Court Opinion

ID: 3540444
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:51:56.317098+00
Date Added: 2024-06-11T13:45:36.278310
License: Public Domain

[EDITORS' NOTE:  THIS OPINION HAS BEEN WITHDRAWN.]
FILED 71
Honorable John Wm. Buechner State Representative, 94th District Room 108, State Capitol Building Jefferson City, Missouri 65101
Dear Representative Buechner:
This is in response to your request for an official opinion from this office answering the following question:
         "Can a corporation with separately managed divisions operating distinct and separate motor vehicle activities elect to have one division pay Missouri sales tax at the time of purchase of its motor vehicles and elect to have another division pay sales tax as rental proceeds are received from its customers?"
The option to pay sales tax on motor vehicles held exclusively for rental or lease purposes either at the time of registration of the vehicle or at the time rental proceeds are received is provided for in Section 144.070.5, RSMo Supp. 1975, which reads as follows:
              "Any person, company, or corporation
engaged in the business of renting or leasing motor vehicles or trailers, which are to be used exclusively for rental or lease purposes, and not for resale may apply to the director of revenue for authority to operate as a leasing company. Any company approved by the director of revenue may pay the tax due on any motor vehicle or trailer as required in section 144.020 at the time of registration thereof or in lieu thereof may pay a sales tax as provided in sections 144.010,  144.020, 144.070 and 144.440. A sales tax shall be charged to and paid by a leasing company which does not exercise the option of paying in accordance with section 144.020, on the amount charged for each rental or lease agreement while the motor vehicle or trailer is domiciled in this state. Any motor vehicle, which is leased as the result of a contract executed in this state shall be presumed to be domiciled in this state." (Emphasis added)
Note that this option is granted only to persons, companies
or corporations who apply for and are granted the authority to operate as a "leasing company". The authority to operate as a leasing company is granted to the business as a whole and there is no statutory provision allowing the Director of Revenue the discretion to grant this authority to individual units or divisions within a corporation or business. Section 144.070.6, RSMo Supp. 1975 makes it clear that if a business elects to operate as a "leasing company" and pay sales tax at the time rental proceeds are received instead of at the time of registration, all
the motor vehicles held for rental and leasing purposes by that business must be included in this option. The statute provides as follows:
              "If the owner of any motor vehicle or trailer desires to charge and collect sales tax as provided hereinabove, he shall make application to the director of revenue for a permit to operate as a motor vehicle or trailer leasing company. The director of revenue shall promulgate rules and regulations determining the qualifications of such a company, and the method of collection and reporting of sales tax charged and collected. Said regulations shall apply only to owners of motor vehicles or trailers, electing to qualify as motor vehicle or trailer leasing companies under the provisions of subsection 5 of section 144.070, and no motor vehicle renting or leasing or trailer renting or leasing company can come under sections 144.010, 144.020, 144.070 and 144.440 unless all vehicles held for renting and leasing are included." (Emphasis added)
CONCLUSION
Therefore, it is the opinion of this office that a corporation involved in the rental and leasing of motor vehicles may elect either to pay sales tax at the time it receives the gross receipts from the rental or lease agreements or at the time of registration of the motor vehicles. However, either election must include all motor vehicles held for rental or lease and a corporation with separately managed divisions may not elect to have one division pay Missouri sales tax at the time the vehicles are purchased and another division pay sales tax as rental proceeds are received from its customers.
The foregoing opinion, which I hereby approve, was prepared by my assistant, Joel Wilson.
Very truly yours,
                                  JOHN ASHCROFT Attorney General