NOTICE: IC § 4-22-7-7 permits the publication of this document in the Indiana Register. The publication of this document provides the general public with information about the Indiana Department of Revenue's official position concerning a specific set of facts and issues. The "Holding" section is provided for the convenience of the reader and is not part of the analysis contained in this document.

Company provided documentation supporting its refund claim. Thus Company is entitled to its refund.

I. Gross Retail Tax - Vehicle Sales.

Authority: IC § 6-2.5-2-1; IC § 6-8.1-9-1; Dept. of State Revenue v. Caterpillar, Inc., 15 N.E.3d 579 (Ind. 2014).

Taxpayer protests the Department's refund denial.

Taxpayer is a vehicle titling company based in Florida and does business in other states including Indiana. Taxpayer works with dealerships and customers to title and plate vehicles for customers. Taxpayer pays the sales tax and registration for its customers and receives payment for that service. Taxpayer requested a refund for sales tax paid on behalf of customer ("Customer"). The Indiana Department of Revenue ("Department") denied the refund request in full because only the customer, or those who created the taxable event, are allowed to receive a refund for sales tax paid on a vehicle.

Taxpayer disagreed with the refund denial and submitted a protest to that effect. An administrative hearing was conducted during which Taxpayer explained the basis for its protest. This Memorandum of Decision results.

I. Gross Retail Tax - Vehicle Sales.

The Department notes that, "[W]hen [courts] examine a statute that an agency is 'charged with enforcing. . .[courts] defer to the agency's reasonable interpretation of [the] statute even over an equally reasonable interpretation by another party.'" Dept. of State Revenue v. Caterpillar, Inc., 15 N.E.3d 579, 583 (Ind. 2014). Thus, all interpretations of Indiana tax law contained within this decision, as well as the preceding audit, shall be entitled to deference.

IC § 6-8.1-9-1(a) states:

Sales tax is imposed by IC § 6-2.5-2-1, which states:

Taxpayer requested a refund based on the incorrect trade-in value of the car; Taxpayer argued that the trade-in value was incorrectly reported on the Indiana Bureau of Motor Vehicles ("BMV") registration causing an increase in Indiana sales tax due. Taxpayer explains that it provided the service of registering Customer's vehicle in Indiana, including payment of tax at the time of registration. Taxpayer believes that, since it paid the tax at the time of registration and since it determined that Customer's trade-in value was not properly credited against the purchase price of Customer's new vehicle, it should receive a refund of tax based on the reduced purchase price. In support of its position, Taxpayer provided documentation showing the purchase price of Customer's new vehicle and the trade-in value of Customer's prior vehicle. Taxpayer also provided proof that Customer was properly refunded of the portion of sales tax it is requested.

After review of the materials provided, the Department agrees with Taxpayer's protest. Taxpayer provided sufficient documentation that the trade in value of the vehicle was incorrectly stated on the BMV registration. Also Taxpayer provided proof of sales tax was refunded to Customer. Thus, Taxpayer is entitled to the full amount of refund requested.

Taxpayer's protest is sustained.

October 31, 2019