Southeastern Kusan, Inc. v. South Carolina Tax Com'n, SOUTHEASTERN-KUSA

CourtUnited States State Supreme Court of South Carolina
Writing for the CourtLITTLEJOHN; LEWIS
Citation280 S.E.2d 57,276 S.C. 487
Parties, Appellants, v. SOUTH CAROLINA TAX COMMISSION and Robert Wasson, Chairman, John H. LaFitte,Jr., Commissioner, and Charles N. Plowden, Commissioner, Constituting theMembers of the South Carolina Tax Commission, Respondents.
Docket NumberSOUTHEASTERN-KUSA,No. 21501,INC
Decision Date23 June 1981

Page 57

280 S.E.2d 57
276 S.C. 487
SOUTHEASTERN-KUSAN, INC., Appellants,
v.
SOUTH CAROLINA TAX COMMISSION and Robert Wasson, Chairman,
John H. LaFitte,Jr., Commissioner, and Charles N. Plowden,
Commissioner, Constituting theMembers of the South Carolina
Tax Commission, Respondents.
No. 21501.
Supreme Court of South Carolina.
June 23, 1981.

Page 58

[276 S.C. 488] Dobson & Dobson, and B. Joel Stoudenmire, Greenville, for appellants.

Atty. Gen. Daniel R. McLeod, Deputy Atty. Gen. Joe L. Allen, Jr., and Senior Asst. Atty. Gen. G. Lewis Argoe, Jr., and Asst. Atty. Gen. Jackson E. Fields, Jr., Columbia, for respondents.

Charles W. Knowlton, of Boyd, Knowlton, Tate & Finlay, Columbia, for amicus curiae.

LITTLEJOHN, Justice:

Plaintiff Southeastern-Kusan, Inc. (Southeastern), pursuant to § 12-35-1440, Code of Laws of South Carolina (1976), seeks a refund of $67,769.11 sales tax and interest it paid under protest to defendant South Carolina Tax Commission (Tax Commission). The outcome revolves around our interpretation and application of the sales tax exemption in § 12-35-550(17).

The facts are not disputed. Southeastern manufactures plastic parts and sells them predominantly to other manufacturers where the parts become integrated into a final product, e. g., plastic components in furniture, in textile machinery, and in stereo equipment. Because these parts are generally custom ordered, a special mold must first be designed for each customer. The mold is inserted into and becomes a necessary part of Southeastern's machinery during production of the plastic parts and is then stored by the customer at Southeastern's plant for future orders. Southeastern bills the customer for the molds separately from its bills for plastic parts. No sales tax is added to the billings for the molds. The contest arises because the Tax Commission submits that sales tax should have been added and collected.

Under § 12-35-510, a 4% tax on the gross proceeds of sales is imposed generally upon every person within South [276 S.C. 489] Carolina in the business of selling at retail any tangible personal property. In § 12-35-550, however, the legislature has exempted from this 4% sales tax the proceeds derived from certain enumerated sales. Section 12-35-550(17) provides the following exemption:

"There are exempted from the provisions of this article (Retail License, Sales & Use Taxes)

....

(17) The gross proceeds of the sale of ... machinery used in ... processing and...

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19 practice notes
  • Johnson v. Collins Entertainment Co., Inc., No. 3:97-2136-17.
    • United States
    • United States State Supreme Court of South Carolina
    • April 28, 1999
    ...of a statute produces an absurd result will the court consider a different meaning. Southeastern-Kusan, Inc. v. South Carolina Tax Comm., 276 S.C. 487, 280 S.E.2d 57 (1981). The court will reject an interpretation of a statute which leads to absurd result that could not have been intended. ......
  • Cfre Llc v. Greenville County Assessor, No. 27032.
    • United States
    • United States State Supreme Court of South Carolina
    • August 29, 2011
    ...construction is our policy of strictly construing tax exemption statutes against the taxpayer. See Se.-Kusan, Inc. v. S.C. Tax Comm'n, 276 S.C. 487, 489, 280 S.E.2d 57, 58 (1981). “This rule of strict construction simply means that constitutional and statutory language will not be strained ......
  • Centex Int'l, Inc. v. S.C. Dep't of Revenue, No. 27288.
    • United States
    • United States State Supreme Court of South Carolina
    • September 20, 2013
    ...CFRE, LLC v. Greenville Cnty. Assessor, 395 S.C. 67, 74–75, 716 S.E.2d 877, 881 (2011) (citing Se.–Kusan, Inc. v. S.C. Tax Comm'n, 276 S.C. 487, 489, 280 S.E.2d 57, 58 (1981)). In fact, it is “[o]nly when the literal application of the statute produces an absurd result will we consider a di......
  • Hibernian Soc. v. Thomas, No. 0219
    • United States
    • Court of Appeals of South Carolina
    • March 20, 1984
    ...tax exemptions will not be strained or liberally construed in the taxpayer's favor. Southeastern Kusan, Inc. v. S.C. Tax Commission, 276 S.C. 487, 280 S.E.2d 57 (1981); Charleston County Aviation Authority v. Wasson, 277 S.Ct. 480, 289 S.E.2d 416 This is a case of first impression in South ......
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17 cases
  • Johnson v. Collins Entertainment Co., Inc., No. 3:97-2136-17.
    • United States
    • United States State Supreme Court of South Carolina
    • April 28, 1999
    ...of a statute produces an absurd result will the court consider a different meaning. Southeastern-Kusan, Inc. v. South Carolina Tax Comm., 276 S.C. 487, 280 S.E.2d 57 (1981). The court will reject an interpretation of a statute which leads to absurd result that could not have been intended. ......
  • Cfre Llc v. Greenville County Assessor, No. 27032.
    • United States
    • United States State Supreme Court of South Carolina
    • August 29, 2011
    ...construction is our policy of strictly construing tax exemption statutes against the taxpayer. See Se.-Kusan, Inc. v. S.C. Tax Comm'n, 276 S.C. 487, 489, 280 S.E.2d 57, 58 (1981). “This rule of strict construction simply means that constitutional and statutory language will not be strained ......
  • Centex Int'l, Inc. v. S.C. Dep't of Revenue, No. 27288.
    • United States
    • United States State Supreme Court of South Carolina
    • September 20, 2013
    ...CFRE, LLC v. Greenville Cnty. Assessor, 395 S.C. 67, 74–75, 716 S.E.2d 877, 881 (2011) (citing Se.–Kusan, Inc. v. S.C. Tax Comm'n, 276 S.C. 487, 489, 280 S.E.2d 57, 58 (1981)). In fact, it is “[o]nly when the literal application of the statute produces an absurd result will we consider a di......
  • Hibernian Soc. v. Thomas, No. 0219
    • United States
    • Court of Appeals of South Carolina
    • March 20, 1984
    ...tax exemptions will not be strained or liberally construed in the taxpayer's favor. Southeastern Kusan, Inc. v. S.C. Tax Commission, 276 S.C. 487, 280 S.E.2d 57 (1981); Charleston County Aviation Authority v. Wasson, 277 S.Ct. 480, 289 S.E.2d 416 This is a case of first impression in South ......
  • Request a trial to view additional results

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