consumption means the first use or intended use within this state of tangible personal property and shall include rental or loan by owners or use by lessees or other persons receiving benefits from use of the property. Use or consumption shall include the benefit realized or to be realized by persons importing or causing to be imported into this state tangible advertising or sales promotion materials. More specifically, plaintiff contends the statutory term benefit realized is impermissibly vague, for which reason the use tax is computed on a cost basis even though cost bears no reasonable or necessary correlation to the benefit realized. Plaintiff's vagueness challenge presumably arises from the protection against state deprivation of property without due process of law found in the United States Constitution's Fourteenth Amendment. The standards for evaluating such a challenge hive been summarized as follows: Vague laws offend several important values. First, because we assume that man is free to steer between lawful and unlawful conduct, we insist that laws give the person of ordinary intelligence a reasonable opportunity to know what is prohibited, so that be may act accordingly. Vague laws trap the innocent by not providing fair warning. Second, if arbitrary and discriminatory enforcement is to be prevented, laws must provide explicit standards for those who apply them. A vague law impermissibly delegates basic policy matters to policemen, judges, and juries for resolution on an ad hoc and subjective basis, with the attendant dangers of arbitrary and discriminatory applications. Village of Hoffman Estates v. Flipside Hoffman Estates, Inc., 455 U.S. 489, 102 S.Ct. 1186, 71 L.Ed.2d 362 (1982) (quoting Grayned v. City of Rockford, 408 U.S. 104, 92 S.Ct. 2294, 33 L.Ed.2d 222 (1972)). In applying these standards, the degree of vagueness that the Constitution tolerates depends on the nature of the challenged statute. Village of Hoffman Estates, 455 U.S. 489, 102 S.Ct. 1186, 71 L.Ed.2d 362. In the present case, the challenged legislation regulates business behavior. Economic legislation is subject to a less-strict vagueness test, in part, because businesses can be expected to plan behavior carefully and consult relevant legislation in advance of action. Id. This Court concludes that section 27-67-3(k), in its entirety, is not unconstitutionally vague and affords a person of ordinary intelligence a reasonable opportunity to know that importation of tangible advertising materials into Mississippi may constitute a taxable event for use-tax purposes. Further, plaintiff's argument is unpersuasive that the use tax is computed on a cost basis because the term benefit realized is unconstitutionally vague. As previously noted, the measure of the use-tax base is clearly defined elsewhere in the Mississippi Use Tax Law, specifically section 27-67-5(a) and the attendant definitional sections 27-67-3(f) and (h).