Maryland Recreational Vehicle Dealers Ass'n, Inc. v. Comptroller of the Treasury
| Decision Date | 01 September 1988 |
| Docket Number | No. 1027,1027 |
| Citation | 558 A.2d 437,79 Md.App. 497 |
| Parties | MARYLAND RECREATIONAL VEHICLE DEALERS ASSOCIATION, INC. v. COMPTROLLER OF THE TREASURY. , |
| Court | Court of Special Appeals of Maryland |
John B. Jones-Bateman (Carson & Jones-Bateman, on the brief), Baltimore, for appellant.
Linda Koerber Boyd, Asst. Atty. Gen. , Baltimore, for appellee.
Argued before MOYLAN, BISHOP and ROSALYN B. BELL, JJ.
Appellant, Maryland Recreational Vehicle Dealers Association, Inc. (Dealers Association) has taken this appeal from a judgment of the Circuit Court for Baltimore County affirming a decision of the Maryland Tax Court. The tax court had affirmed a Hearing Officer's denial of the Dealers Association refund claims. The sole issue before us is whether the tax court's holding, that the gross receipts from the sales of tickets to the annual Recreational Vehicle Dealers Show are subject to the Admissions and Amusement Tax set out in Md.Ann.Code Art. 81, § 402(a)(1)(i), is erroneous as a matter of law.
The facts are undisputed. The Dealers Association is a Maryland corporation whose membership consists primarily of metropolitan Baltimore area holders of recreational vehicle dealer licenses issued by the State of Maryland. Its primary purposes are to foster the use and promote the sale of recreational vehicles, to educate the public with respect to such vehicles, and to insure that members deal fairly and equitably with the purchasing public. Appellant also serves as the industry's voice with governmental authorities.
Pursuant to these purposes, the Dealers Association holds an annual Recreational Vehicle Dealers Show. During the years relevant to this matter, the show has been held at the State Fair Grounds in Timonium, Maryland. These shows are open to the public and admission is on a ticket basis. Admission tickets are sold at the entrances to the State Fair Grounds buildings and are separated at the gate by ticket takers who return a stub portion to the patron presenting the ticket.
The show itself consists of approximately 80 individual dealers' displays of products they sell. Various types and models of recreational vehicles are exhibited, as are various accoutrements and ancillary recreational products and items. The public is invited to walk around, view, and inquire about the merchandise on display. Some vendors use a video cassette recorder and a television screen to show a continuous tape which provides information about products being sold and their operation. Patrons are encouraged to enter into contracts to purchase products represented by sample or display items.
At the show, the Dealers Association sponsors a prize, and some individual vendors sponsor drawings with prizes offered. Some vendors hand out free advertising material. At the 1986 show, the Dealers Association provided patrons with a two-page directory of exhibitors and a floor map. The show is advertised on radio and television. No music is provided, either live or canned; no circulating or fixed side shows such as jugglers or clowns are present; and no contests of skill are allowed.
Since 1949, the administrative practice of the Comptroller of the Treasury (Comptroller) has been to tax craft shows antique shows, boat shows, car shows and shows such as the annual Maryland Recreational Vehicle Dealers Show. During the period from February, 1983 through February, 1986, the Dealers Association paid $25,823.88 in admission and amusement taxes for the Recreational Vehicle Show. On March 10, 1986 and again on March 24, 1986 the Dealers Association filed claims for refunds of these taxes. The Retail Sales Tax Division of the Comptroller's Office denied the Dealers Association refund claims.
The Dealers Association appealed and a hearing was held before a Hearing Officer for the Retail Sales Tax Division. The Hearing Officer affirmed the denial of the refund claims. The Dealers Association then appealed to the Maryland Tax Court. The tax court affirmed the Hearing Officer's decision. The Dealers Association carried their appeal to the Circuit Court for Baltimore County. By Order of Judge William M. Nickerson, the tax court decision was affirmed. This appeal followed.
In Comptroller v. Burn Brae Dinner Theatre, 72 Md.App. 314, 318, 528 A.2d 546 (1987), the scope of our review was set forth:
Appellant contends that the tax court's decision in interpreting Art. 81, § 402(a)(1)(i) was erroneous as a matter of law. Section 402(a)(1)(i) applies as follows:
Appellant maintains that subsection (i) requires that a performance be provided in order for any admission to be taxable.
We disagree with the Dealers Association and adopt the reasoning of the Maryland Tax Court when it concluded that a performance is not required for the imposition of the admissions tax.
The tax court stated the following:
Scoville Services, Inc. v. Comptroller, 269 Md. 390 (1972).
The statute at issue was amended in 1971 and 1972. Prior to those years, § 402 read:
"(1) admission to any place, whether such admission be by single ticket, season ticket or subscription, (2) admission within an enclosure in addition to the initial charge for admission to such enclosure, (3) the use of sporting or recreation facilities or equipment, and (4) admission, cover charge for seats or tables, refreshment, service or merchandise at any roof garden, cabaret or other similar place where there is furnished a public performance when payment of such amounts entitles the patron thereof to be present during any portion of such performance." (Emphasis added.)
The 1971 amendment made a corrective placement of the phrase "cover charge for seats or tables ... at any roof garden, etc.," emphasized above, from § 402(a)(4) to § 402(a)(1). In addition, the word "admission" was deleted from § 402(a)(4).
The pre-1971 statute drew a distinction among four situations and taxed each similarly.
"1. The typical admission charge imposed by theaters, ball parks, skating rinks and the like;
2. A second admission charge, such as that imposed for a reserved seat once a general admission charge has been paid;
3. Charges made for the use of sporting or recreational facilities or equipment; and
4. Charges for refreshment, service or merchandise at any place where there is music, dancing or other entertainment, whether or not there is an admission or cover charge, as well as for admission, if such a charge is imposed.
Villa Nova Night Club, Inc. v. Comptroller, 256 Md. 381, 389 (1970). The first was a tax on admissions while the fourth taxed refreshments served when a performance was given, as well as for admission to such a place. By amending the statute as noted above, the legislature eliminated surplus language and clarified the statute so that all admissions were referred to in one section only. The 'cover charge' language was properly placed in section one of the statute because a cover charge to a roof garden, cabaret, etc. where a performance is furnished is an admission charge.
Also, note that the pre-1971 statute, in § 402(a)(1), taxed 'admission to any place' with no performance requirement. The review of the laws amending § 402 shows no effect of the transfer of the 'cover charge' phrase on the tax on admission category.
The Petitioner contends that there exists a performance requirement in § 402(a)(1)(i) due to the placement of the comma...
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