Court Opinion

ID: 8181043
Source: CourtListenerOpinion
Date Created: 2022-09-09 22:41:20.433254+00
Date Added: 2024-06-11T16:40:11.430584
License: Public Domain

MILLER, Justice,
dissenting:
I respectfully dissent from the Court’s opinion for several reasons. First, I believe the majority opinion inaccurately characterizes the Tax Commissioner’s position. The Tax Commissioner did not argue that sales of property or services must be made to persons “directly” engaged in manufacturing. Rather, he contended throughout these proceedings that in order for General Motors Corporation (GM) to qualify for the sales tax exemption, the warranty parts and services it purchased from its dealers had to be “directly used or consumed” by it in its business of manufacturing. The purchases at issue occurred months after the cars rolled off the assembly line and had been purchased by dealers and resold to customers. The warranty parts were then purchased by the dealers and installed on the cars.
The Tax Commissioner cogently argued, I thought, that GM’s manufacturing business had already ended by the time its dealers provided the warranty parts and services and, therefore, such parts and services were not directly used or consumed in GM’s manufacturing business. The Court did not address, let alone refute, this argument. Nor does the Court even attempt to distinguish the decisions of other courts, particularly Ohio, which support the position that GM is not entitled to the exemption because the warranty parts and services were not “directly used or consumed” in its manufacturing business, as required by W.Va.Code, 11-15-9(6).
In Southwestern Portland Cement Co. v. Limbach, 35 Ohio St.3d 196, 197, 519 N.E.2d 831, 833 (1988), the Supreme Court of Ohio reiterated the following test from the Syllabus of Youngstown Bldg. Material & Fuel Co. v. Bowers, 167 Ohio St. 363, 5 O.O.2d 3, 149 N.E.2d 1 (1958), to determine what purchases the legislature intended to exempt from the sales tax as being directly used in the business of manufacturing:
“In determining whether tangible personal property is used or consumed directly in the production of tangible personal property for sale by manufacturing or processing, and, therefore, whether its sale or use is excepted from taxation under ... [the statute] ..., the test is not whether such property is essential to the operation of an ‘integrated plant;’ the test to be applied being, when does the actual manufacturing or processing activity begin and end, and is the property used or consumed during and in the manufacturing or processing period. (Emphasis added).”
See generally Annot., 4 A.L.R.4th 581 (1981); Annot., 30 A.L.R.2d 1439 (1953).
Furthermore, the majority fails to give any recognition to the applicable canons of statutory construction. The entire claim of GM centers on an exemption clause contained in the then-existing tax statute, W.Va.Code, 11-15-9(6) (1974).1 It is an *464accepted tax law principle in this jurisdiction that an “exemption is strictly construed against the person claiming the exemption.” Wooddell v. Dailey, 160 W.Va. 65, 68, 230 S.E.2d 466, 469 (1976). Furthermore, the Tax Commissioner’s interpretation of the exemption statute should have been accorded considerable weight, under the established administrative law principle stated in Syllabus Point 1 of Dillon v. Board of Educ. of County of Mingo, 171 W.Va. 631, 301 S.E.2d 588 (1983): “ 'Interpretations of statutes by bodies charged with their administration are given great weight unless clearly erroneous.’ Syllabus Point 4, Security National Bank & Trust Co. v. First W.Va. Bancorp., Inc., [166] W.Va. [775], 277 S.E.2d 613 (1981), appeal dismissed, 454 U.S. 1131, 102 S.Ct. 986, 71 L.Ed.2d 284 [ (1982) ].” See also Smith v. State Workmen’s Compensation Comm’r, 159 W.Va. 108, 219 S.E.2d 361 (1975); Evans v. Hutchinson, 158 W.Va. 359, 214 S.E.2d 453 (1975).
I submit that if the undefined words of the exemption statute are given their common, ordinary, and accepted meaning, as required by the rules of statutory construction, e.g., Syllabus Point 6, State ex rel. Cohen v. Manchin, 175 W.Va. 525, 336 S.E.2d 171 (1984), the Tax Commissioner’s position must be upheld. The phrase “directly used or consumed” in the manufacturing business cannot reasonably be defined to include the installment of warranty parts by GM’s dealers. Nor can warranty parts and service come within any established judicial definition of “manufacturing,” which generally denotes the making of something new. See Ballard’s Farm Sausage, Inc. v. Dailey, 162 W.Va. 10, 19, 246 S.E.2d 265, 270 (1978) (Miller, J., concurring).2 In my judgment, the Tax Commissioner’s interpretation and application of the exemption statute was not clearly erroneous.
The majority’s economic policy arguments are not at all persuasive to me. Formulation of tax policy is conspicuously a legislative function. Facile economic arguments certainly do not justify a judicial rewriting and liberalization of the exemption provision.
I, therefore; dissent.

. The pertinent language of W.Va.Code, 11 — 15— 9(6) (1974), is:
‘‘[S]ales of property or services to persons engaged in this state in the business of con*464tracting, manufacturing, transportation, transmission, communication, or in the production of natural resources: Provided, however, That the exemption herein granted shall apply only to services, machinery, supplies and materials directly used or consumed in the business of organizations named above[.]" (Emphasis added).

. W.Va.Code, 11-15-2(p) (1987), presently defines "manufacturing” as follows: "‘Manufacturing’ shall mean a systematic operation or integrated series of systematic operations engaged in as a business or segment of a business which transforms or converts tangible personal property by physical, chemical or other means into a different form, composition or character from that in which it originally existed.”