Court Opinion

ID: 3260245
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:31:54.508992+00
Date Added: 2024-06-11T13:05:34.572773
License: Public Domain

The Honorable Mark J. Riable State Representative 9710 I-30 Little Rock, Arkansas 72209
Dear Representative Riable:
This is in response to your request for an opinion on whether the newly adopted sales tax on the service of storing motor vehicles will be applicable to an automobile repossession business which periodically stores automobiles for its clients, as opposed to businesses which are "strictly . . . vehicle storage yard[s]."
It is my opinion that if the business to which you refer provides the service of storing motor vehicles and makes a charge for this service, the sales tax will apply to the transaction.
Act 5 of the Second Extraordinary Session of 1992 imposes the Arkansas Gross Receipts Tax on a number of services. The relevant portion of the act for our purposes is Section 1, which amends A.C.A. § 26-52-301 by adding a new subdivision which, among other things, levies the gross receipts tax on the ". . . service of storing a motor vehicle."
If, therefore, the "service of storing a motor vehicle" is performed by the business to which you refer, and a charge is made for this service, the sales tax is applicable. The tax applies to the providing of the service, and does not condition its applicability to businesses which are exclusively or even primarily involved in providing the service in question.
The determination as to whether the sales tax is applicable to a particular business, however, will be a question for the Department of Finance and Administration, which can evaluate all of the facts surrounding the services provided. The Department may issue letter opinions to this effect. See Gross Receipts Tax Regulation GR-75.
The foregoing opinion, which I hereby approve, was prepared by Deputy Attorney General Elana C. Wills.
Sincerely,
WINSTON BRYANT Attorney General
WB:cyh