Government Suppliers and Contractors (Rescinded November 30, 2000)

AUTHORITY: section 144.270, RSMo 1994. This rule was previously filed as rule no. 1 Jan. 22, 1973, effective Feb. 1, 1973. S.T. regulation 030-7 was last filed Dec. 31, 1975, effective Jan. 10, 1976. Refiled March 30, 1976. Amended: Filed Aug. 13, 1980, effective Jan. 1, 1981. Amended: Filed Sept. 7, 1984, effective Jan. 12, 1985. Rescinded: Filed May 24, 2000, effective Nov. 30, 2000. State ex rel. Thompson-Stearns-Roger v. Schaffner, 489 SW2d 207 (1973). The legislature’s repeal of old section 144.261 and enactment of new section 144.261 abolished the need for review by the tax commission before judicial review could be sought. Act can only properly be held to have intended to restore the prior system of direct judicial review, without intervening administrative review, of the director’s (of revenue) decisions in sales tax matters. Therefore, after the director had rejected claimant’s request for refund of sales and use tax, claimant was entitled to direct judicial review by mandamus, without need to seek review of decision by State Tax Commission. United States v. New Mexico, 455 U.S. 720, 102 S.Ct. 1373 (1982). New Mexico’s sales tax was not invalid as applied to purchases made by contractors having contracts with the federal government for construction and repair work on governmentowned property, even where title passed directly from vendors to the federal government. Overland Steel, Inc. v. Director of Revenue, 647 SW2d 535 (Mo. banc 1983). There were two issues in this case. The first was whether a taxpayer could claim a sales tax exemption for certain steel if sold, on the grounds that the purchasers were to use it in pollution control or plant expansion projects. The second was whether or not the transfer of steel to certain customers in Kansas was a sale subject to sales tax under the Commerce Clause of the United States Constitution. With respect to the first issue, the court found that the taxpayer had the burden of establishing that it was exempt from sales tax, and its failure to produce sales tax exemption certificates, coupled with the dearth of testimony concerning the exempt activities of taxpayer, fails to meet that burden. With respect to the second issue, the court found that when property is purchased subject to a resale certificate, the purchaser becomes liable for sales tax if the property is not resold. In this case the court found that because the taxpayer used the steel in question in its capacity as a contractor there was no resale. Therefore, the taxable event was the taxpayer’s original purchase of the steel in Missouri. It was wholly irrelevant that the construction contract pursuant to which the steel was used was performed in Kansas. There was no violation of the Commerce Clause, and therefore, taxpayer was liable for tax. Planned Systems Interiors, Ltd. v. Director of Revenue, Case No. RS-85-0065 (A.H.C. 7/1/86). The petitioner’s theory was that it was making a sale to an agency of the United States government and could not be required to pay sales tax. The Administrative Hearing Commission rejected petitioner’s contentions and found that the taxpayer had a contractual relationship only as a subcontractor with K & S, the primary contractor and that the taxpayer sold the work stations to K & S pursuant to their contract. Under the department’s regulations 12 CSR 10-3.028 and 12 CSR 10-3.262, this sale was subject to sales tax.