…
Taxpayer argues that it purchased the crane out of state with the
intent of reselling it, but due to the economy ended up using the crane in
Indiana (in correspondence to the Department Taxpayer stated that the crane was
used in Indiana for a month in 2009; Taxpayer also provided a link to an online
advertisement where the crane was listed for sale). Regarding use tax, IC §
6-2.5-3-2 states in relevant part: (a)
An excise tax, known as the use tax, is imposed on the storage, use, or
consumption of tangible personal property in Indiana if the property was
acquired in a retail transaction, regardless of the location of that transaction
or of the retail merchant making that transaction. (Emphasis added).
Taxpayer's crane does not come within IC § 6-2.5-3-4, which
states: (a) The storage, use, and
consumption of tangible personal property in Indiana is exempt from the use tax
if: (1) the property was acquired in a retail transaction in Indiana
and the state gross retail tax has been paid on the acquisition of that
property; or (2) the property was acquired in a transaction that is wholly or
partially exempt from the state gross retail tax under any part of IC 6-2.5-5, except IC
6-2.5-5-24(b), and the property is being used, stored, or consumed for the
purpose for which it was exempted.
(b) If a person issues a state gross retail or use tax exemption
certificate for the acquisition of tangible personal property and subsequently
uses, stores, or consumes that property for a nonexempt purpose, then the
person shall pay the use tax.
As noted above, 45 IAC 2.2-4-26(e) states in part that
"equipment or any other items used by or consumed by the contractor and
which do not become a part of the improvement to real estate are not
exempt...." Taxpayer purchased the crane out of state and did not pay
sales tax at the time of purchase; Taxpayer subsequently used the crane in
Indiana. Thus Taxpayer is subject to Indiana's use tax on the crane.
FINDING
Taxpayer's protest is respectfully denied.
http://www.in.gov/legislative/iac/20120229-IR-045120078NRA.xml.pdf
