Court Opinion

ID: 9513592
Source: CourtListenerOpinion
Date Created: 2023-08-06 22:38:14.808509+00
Date Added: 2024-06-11T09:05:55.912733
License: Public Domain

*199MARING, Justice.
[¶ 1] American West Community Promotions, Inc. appeals from a district court judgment affirming an order of the North Dakota State Tax Commissioner which held American West liable for $20,883.51 in sales tax. We reverse the decision of the district court and remand to the Tax Commissioner for further proceedings consistent with this opinion.
I
[¶ 2] American West Community Promotions, Inc. (“American West”) is an advertising and marketing firm that represents approximately 400 retail, food, and service merchants in North Dakota. American West produces promotional coupon books on behalf of its clients and markets the books in various ways, including radio ads, newspaper ads, direct mail, and through a promotional telephone campaign. The books sell for $43.95 each and contain coupons entitling the coupon holders to a variety of discounts and free products and services from participating merchants. In September of 1999, the State, by and through its Tax Commissioner (“Commissioner”), conducted a sales and use tax audit of American West. As a result of the audit, the Commissioner concluded American West had made taxable sales of its coupon books in North Dakota, but failed to pay sales tax. American West challenged this conclusion and requested an administrative hearing.
[¶ 3] At the administrative hearing, American West argued its coupon books are not tangible personal property and, thus, not subject to sales tax under N.D.C.C. § 57-39.2-02.1. Furthermore, American West argued the Commissioner exceeded statutory authority in promulgating N.D. Admin. Code § 81-04.1-01-28, which provides that sales of coupon books are taxable as sales of tangible personal property.
[¶ 4] The Administrative Law Judge (“ALJ”) rejected American West’s argument and concluded it was liable for $20,883.51 in sales tax to the state of North Dakota. The Commissioner issued an order adopting the ALJ’s recommended findings of fact and conclusions of law on February 1, 2001. American West appealed the Commissioner’s order to the district court on February 28, 2001. On July 13, 2001, the district court issued a judgment which affirmed the Commissioner’s order, and American West appealed to this Court.
II
[¶5] Our review of a decision by an administrative agency is governed by N.D.C.C. § 28-32-19. See Ringsaker v. Director, N.D. Dept. of Transp., 1999 ND 127, ¶ 5, 596 N.W.2d 328. We limit our review to the record before the administrative agency, and we do not review the decision of the district court. See id. Section 28-32-19, N.D.C.C., requires us to affirm the agency’s decision unless:
1) a preponderance of the evidence does not support the agency’s findings; 2) the agency’s findings of fact do not support its conclusions of law and its decision; 3) the agency’s decision violates the constitutional rights of the appellant; 4) the agency did not comply with the Administrative Agencies Practice Act in its proceedings; 5) the agency’s rules or procedures have not afforded the appellant a fair hearing; or 6) the agency’s decision is not in accordance with the law.
Dworshak v. Moore, 1998 ND 172, ¶ 6, 583 N.W.2d 799 (quoting Greenwood v. Moore, 545 N.W.2d 790, 793 (N.D.1996)).1
*200III
[¶ 6] American West argues the Commissioner erred in concluding it was liable for sales tax because when it sells a coupon book it is not selling tangible personal property, but the intangible right to receive discounts from its clients. The Commissioner responds that the issue in this case is not whether the coupon books are tangible or intangible property, but whether the Commissioner’s act in promulgating N.D. Admin. Code § 81-04.1-01-28 was beyond the scope of the Commissioner’s statutory authority.
[¶ 7] The issue of whether the Commissioner correctly interpreted a statute is a question of law which is fully reviewable by this Court on appeal. See Northern X-Ray Co., Inc. v. State ex rel. Hanson, 542 N.W.2d 733, 735 (N.D.1996).2 The Commissioner’s interpretation of a statute is entitled to some deference if it does not contradict clear and unambiguous statutory language. See Consol. Tel. v. Western Wireless Corp., 2001 ND 209, ¶ 7, 637 N.W.2d 699; Rocky Mountain Oil & Gas Ass’n v. Conrad, 405 N.W.2d 279, 283 (N.D.1987). When the statute at issue is complex and technical in nature, this deference is appreciable, and we will be reluctant to substitute our interpretation for the Commissioner’s interpretation. See Consol. Tel, at ¶ 7; NL Indust., Inc. v. N.D. State Tax Comm’r, 498 N.W.2d 141, 146 (N.D.1993). However, an administrative agency’s construction of a statute is accorded much less weight when the only issue to be resolved by a court is a nontechnical question of law. See 2B Norman J. Singer, Statutes and Statutory Construction § 49:04, 24 (6th ed. 2000 Rev.); see also Kansas Power and Light Co. v. State Corp. Commission, 237 Kan. 394, 699 P.2d 53, 56 (1985) (stating that deference to administrative agency interpretations is not required where the issue “is not tech*201nical, but statutory construction of a question of law”); Matter of Dworman v. N.Y. State Div. of Housing & Community Renewal, 94 N.Y.2d 359, 704 N.Y.S.2d 192, 725 N.E.2d 613, 619 (1999) (“[W]here, as here, the question is one of pure statutory interpretation dependent only on accurate apprehension of legislative intent, there is little basis to rely on any special competence or expertise of the administrative agency and its interpretive regulations are therefore to be accorded much less weight.” (citation omitted) (internal quotation marks omitted)).
[¶8] The issue in this case is whether the Commissioner correctly interpreted the phrase “[t]angible personal property, consisting of goods, wares, or merchandise.” See N.D.C.C. § 57-39.2-02.1(l)(a). The interpretation of this phrase is a matter of pure statutory interpretation and presents a nontechnical question of law. See Northern X-Ray Co., 542 N.W.2d at 738 (rejecting the Commissioner’s interpretation of the word “contractor”). Thus, the issue in this case does not involve such complex and technical matters as to warrant an appreciable level of deference to the Commissioner’s interpretation. See, e.g., Kinney Shoe Corp. v. State ex rel. Hanson, 552 N.W.2d 788, 790 (N.D.1996) (Commissioner’s conclusion that inter-company transfers which reduce federal tax liability are not part of a subsidiary’s state tax deduction was entitled to appreciable deference); NL Indust., Inc., 498 N.W.2d at 146-47 (Commissioner’s method for treating net operating losses of a multi-state corporation was entitled to appreciable deference); Western Gas Resources, Inc. v. Heitkamp, 489 N.W.2d 869, 872 (N.D.1992) (Commissioner’s determination that field condensate recovered from natural gas was oil within the meaning of the oil extraction tax was entitled to appreciable deference).
[¶ 9] An administrative agency’s interpretation of a statute is also entitled to additional weight if the Legislature reenacts the statute after a contemporaneous and continuous construction of the statute by an administrative agency. See Schmutzler v. Workmen’s Comp. Bureau, 78 N.D. 377, 49 N.W.2d 649, 652 (1951); Payne v. Bd. of Trustees of the Teachers’ Ins. & Ret. Fund, 76 N.D. 278, 35 N.W.2d 553, 557-58 (1948). In Payne, this Court discussed the deference that should be given to an agency’s contemporaneous and continuous interpretation of a statute when the Legislature reenacts the statute subsequent to the interpretation:
It is not disputed that [the agency’s interpretation] has been the administrative practice since the adoption of the law. During that time the legislature has met in many sessions and made several amendments to the law but none in regard to this procedure. There is at least a strong presumption that the legislature knew and approved the contemporaneous and practical construction placed upon the [statute] by the officers charged with its administration.
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“Executive construction is entitled to additional weight where it has been impliedly indorsed by the legislature, as by the reenactment of the statute or the passage of a similar one, in the same or substantially the same terms,.... ”
See Payne, at 557-58. Similarly, in Schmutzler, this Court stated:
Following the codification and the enactment of [the statute], and its reenactment ... the Workmen’s Compensation Bureau continued the interpretation of this Act in accordance with the limitations set out in Chapter 260, S.L.1929. The Bureau treated the statute as unchanged. The practical and contemporaneous construction placed upon the *202statute by the officers charged with its enforcement may be considered in determining the meaning of the law.
Schmutzler, at 652.
[¶ 10] The Legislature has reenacted N.D.C.C. § 57-39.2-02.1 four times since the Commissioner amended N.D. Admin. Code § 81-04.1-01-28 in 1989 to provide for the taxation of sales of coupon books as sales of tangible personal property. However, the 1989 amendments to N.D. Admin. Code § 81-04.1-01-28 were promulgated 54 years after the Legislature first applied the sales tax to sales of “[t]angible personal property, consisting of goods, wares, or merchandise.” See 1935 N.D. Sess. Laws ch. 276, § 2 (applying the sales tax to sales of “tangible personal property, consisting of goods, wares, or merchandise,”). Thus, unlike the administrative interpretations at issue in Payne and Schmutzler, we are not concerned with a contemporaneous construction of a statute. See Payne, 35 N.W.2d at 557 (“It is not disputed that [the agency’s interpretation] has been the administrative practice since the adoption of the law.”); Schmutzler, 49 N.W.2d at 652 (“Following the codification and the enactment of [the statute], and its reenactment ... the Workmen’s Compensation Bureau continued the interpretation of this Act in accordance with the limitations set out in Chapter 260, S.L.1929.”); see also Singer, supra § 49:08, 101 (“A contemporaneous interpretation is one made at or soon after the time of enactment.”). Nor are we concerned with a continuous agency interpretation in this case because between the years 1984 and 1989, there was no administrative rule providing for the taxation of sales of coupon books, and prior to 1984, sales of coupon books were taxed only when such books were “sold by persons engaged in selling taxable commodities or services.” See N.D. Admin. Code § 81-04-02-71.2 (repealed June 1, 1984); see also N.D. Admin. Code § 81-04.1-01-28 (Oct. 1986). Thus, the rule established in Payne and Schmutzler is afforded much less weight in this case. See Singer, supra § 49:08, 103 (“[T]he rules that an administrative interpretation of an act is entitled to controlling weight may not be invoked where the interpretation was neither continuous nor contemporaneous with the enactment of the statute.”); see also Singer, supra § 49:04, 24 (listing proximity in time to the enactment of the statute as a factor bearing on the conclusiveness of the agency’s interpretation of the statute).
[¶ 11] The reenactment doctrine is also afforded less weight in this case because there is nothing in the legislative history of N.D.C.C. § 57-39.2-02.13 or in the record *203before this Court to indicate the Legislature considered the 1989 amendments to N.D. Admin. Code § 81-04.1-01-28 during any of the reenactments of N.D.C.C. § 57-39.2-02.1. See Singer, supra § 49:09, 109-10 (“[The reenactment doctrine] does not apply where nothing indicates that the legislature had its attention directed to the administrative interpretation upon reenactment. Where there is no indication of the extent to which the practical construction was followed, the rule has questionable value”) (footnotes omitted).4
[¶ 12] Nonetheless, we have held, through the doctrine of legislative acquiescence, that even inaction on the part of the Legislature subsequent to an agency interpretation of a statute entitles the agency’s interpretation to additional weight. See Eklund v. Eklund, 588 N.W.2d 182, 188 (N.D.1995) (legislature is presumed to know the construction of its statutes and acquiesces in that construction if it fails to offer any amendments); Capital Electric Coop., Inc. v. Public Service Comm’n, 534 N.W.2d 587, 592 (N.D. 1995) (same); Effertz v. N.D. Workers Comp. Bureau, 525 N.W.2d 691, 693 (N.D. 1994); Northern States Power Co. v. Board of R.R. Comm’rs, 71 N.D. 1, 298 N.W. 423, 430 (1941) (“And 'in construing a statute of doubtful meaning the court will give weight to the long-continued practical construction placed thereon by officers charged with the duty of executing and applying the statute,’ to the judicial construction of such statute by an inferior court, and to the legislative acquiescence in both the departmental and judicial construction.” (citations omitted)). Nevertheless, the reenactment doctrine and legislative acquiescence are merely aids in statutory interpretation and can be overridden by more compelling considerations. See Northern X-Ray, 542 N.W.2d *204at 738 (“[W]e will not defer to even a longstanding agency interpretation that is contrary to the intent of the legislature.”); Payne, 35 N.W.2d at 558 (“Executive construction is entitled to additional weight where it has been impliedly indorsed by the legislature, as by the reenactment of the statute or the passage of a similar one, in the same or substantially the same terms, .... ” (emphasis added)); Schmut-zler, 49 N.W.2d at 652 (“The practical and contemporaneous construction placed upon the statute by the officers charged with its enforcement may be considered in determining the meaning of the law.” (emphasis added)); Singer, supra § 49:07, 99 (stating that an agency’s long-standing interpretation can be overridden by more compelling considerations).
[¶ 13] Having addressed the weight afforded to the Commissioner’s interpretation of N.D.C.C. § 57-39.2-02.1(1), we now turn to the statute itself. Section 57-39.2-02.1(1), N.D.C.C., lists the types of transactions that are subject to sales tax:
1. Except as otherwise expressly provided in subsection 2 for sales of mobile homes used for residential or business purposes; for sales of farm machinery, farm machinery repair parts, and irrigation equipment used exclusively for agricultural purposes; and except as otherwise expressly provided in this chapter, there is imposed a tax of five percent upon the gross receipts of retailers from all sales at retail including the leasing or renting of tangible personal property as provided in this section, within this state of the following to consumers or users:
a.Tangible personal property, consisting of goods, wares, or merchandise, except mobile homes used for residential or business purposes and farm machinery, farm machinery repair parts, and irrigation equipment used exclusively for agricultural purposes.
b. The furnishing or service of communication services or steam other than steam used for processing agricultural products.
c. Tickets or admissions to places of amusement or entertainment or athletic events, including amounts charged for participation in an amusement, entertainment, or athletic activity, and including the furnishing of bingo cards and the playing of any machine for amusement or entertainment in response to the use of a coin. The tax imposed by this section applies only to eighty percent of the gross receipts collected from coin-operated amusement devices.
d. Magazines and other periodicals.
e. The leasing or renting of a hotel or motel room or tourist court accommodations.
f. The leasing or renting of tangible personal property the transfer of title to which has not been subjected to a retail sales tax under this chapter or a use tax under chapter 57-40.2.
g. Coal mined in this state and used for heating buildings, except for coal used in agricultural processing or sugar beet refining plants.
N.D.C.C. § 57-39.2-02.1(1). Nowhere in section 57-39.2-02.1(1) is there any reference to coupons or coupon books. Section 81-04.1-01-28, N.D. Admin. Code, provides in part, “[s]ales of coupons, coupon books, and other certificates which entitle the holder to a discount or other price advantage on the purchase of goods or services, whether or not the goods or services are subject to sales or use tax, are taxable as sales of tangible personal property.” Thus, in enacting N.D. Admin. Code § 81-04.1-01-28, the Commissioner did not merely explain a procedure for *205applying the sales tax to sales of coupon books, but concluded that sales of coupon books constituted sales of “[t]angible personal property, consisting of goods, wares, or merchandise,” under N.D.C.C. § 57-39.2-02.1(l)(a). If sales of coupons books do not constitute sales of “[tjangible personal property, consisting of goods, wares, or merchandise,” such an action on the part of the Commissioner would amount to an unauthorized amendment of N.D.C.C. § 57-39.2-02.1(1). As we explained in Moore v. N.D. Workmen’s Comp. Bureau:
Since the power to make regulations is administrative in nature, legislation may not be enacted under the guise of its exercise by issuing a “regulation” which is out of harmony with, or which alters, extends, or limits, the statute being administered, or which is inconsistent with the expression of the lawmakers’ intent in other statutes. The administrative officer’s power must be exercised within the framework of the provision bestowing regulatory powers on him and the policy of the statute which he administers. He cannot initiate policy in the true sense, but must fundamentally pursue a policy predetermined by the same power from which he derives his authority.
374 N.W.2d 71, 74 (N.D.1985) (quoting Med. Properties v. N.D. Board of Pharm., 80 N.W.2d 87, 90 (N.D.1956)). A regulation which exceeds the Commissioner’s statutory authority or conflicts with the statute that it implements is void. See Little v. Traynor, 1997 ND 128, ¶ 30, 565 N.W.2d 766; Little v. Tracy, 497 N.W.2d 700, 704 (N.D.1993). Thus, the determination of whether the Commissioner exceeded statutory authority in promulgating a rule which taxes sales of coupon books as sales of tangible personal property necessarily turns on the resolution of the issue of whether sales of coupon books constitute sales of tangible personal property under N.D.C.C. § 57-39.2-02.1(l)(a).
[¶ 14] Our primary goal in statutory construction is to ascertain the intent of the Legislature. See Western Gas Resources, 489 N.W.2d at 872. In ascertaining the Legislature’s intent, we first look to the plain language of the statute and give each word of the statute its ordinary meaning. See Estate of Thompson, 1998 ND 226, ¶ 7, 586 N.W.2d 847. We construe the statute as a whole and give effect to each of its provisions if possible. Id. If the language of the statute is clear and unambiguous, we cannot ignore that language under the pretext of pursuing its spirit because the legislative intent is presumed clear from the face of the statute. Id. However, if the language of a statute is ambiguous, we may resort to extrinsic aids to interpret the statute. Id. “[I]f a tax statute is ambiguous so that the legislative intention with respect to the meaning of the statute is doubtful, the doubt must be resolved in favor of the taxpayer.” Rocky Mountain Oil, 405 N.W.2d at 281.
[¶ 15] In regard to tangible personal property, the plain language of N.D.C.C. § 57-39.2-02.1(1) provides:
[T]here is imposed a tax of five percent upon the gross receipts of retailers from all sales at retail including the leasing or renting of tangible personal property as provided in this section, within this state of the following to consumers or users:
a. Tangible personal property, consisting of goods, wares, or merchandise ....
The Legislature has not, however, defined the phrase “[t]angible personal property, consisting of goods, wares, or merchandise,” as used in N.D.C.C. § 57-39.2-02.1(l)(a).
[¶ 16] The Legislature has provided a definition of “tangible personal property” *206for North Dakota’s use tax statutes. As used in ch. 57-40.2, N.D.C.C.:
“Tangible personal property” means:
a. Tangible goods, including the furnishing of bingo cards, wares, and merchandise, and gas, when furnished or delivered to consumers or users within this state, and the sale of vulcanizing, recapping, and retreading services for tires.
b. The leasing or renting of tangible personal property, the sale, storage, use, or consumption of which has not been previously subjected to a retail sales or use tax in this state.
c. The purchase of magazines or other periodicals. Provided, the words “magazines and other periodicals” as used in this subdivision do not include newspapers nor magazines or periodicals that are furnished free by a nonprofit corporation or organization to its members or because of payment by its members of membership fees or dues.
d. The severance of sand or gravel from the soil.
N.D.C.C. § 57-40.2-01(8). This definition, however, is of little help to us in this case because the only portion of the definition that could possibly include coupon books is the phrase “tangible goods.” See N.D.C.C. § 57-40.2-01(8)(a). Thus, even if we were to rely on this definition, it would be necessary for us to interpret the phrase “tangible goods” of N.D.C.C. § 57-40.2 — 01(8)(a), just as it is necessary for us to interpret the phrase “[tjangible personal property, consisting of goods, wares, or merchandise,” of N.D.C.C. § 57-39.2-02.1(l)(a).
[¶ 17] The phrase “tangible personal property” literally means “[cjorporeal personal property of any kind; personal property that can be seen, weighed, measured, felt, or touched, or is in any way perceptible to the senses.” See Black’s Law Dictionary 1234 (7th ed.1999); see also Bismarck Tribune Co. v. Omdahl, 147 N.W.2d 903, 906 (N.D.1966) (stating that tangible personal property is “personal property that can be touched or handled”). Thus, N.D.C.C. § 57-39.2-02.1(l)(a) could be literally construed to subject every transaction in which the transfer of personal property that can be touched or handled occurs to sales tax. However, the question of whether an item falls within the literal definition of tangible personal property is distinct from the question of whether a taxable sale of tangible personal property has taken place. For example, items such as promissory notes and stock certificates clearly fall within the literal definition of tangible personal property; however, for taxation purposes, such items are generally regarded as intangible property because their value is derived from the intangible rights they represent. See Navistar Int’l Transp. Corp. v. State Board of Equalization, 8 Cal.4th 868, 35 Cal.Rptr.2d 651, 884 P.2d 108, 110 (1994). Thus, an intangible right may be evidenced by a physical object capable of perception by the senses, but nevertheless, considered intangible property for purposes of the law of taxation. Id. As other provisions of N.D.C.C. § 57-39.2-02.1(1) illustrate, the mere fact that a transaction involves the transfer of what is literally tangible personal property, does not necessarily mean a sale of “[t]angible personal property, consisting of goods, wares, or merchandise,” has occurred under N.D.C.C. § 57-39.2-02.1(l)(a).
[¶ 18] Under N.D.C.C. § 57-39.2-02.1(1), sales of tickets to places of amusement or entertainment or athletic events are listed as taxable events distinct from sales of tangible personal property, consisting of goods, wares, or merchandise. See N.D.C.C. § 57-39.1-02.1(l)(c). When an individual purchases a ticket, an item of *207personal property that can be touched or handled is transferred, i.e., the ticket itself. Thus, if we were to construe N.D.C.C. § 57-39.2-02.1(l)(a) to encompass all sales in which personal property that can be touched or handled is transferred, sales of tickets would be subsumed in sales of tangible personal property, thereby rendering N.D.C.C. § 57-39.2-02.1(l)(c) “mere surplusage.” See Bruns v. N.D. Workers Comp. Bureau, 1999 ND 116, ¶ 16, 595 N.W.2d 298. We do not presume the Legislature intended such an idle act. See North Dakota Fair Housing Council, Inc. v. Peterson, 2001 ND 81, ¶ 19, 625 N.W.2d 551 (“Statutes are construed to give effect to each provision.”); Adams County Record v. Greater North Dakota Ass’n, 529 N.W.2d 830, 838 n. 2 (N.D.1995) (stating that it would be absurd to construe a statute in a manner that would render a portion of the statute redundant). Rather, when N.D.C.C. § 57-39.2-02.1(1) is read as a whole to give effect to each provision, it reveals an intention on the part of the Legislature to distinguish sales of “[tjangible personal property, consisting of goods, wares, or merchandise,” see N.D.C.C. § 57-39.2-02.1(l)(a), from sales of intangible rights and services in which the transfer of tangible personal property occurs to symbolize the transfer of such rights. See Comptroller of Treasury v. Washington Nat’l Arena, Ltd., 66 Md.App. 416, 504 A.2d 666, 672 (Spec.App.1986) (finding substantial evidence that tickets are merely physical symbols of an abstract right); Wisconsin Dept. of Revenue v. Milwaukee Brewers Baseball Club, 111 Wis.2d 571, 331 N.W.2d 383, 388 (1983) (reasoning that sales of tickets to baseball games were not sales of tangible personal property because the tickets “were merely indicia establishing that the holder was entitled to admission to the event”). In discussing an earlier version of N.D.C.C. § 57-39.2-02.1, a Special Assistant Attorney General for the Office of the North Dakota State Tax Commissioner explained:
The law broadly imposes a tax on sales of tangible personal property, on the sale or the furnishing of certain services, and on the sale of certain designated intangibles, including but not limited to the leasing or renting of tangible personal property. The specific services subjected to tax are steam, gas, electricity, water and communication services. The intangibles or semi-intangibles subjected to tax are tickets or admissions to places of amusement, entertainment or athletic events, including the amounts charged for participation therein as well as receipts derived from the playing of a machine for amusement or entertainment in response to the use of a coin and the sale of subscriptions to magazines and periodicals.
Joseph R. Maichel, North Dakota Sales and Use Tax Laws and Their General Application, 47 N.D. Law Rev. 383, 384 (1971) (footnote omitted) (emphasis added). Thus, under N.D.C.C. § 57-39.2-02.1(1), all sales of “[tjangible property, consisting of goods, wares, or merchandise,” are subject to sales tax, but sales of intangible property are not subject to sales tax unless specifically designated.
[¶ 19j We note that under N.D.C.C. § 57-39.2-02.1(1), sales of “[mjagazines and other periodicals” are also listed as taxable events distinct from sales of “[tjangible personal property, consisting of goods, wares, or merchandise.” See N.D.C.C. § 57-39.2-02.1(l)(d). The reason for this distinction is best understood by examining the history of North Dakota’s sales tax as applied to sales of magazines. While sales of magazines had always been subject to sales tax apart from any specific provision providing for their taxation, it was debatable if sales tax could be collected from publishers for sell*208ing subscriptions to magazines. See Hearing on S.B. 108 Before the House Comm, on Fin. & Taxation, 37th N.D. Legis. Sess. (Feb. 27, 1961) (testimony of Kenneth Jakes, Tax Department); see also Time, Inc. v. Hulman, 31 Ill.2d 344, 201 N.E.2d 374, 377 (1964) (applying the true object of the transaction test to determine if sales of subscriptions to magazines constituted sales of tangible personal property); Maichel, supra, at 384 (listing sales of subscriptions to magazines as sales of intangible or semi-intangible property). Therefore, in 1961, the Legislature amended former N.D.C.C. § 57-39-02 to impose a tax on “all’ sales of subscriptions to magazines and other periodicals.” See 1961 N.D. Sess. Laws ch. 363, § 2. In 1963, this provision was modified to read “[mjagazines and other periodicals, including subscriptions thereto.” 1963 N.D. Sess. Laws ch. 399, § 2. However, nothing in the legislative history indicates that this modification was in any way intended to affect the manner in which sales of magazines and sales of subscriptions to magazines were taxed under the 1961 amendments. Compare H.B. 559, 38th N.D. Legis. Sess. (1963) with Report of the' House Comm, on Fin. and Taxation on H.B. 559, 38th N.D. Legis. Sess. (1963) (Explanatory Note Amendments to H.B. 559). In 1981, the Legislature deleted the phrase “including subscriptions thereto” from N.D.C.C. § 57-39.2-02.1(l)(d), thereby eliminating the tax on sales of subscriptions to magazines, but maintaining the tax on sales of magazines that had existed both under the 1961 amendments and prior to the 1961 amendments. See 1981 N.D. Sess. Laws ch. 599, § 2; Hearing on S.B. 2223 Before the House Comm, on Fin. and Taxation, 47th N.D. Legis. Sess. (Feb. 25, 1981) (testimony of Sen. Olin). Thus, as the legislative history illustrates, N.D.C.C. § 57-39.2-02.1(l)(d) does not represent an intention on the part of the Legislature to distinguish sales of magazines from sales of tangible personal property, but rather, this subsection is a remnant of the earlier tax on sales of subscriptions to magazines.
[¶ 20] In this case, when American West sells a coupon book, tangible personal property is transferred, i.e., the coupon book itself. However, when American West sells a coupon book, intangible property is also transferred, i.e., the right to receive discounts and free products and services from American West’s clients. The sale of the right to receive discounts and free products is not one of the sales of intangible property that is designated as taxable under N.D.C.C. § 57-39.2-02.1(1). See Maichel, supra, at 384. When a transaction involves both a transfer of tangible personal property and a transfer of intangible personal property that is not designated as taxable, it is often difficult to determine whether the transaction is subject to sales tax under the governing statute. The Minnesota Supreme Court, in determining whether mailing lists used by a direct-mail merchandiser were tangible personal property under Minnesota’s use tax statutes, explained:
In our view, the question presented in the instant case is extremely close, and we do not find the resolution easy. Intangible property, such as information, may be transferred with or without the use of a tangible medium. When a tangible medium is used, it is often the case that such use is merely incidental to the substance of the transaction between the supplier and the consumer of the intangible. Yet our taxing statute makes no distinction regarding the nature of the tangible property subject to taxation; if tangible property is used or consumed, such use or consumption is taxed. Our statute does not, however, impose a tax on the use or consumption *209of intangible personal property. The line of demarcation between the use of intangible property and the use of its tangible manifestation is not a clear one.
Fingerhut Prods. Co. v. Comm’r of Revenue, 258 N.W.2d 606, 610 (Minn.1977).
[¶21] To aid in determining the taxability of a transaction which involves the transfer of both tangible personal property and intangible personal property, a number of jurisdictions focus on the “essence,” or “true object,” of the transaction. See, e.g., Dine Out Tonight Club, Inc. v. Dept. of Revenue Servs., 210 Conn. 567, 556 A.2d 580, 583 (1989); Consol. Freightways Corp. v. Dept. of Revenue and Tax., 112 Idaho 652, 735 P.2d 963, 966 (1987); First Nat’l Bank v. Dept. of Revenue, 85 Ill.2d 84, 51 Ill.Dec. 667, 421 N.E.2d 175, 178-79 (1981); Occidental Chem. Corp. v. Dept. of Revenue and Tax., 751 So.2d 397, 401 (La.Ct.App.2000); Sneary v. Dir. of Revenue, 865 S.W.2d 342, 345 (Mo.1993); Bullock v. Statistical Tabulating Corp., 549 S.W.2d 166, 168 (Tex. 1977). The true object test “focuses on the essentials of the transaction to determine the real object the buyer seeks.” Sneary, 865 S.W.2d at 345. Under this test, a transaction which involves the transfer of both tangible property and intangible property is not subject to sales tax if the consumer’s true object in entering into the transaction is to obtain the intangible property. See id. In such transactions, the tangible property “serves exclusively as the medium of transmission for an intangible product or service” and “is of little utility and may even be discarded after the buyer has used it to obtain access to the intangible component.” Id.
[¶ 22] In light of the statutory framework of N.D.C.C. § 57-39.2-02.1, we find the true object of the transaction test to be useful in determining whether American West’s sales of coupon books constitute sales of “[t]angible personal property, consisting of goods, wares, or merchandise,” under N.D.C.C. § 57-39.2-02.1(l)(a). As discussed earlier, N.D.C.C. § 57-39.2-02.1(1) imposes a tax on all sales of “[tjangible personal property, consisting of goods, wares, or merchandise,” but it only imposes a tax on those sales of intangible property that are specifically designated as taxable. See N.D.C.C. § 57-39.2-02.1(1). When American West sells a coupon book, both tangible personal property, i.e., the coupon book, and intangible property, i.e., the right to receive discounts and free products and services from American West’s clients, are transferred. Consequently, to resolve the issue of whether American West’s sales of coupon books are taxable as sales of “[t]angible personal property, consisting of goods, wares, or merchandise,” we must determine if the true object, or essence, of the sales are the coupon books or the intangible rights to receive discounts and free products and services from American West’s clients. The parties in this case have stipulated to the facts and do not dispute any of the factual findings of the administrative law judge. We, therefore, make this determination as a matter of law on appeal. See First Nat’l Bank, 85 Ill.2d 84, 51 Ill.Dec. 667, 421 N.E.2d 175,176, 178 (applying the essence of the transaction test to affirm the trial court’s conclusion that the taxpayer’s purchases of computer software programs were purchases of intangible property as a matter of law); Occidental Chem. Corp., 751 So.2d at 400-401 (stating that the trial court’s conclusion that a transaction constituted a sale of tangible personal property rather than intangible personal property was “primarily a legal conclusion rather than a factual one”); Ash v. Tray-nor, 1998 ND 112, ¶5, 579 N.W.2d 180 (“Because the parties presented stipulated facts and exhibits, this appeal presents *210only questions of law.”); Northern X-Ray, 542 N.W.2d at 738 (declining to defer to the Commissioner’s interpretation of the word contractor and determining on appeal that a taxpayer did not fall within the statutory definition of a contractor where the facts of the case were not in dispute); Questar Data Sys. v. Comm’r of Revenue, 549 N.W.2d 925, 928 (Minn.1996) (examining the essence of the transaction between a taxpayer and it’s customers as a question of law).5
[¶ 23] In Dine Out Tonight, the Supreme Court of Connecticut applied the true object of the transaction test to resolve an issue similar to the one presented in this case. 556 A.2d at 582-83. In Dine Out Tonight, members of a club paid a membership fee in exchange for a card that entitled them to a free meal with the purchase of a second meal of equal or greater value at restaurants participating in the club’s plan. See id. at 581. A member also received a directory of the participating restaurants. See id. Under Connecticut’s sales tax statutes, tangible personal property was defined as “personal property which may be seen, weighed, measured, felt or touched or which is in any other manner perceptible to the senses.” See id. at 582 n. 4. Thus, the issue was whether Dine Out Tonight was engaged in the selling of tangible membership cards and directories, or the selling of the intangible right to free meals. See id. at 582-83. In resolving this issue, the court reasoned:
A conclusion as to whether the sales tax is applicable to the plaintiffs membership fees requires a determination of the true object of the transaction between the club and its members. We must therefore ascertain whether the true object of that transaction is to provide club members with a card and a directory or to bestow upon them the intangible right to free meals under specified conditions. The determinant is the intention of the parties. We think that intention is evident. Obviously, prospective club members are not enticed to pay the plaintiff for the prospect of obtaining a card and a directory, items that would be of little or no value without the concomitant right to receive free meals. Conversely, the plaintiff could not expect to stay in business by offering for sale only a card and a directory. Manifestly, the sine qua non of the transaction between the club and its members is the intangible right to receive free meals and access to the knowledge of an expanding list of restaurants that provide them. The membership card and directory are merely indicia of that intangible right and incidental aids to its exercise. Because the *211transaction between the plaintiff club and its members is essentially the conveyance of an intangible right to free meals, the plaintiffs membership fees are not subject to the imposition of the Connecticut sales tax.
Id. at 583 (citations omitted).
[¶ 24] Similar to the membership cards in Dine Out Tonight, the coupon books that American West sells would be of little or no value without the concomitant right to receive discounts and free products and services from American West’s clients. See Dine Out Tonight, 556 A.2d at 583; Sneary, 865 S.W.2d at 345. American West could not expect to stay in business by attempting to sell books of coupons for $43.95 if no rights to receive discounts were attached to those coupons. Likewise, consumers would not be willing to pay American West $43.95 for coupon books if they could not use the coupons in those books to receive discounts from American West’s clients. It, therefore, seems evident that when a consumer pays American West $43.95 for a coupon book, the true object of the transaction is not the purchase of the tangible coupon books, but the purchase of the intangible right to receive discounts and free products and services from American West’s clients. See Dine Out Tonight, at 583; see also Navistar Int’l Trans. Corp., 35 Cal.Rptr.2d 651, 884 P.2d at 110 (“[F]or purposes of the law of taxation, intangible property is defined as including personal property that is not itself intrinsically valuable, but that derives its value from what it represents or evidences.”). We conclude the coupon books themselves merely serve as tangible mediums for the transmission of an intangible right. See Dine Out Tonight, 556 A.2d at 583; Sneary, 865 S.W.2d at 345.
[¶ 25] Although the Commissioner, through the promulgation of N.D. Admin. Code § 81-04.1-01-28, has concluded that sales of coupon books are taxable as sales of tangible personal property, the distinction the Legislature has made between sales of “[t]angible personal property, consisting of goods, wares, or merchandise,” and sales of intangible rights outweighs the Commissioner’s conclusion. The Commissioner has only interpreted the phrase “tangible personal property” to include sales of coupon books since 1989, see N.D. Admin. Code § 81-04.1-01-28, while the Legislature has distinguished sales of “[t]angible personal property, consisting of goods, wares, or merchandise,” from sales of intangible rights since 1935, see 1935 N.D. Sess. Laws ch. 276, § 2 (listing sales of “tangible personal property, consisting of goods, wares, or merchandise,” as taxable events distinct from “sales of tickets or admissions to places of amusement and athletic events”). “[T]he rules that an administrative interpretation of an act is entitled to controlling weight may not be invoked where the interpretation was neither continuous nor contemporaneous with the enactment of the statute.” See Singer, supra § 49:08, 103. Furthermore, while an agency’s interpretation of long-duration is entitled to deference, “we will not defer to even a longstanding agency interpretation that is contrary to the intent of the legislature.” Northern X-Ray, 542 N.W.2d at 738; accord Medcenter One, Inc. v. N.D. State Bd. of Pharm., 1997 ND 54, ¶ 17, 561 N.W.2d 634; see also Singer, supra § 49:07, 99 (stating that an agency’s long-standing interpretation can be overridden by more compelling considerations).
[¶ 26] The statutory scheme of N.D.C.C. § 57-39.2-02.1, when read as a whole, manifests a legislative intent to not tax the sale of intangible personal property unless specifically identified and listed as subject to sales tax. Construing the statute in the broad manner suggested by the *212Commissioner would run contrary to this intent by taxing all sales of intangible personal property evidenced by tangible personal property, no matter how negligible the intrinsic value thereof. See Moore, 374 N.W.2d at 74 (An administrative officer “cannot initiate policy in the true sense, but must fundamentally pursue a policy predetermined by the same power from which he derives his authority.”). Because the Legislature has not designated the sale of coupon books as a sale of intangible personal property that is subject to sales tax under N.D.C.C. § 57-39.2-02.1(1), we must resolve any doubt about their taxation in favor of American West. See Rocky Mountain Oil, 405 N.W.2d at 281 (“[I]f a tax statute is ambiguous so that the legislative intention with respect to the meaning of the statute is doubtful, the doubt must be resolved in favor of the taxpayer.”). In reaching this conclusion, we are not aware of any jurisdiction that has interpreted the sale of tangible personal property to include the sale of coupon books. We do not intimate that our Legislature could not, if it so chose, tax the sale of coupon books. However, as N.D.C.C. § 57-39.2-02.1 currently exists, sales of coupon books are not taxable as sales of “[tjangible personal property, consisting of goods, wares, or merchandise.”
[¶ 27] In concluding that the Commissioner did not exceed statutory authority in taxing sales of coupon books as sales of tangible personal property, the ALJ analogized sales of coupon books to sales of novels and textbooks. We do not agree with this reasoning. The sale of a novel or a textbook, is not merely the sale of raw intangible information. Cfi Sioux Falls Newspapers v. Sec’y of Revenue, 423 N.W.2d 806, 810 (S.D.1988) (concluding that syndicated newspaper columns were not raw intangible information, but were “finished produet[s] of an artist’s or a writer’s skills”). Thus, when a consumer purchases a book such as a novel or a textbook, the tangible product of an individual’s skills, a sale of “[t]angible personal property, consisting of goods, wares, or merchandise,” has taken place. See Nav-istar Int’l Trans. Corp., 35 Cal.Rptr.2d 651, 884 P.2d at 113 (“[T]he sale of books and pamphlets, although ‘purchased for the author’s ideas rather than for their physical components,’ is generally taxable.”).
[¶ 28] In contrast to novels and textbooks, coupon books are books of “certificate[s] or ticket[s] entitling the holder to a specified right, as redemption for cash or gifts, reduced purchase price, etc.” Webster’s New World Dictionary 325 (2d coll. ed.1980) (defining coupon). An individual’s purpose in buying a coupon book is not to obtain the book itself, but to obtain the right to receive discounts that are represented by the coupons. See Dine Out Tonight, 556 A.2d at 583. The coupon books are used exclusively as mediums to transfer this intangible right and, once this right is exercised or expires, the coupon books are essentially worthless. See Dine Out Tonight, 556 A.2d at 583; Sneary, 865 S.W.2d at 345. Unlike novels and textbooks, items such as coupon books and tickets are of little or no value without the concomitant rights to receive discounts and attend events. See Dine Out Tonight, 556 A.2d at 583; Washington Nat’l Arena, 504 A.2d at 672.
IV
[¶ 29] We conclude that sales of coupon books are not sales of “[tjangible personal property, consisting of goods, wares, or merchandise,” under N.D.C.C. § 57-39.2-02.1(1). Thus, the portion of N.D. Admin. Code § 81-04.1-01-28 which provides: “Sales of coupons, coupon books, and other certificates which entitle the holder to a *213discount or other price advantage on the purchase of goods or services, whether or not the goods or services are subject to sales or use tax, are taxable as sales of tangible personal property,” is beyond the scope of the Commissioner’s statutory authority and is, therefore, void. See Moore, 374 N.W.2d at 74, 75. Consequently, American West is not liable for the $20,883.51 in sales tax assessed by the Commissioner. Cf Northern X-Ray, 542 N.W.2d at 738 (holding that a taxpayer was neither hable for taxes under the administrative regulation nor the regulation’s governing statute). We reverse the decision of the district court and remand to the Tax Commissioner for further proceedings consistent with this opinion.
[¶ 30] NEUMANN and KAPSNER, JJ. concur.

. We note N.D.C.C. § 28-32-46 adds additional grounds for not affirming an adminis*200trative agency decision, effective August 1, 2001. American West filed its appeal from the Commissioner’s decision on March 1, 2001. Therefore, former N.D.C.C. § 29-32-19 applies.

. The dissent asserts our reliance on Northern X-Ray "oversimplifies" the analysis in this case because it contends Northern X-Ray did not involve either legislative acquiescence to an administrative rule or deference to a longstanding administrative agency interpretation of a statute. Contrary to the dissent's assertion, Northern X-Ray contained the following discussion concerning the deference to be given to an agency's interpretation of a statute as evidenced in an administrative rule:
Our conclusion is at odds with that of the Commissioner, who argues, in effect, that anyone who enters a contract to install tangible personal property into real estate is a contractor under section 57-40.2-03.3. The Commissioner asks us to defer to the agency's interpretation of "contractor," and points to section 81-04.1-04.20, NDAC, which says "[a] contractor or subcontractor installing materials into real property located in North Dakota must pay sales or use tax on those materials regardless of who owns them." This regulation, however, presents the same problems as the statute: ambiguous use of the term "contractor.” We give some weight to the "practical construction of a statute by the agency administering it” and we also give weight "to the long-continued, practical construction placed on statutes by the officers charged with the duty of applying them.” The record before us shows no unambiguous nor "long-continued” interpretation. Moreover, we will not defer to even a long-standing agency interpretation that, is contrary to the intent of the legislature. Therefore, we will not defer unreservedly to the agency interpretation of “contractor."
See Northern X-Ray, at 738 (citations omitted) (emphasis added). It was after the Court determined that it would not defer "unreservedly” to N.D. Admin. Code § 81-04.1-04.20 that it then addressed the issue of whether Northern X-Ray was a "contractor” within the meaning of the statute. See id. ("The question remaining is whether Northern is a contractor under the definition provided in section 43-07-01(3).").

. There are documents that show the Commissioner provided the interim Administrative Rules Committee a memorandum which contained the text of forty different administrative rules at a July 11, 1989, meeting of that committee. See Minutes of Administrative Rules Comm, appendix K (July 11, 1989); Memorandum of State Tax Commissioner dated July 11, 1989. The 1989 version of N.D. Admin. Code § 81-04.1-01-28 was one of the forty rules in this memorandum, and the Administrative Rules Committee did not object to the adoption of it or any of the other thirty-nine rules listed in the memorandum. See Minutes of Administrative Rules Comm. 8 (July 11, 1989); Memorandum of State Tax Commissioner dated July 11, 1989. However, the fact that the eleven members of the Administrative Rules Committee present at the July 11, 1989, meeting did not object to the 1989 amendments to N.D. Admin. Code § 81-04.1-01-28 is not evidence that the Legislative Assembly as a whole approved of the amendments. See Eklund v. Eklund, 538 N.W.2d 182, 187-188 (N.D.1995) (noting that the Administrative Rules Committee supported the "income shares” model for setting child support while the Legislative Assembly rejected the use of the “income shares” model). Furthermore, this fact is certainly not evidence of what the Legislative Assembly intended when it first applied the sales tax to *203sales of "[tjangible personal property, consisting of goods, wares, or merchandise,” in 1935. See 1935 N.D. Sess. Laws ch. 276, § 2 (applying the sales tax to sales of "tangible personal property, consisting of goods, wares, or merchandise,”).

. Numerous courts require evidence of express legislative approval of an agency interpretation before they will attribute significant weight to the reeanctment doctrine. See United. States v. Bd. of Commissioners, 435 U.S. 110, 135, 98 S.Ct. 965, 55 L.Ed.2d 148 (1978) (stating that "it is impermissible to draw inferences of approval from the unexplained inaction of Congress," but Congress is presumed to have ratified an agency’s interpretation where "the legislative history of the re-enactment showed that Congress agreed with that interpretation”); ABC Rentals v. Commissioner, 142 F.3d 1200, 1205 (10th Cir.1998) ("[R]eenactment without change in relevant statutory language and mere Congressional inaction are at best unreliable indications of Congressional intent to adopt an administrative construction of a statute. The inference of Congressional approval is stronger when legislative history contains some indication that Congress was aware of and approved the administrative construction.” (citation omitted)); Isaacs v. Bowen, 865 F.2d 468, 473 (2d Cir.1989) ("Mere reenactment is insufficient. It must also appear that Congress expressed approval of the agency interpretation.”); AFL-CIO v. Brock, 835 F.2d 912, 915 (D.C.Cir.1987) ("This court has also consistently required express congressional approval of an administrative interpretation if it is to be viewed as statutorily mandated.”); J.R. Simplot Co. v. State Tax Commission, 120 Idaho 849, 820 P.2d 1206, 1221 (1991) ("[W]e require 'something more' to determine actual legislative intent than merely reenacting the statute after it has received an agency construction.” (emphasis in original)); GE Solid State, Inc. v. Director, Division of Tax., 132 N.J. 298, 625 A.2d 468, 475 (1993) ("Where the regulation is inconsistent with the ordinary and primary meaning of the statutory language, it should be disregarded, despite the subsequent reenactment of the statute, at least in the absence of a clear showing that the Legislature specifically considered the regulation and approved it in re-enacting the provision.” (emphasis in original)).

. Our research has revealed only two published cases in which it was stated that the determination of the true object of a transaction is a factual determination. See Financial Computer Serv. v. Lindley, 70 Ohio St.2d 243, 436 N.E.2d 1025, 1027 (1982) (per curiam); Servi-Clean Indust. v. Collins, 50 Ohio St.2d 80, 362 N.E.2d 648, 652 (Ohio 1977) (per curiam). Subsequent to these two cases, the Supreme Court of Ohio significantly modified the manner in which it applied the true object test. See Emery Indust. v. Limbach, 43 Ohio St.3d 134, 539 N.E.2d 608, 610-614 (1989) (per curiam). Since this modification, we are unaware of any Ohio case in which it was stated that the determination of the true object of a transaction is a factual determination rather than a legal one. See generally WBNS TV, Inc. v. Tracy, 75 Ohio St.3d 572, 664 N.E.2d 938, 939 — 41 (1996) (per curiam); Amerestate, Inc. v. Tracy, 72 Ohio St.3d 222, 648 N.E.2d 1336, 1337 (1995) (per curiam); Community Mut. Ins. Co. v. Tracy, 73 Ohio St.3d 371, 653 N.E.2d 220, 223-24 (1995) (per curiam); Columbia Gas of Ohio, Inc. v. Limbach, 69 Ohio St.3d 462, 633 N.E.2d 1108, 1110 (1994) (per curiam); General Motors Corp. v. Limbach, 44 Ohio St.3d 115, 541 N.E.2d 593, 595 (1989) (per curiam).