Peterson v. Oklahoma Tax Commission
| Citation | 1964 OK 78,395 P.2d 388 |
| Decision Date | 31 March 1964 |
| Docket Number | No. 40420,40420 |
| Parties | D. L. PETERSON, Trustee, Plaintiff in Error, v. OKLAHOMA TAX COMMISSION, Defendant in Error. |
| Court | Supreme Court of Oklahoma |
Syllabus by the Court
1. The long-continued construction of statutory provisions by a department of government charged with their execution is entitled to great weight and should not be overturned without cogent reasons; and where the Legislature has convened many times during this period of administrative construction without expressing its disapproval, such silence may be regarded as acquiescence in or approval of the administrative construction.
2. The taxes levied and collected under the provisions of the Motor Vehicle Excise Tax Act are not in lieu of the sales tax levied and collected under the provisions of the Sales Tax Act, upon the gross receipts or gross proceeds derived from the leasing or renting of motor vehicles where such leasing or renting results in only a transfer of possession.
3. The Legislature has a wide range of discretion in classifying subjects of taxation, and to justify judicial interference, the classification adopted by the Legislature must be based on an unreasonable and arbitrary classification.
Plaintiff in error appeals from an order of the Oklahoma Tax Commission denying a claim for a refund of sales taxes paid under protest. Order affirmed.
John K. Speck, Speck, Fleig & Hewett, Oklahoma City, for plaintiff in error.
Albert D. Lynn, E. J. Armstrong, Oklahoma City, for Oklahoma Tax Commission, defendant in error.
D. L. Peterson, Trustee, filed an application with the Oklahoma Tax Commission, hereinafter referred to as Commission, for a refund of sales taxes paid by the Trustee under protest, upon the gross receipts received by him from renting or leasing motor vehicles for use in Oklahoma, from February 1, 1957 through September 30, 1961. The Trustee alleged that he was relieved from paying the sales tax and entitled to the refund for the reason there were no sales taxes due or owing because there had been paid the motor vehicle excise tax and such tax is in lieu of the sales tax.
The Commission denied the Trustee's claim for the refund and the Trustee lodged this appeal.
It was stipulated that the Trustee enters into lease agreements under which fleets of vehicles are leased to others for periods of not less than one year; that Trustee, as lessor, leases motor vehicles and the lessees agree to pay the Trustee a fixed monthly rental predicated upon a predetermined percentage per month of the original cost, plus a predetermined rate of interest thereon; that the lessees pay all the costs, expenses, taxes, fees and charges incurred in connection with the titling, licensing and registration of such vehicles and their use and operation during the term of the lease; that all of said lease agreements were made and entered into outside the State of Oklahoma; that title and possession of all motor vehicles were originally taken by the Trustee and delivery of possession was subsequently made to the lessees; and that Trustee paid a sales tax on the gross receipts received from the rental and leasing of the motor vehicles and has paid the motor vehicle excise tax on substantially all the motor vehicles leased under the lease agreements.
In addition to the above, the Rules and Regulations promulgated and adopted by the Commission and the manner in which the Commission has administered the Motor Vehicle Excise Tax Acts and the Sales Tax Act were in the stipulation. The rules and regulations will be referred to later in considering the contentions of the parties.
The Trustee contends that the motor vehicle excise tax is in lieu of the sales tax and the Motor Vehicle Excise Tax Act prohibits the levy of a sales tax upon the gross receipts derived from rentals of motor vehicles upon which vehicles the motor vehicles excise tax has been paid; and, the Oklahoma Sales Act specifically exempts from the sales tax the gross receipts derived from the rental of motor vehicles by virtue of Title 68 O.S.1951 § 1251d(m).
The Commission contends the payment of the motor vehicle excise tax paid on substantially all of the vehicles registered by the Trustee in Oklahoma does not relieve the Trustee from paying a sales tax on the gross receipts derived from renting or leasing of vehicles for use in Oklahoma where such rental or leasing results only in a transfer of possession of the motor vehicles.
In considering the above contentions we find the basic issue to be resolved is whether the payment of the Motor Vehicle Excise Tax (Title 47 O.S.1951 §§ 52-52i) relieves the payment of a sales tax upon the gross receipts derived from the renting or leasing of motor vehicles for use in Oklahoma as provided by Title 68 O.S.1951 §§ 1251-1261.7, where there has been only a transfer of possession of the motor vehicles.
The statutory provisions relied upon by the Trustee to sustain his contention that he is entitled to a refund of sales taxes paid by him upon the gross receipts received by him from renting or leasing motor vehicles for use in Oklahoma involve the 'Motor Vehicle Excise Tax', the 'Consumers or Sales Tax', and the 'Use Tax'. We find it unnecessary to consider the 'Use Tax' (see Title 68 O.S.1951 Chapter 29) under the record presented to this Court.
Although some of the statutory provisions to be considered have been amended since 1951, for the purpose of determining the issues herein, we find no amendments which materially affect the rights of either litigant. Therefore, we will consider the 1951 statutory provisions since most of the taxes were levied and paid prior to any amendments enacted by the 1961 Legislature.
The pertinent provisions of the 'Motor Vehicle Excise Tax Act' are:
Title 47 O.S.1951 § 52b, levies an excise tax of two percent of 'the value of each motor vehicle, * * * upon the transfer of legal ownership of any such vehicle registered in this State and upon the use of any such vehicle registered in this State * * *', except as otherwise provided in the act. This section further provides that 'In the event an excise tax is collected on the transfer of legal ownership or use of the vehicle during any calendar year, then an additional excise tax must be collected upon all subsequent transfers of legal ownership.' Title 47 O.S.1951 § 52e, provides that 'The excise tax levied by this Act is in lieu of all other taxes except: (a) annual vehicle registration and license fees; * * *', and other exemptions not material to the issues herein. The purpose for enacting the Motor Vehicle Excise Tax Act was to 'provide funds for General Governmental Functions of State Government.' (See Title 47 O.S.1941 § 52a).
The pertinent provisions of the 'Consumers or Sales Tax Act' are as follows:
Title 68 O.S.1951 § 1251c, levies an excise tax of two percent 'upon the gross proceeds or gross receipts derived from all sales * * *.' Thereafter listed are the types of sales subject to the tax. Sec. 1251a(c) provides that, * * *' (emphasis ours). Sec. 1251d specifically exempts from this tax the gross receipts or gross proceeds derived from * * *' (m) Sale of motor vehicles on which sale the Oklahoma Motor Vehicle Excise Tax has been paid.' Section 1251b provides that 97% of the revenues derived from the sales tax shall be paid to the State Treasurer and placed to the credit of the State Assistance Fund.
The Trustee argues that the term 'sale' as used in the exemption section (1251d(m) supra), of the sales tax act includes the leasing and rental of motor vehicles which results in the transfer of possession; and also, that the 'in lieu' section of the motor vehicle excise tax (52e) prohibits the imposition of a sales tax because of the payment of the motor vehicle tax since Sec. 52e of the act specifically provides that such taxes shall be in lieu of all taxes, except certain taxes not pertinent herein.
The Commission argues that when the levying section and the 'in lieu' section of the Motor Vehicle Excise Tax Act are considered with the exemption provision of the Sales Tax Act, it is obvious that the legislature did not intend that the Vehicle Excise Tax was either levied in lieu of, or excepted from the sales tax act the gross receipts from rentals of motor vehicles where there has been only a transfer of possession.
In construing the above statutory provisions we should be mindful of certain rules of law, which are: (1) The long-continued construction of a statute by a department of government charged with its execution is entitled to great weight and should not be overturned without cogent reasons; and where the legislature has convened many times during this period of administrative construction without expressing its disapproval, such silence may be regarded as acquiescence in or approval of the administrative construction. See Atlantic Refining Company v. Oklahoma Tax Commission, Okl., 360 P.2d 826; and Lincoln National Life Insurance Co. v. Read, 194 Okl. 542, 156 P.2d 368. (2) In the construction of statutes the intention of the legislature, when ascertained, must govern, and to ascertain the legislative intent, we are privileged to examine the previous legislative enactments relating to the subject matter. Board of Education of Oklahoma City v. State Board of Education, 197 Okl....
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