{
  "id": 8554679,
  "name": "GREGORY POOLE EQUIPMENT CO., INC. v. J. HOWARD COBLE, Secretary of Revenue State of North Carolina",
  "name_abbreviation": "Gregory Poole Equipment Co. v. Coble",
  "decision_date": "1978-11-07",
  "docket_number": "No. 7710SC862",
  "first_page": "483",
  "last_page": "488",
  "citations": [
    {
      "type": "official",
      "cite": "38 N.C. App. 483"
    }
  ],
  "court": {
    "name_abbreviation": "N.C. Ct. App.",
    "id": 14983,
    "name": "North Carolina Court of Appeals"
  },
  "jurisdiction": {
    "id": 5,
    "name_long": "North Carolina",
    "name": "N.C."
  },
  "cites_to": [],
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  "last_updated": "2023-07-14T21:32:33.594298+00:00",
  "provenance": {
    "date_added": "2019-08-29",
    "source": "Harvard",
    "batch": "2018"
  },
  "casebody": {
    "judges": [
      "Judge MORRIS concurs.",
      "Judge WEBB dissents."
    ],
    "parties": [
      "GREGORY POOLE EQUIPMENT CO., INC. v. J. HOWARD COBLE, Secretary of Revenue State of North Carolina"
    ],
    "opinions": [
      {
        "text": "HEDRICK, Judge.\nThe sole question raised on this appeal appeared in the parties\u2019 Stipulation of Facts as follows:\nAre retail sales of used tangible personal property subject to the local government sales tax when such property, having been accepted in trade by the vendor as a credit or part payment on the sales price of new property that was exempt from local sales tax under the provisions of G.S. 105-467 by virtue of delivery to a purchaser at a point outside the taxing county by the vendor or his agent or by a common carrier, is sold at retail and delivered to the purchaser within the taxing county in which the taxpayer has a place of business?\nThe trial court answered this question in the affirmative.\nNorth Carolina General Statute \u00a7 105-164.4(1) imposes a retail sales tax of 3\u00b0/o of the sales price of any article of tangible personal property sold at retail in this State. Among the exemptions and exclusions from the sales tax provided in G.S. \u00a7 105-164.13 appears the following:\nSales of used articles taken in trade, or a series of trades, as a credit or part payment on the sale of a new article, provided the tax levied in this Article is paid on the gross sales price of the new article.\nG.S. \u00a7 105-164.13(16).\nThe imposition of a local sales tax is authorized by G.S. \u00a7 105-467 with the following limitations:\nThe sales tax which may be imposed under this Article is limited to a tax at the rate of one percent (1%) of:\n(1) The sales price of those articles of tangible personal property now subject to the three percent (3%) sales tax imposed by the State under G.S. 105-164.4(1);\nThe exemptions and exclusions contained in G.S. 105-164.13 . . . shall apply with equal force and in like manner to the local sales and use tax authorized to be levied and imposed under this Article. A taxing county shall have no authority, with respect to the local sales and use tax imposed und'er this Article to change, alter, add to or delete . . . any exemptions or exclusions contained in G.S. 105-164.13, or which are elsewhere provided for.\n. . . However, no tax shall be imposed where the tangible personal property sold is delivered to the purchaser at a point outside the taxing county by the retailer or his agent, or by a common carrier.\nG.S. \u00a7 105-474 expresses the legislative intent that the provisions relevant to the state sales tax \u201cshall be applicable to this Article [authorizing a local sales tax] unless such provisions are inconsistent with the provisions of this Article.\u201d\nThe plaintiff first points out that the 3% state sales tax was paid on the sale of the new equipment for which the used equipment was accepted in trade, and thus, the exemption embodied in G.S. \u00a7 105-164.13(16) applied to the later sale of the used equipment. On this basis plaintiff argues that since the sale of the used equipment was not charged with the 3% state sales tax under the provisions of G.S. \u00a7 105-164.4(1), the express terms of G.S. \u00a7 105-467(1) prohibit the imposition of a local sales tax on the same transaction. The plaintiff refers to the language of G.S. \u00a7 105-467(1) authorizing a local sales tax on sales of articles \u201cnow subject to\u201d the 3% state sales tax, and argues that it permits the imposition of a local sales tax only if a state sales tax is collected and paid on the transaction.\nThe defendant responds that adoption of the plaintiff\u2019s interpretation of G.S. \u00a7 105-467(1) would reduce the language in the same section concerning exemptions and exclusions to mere surplusage. We agree. If the legislature had intend\u00e9d that the payment of local sales tax be required only when the 3% state sales tax was paid, it need not have included the assurance that the same exemptions and exclusions are applicable. We think the limitation of local sales tax to sales \u201csubject to\u201d the state sales tax refers not to those transactions for which a state sales tax is actually assessed, but to any transaction described in G.S. \u00a7 105-164.4(1) without regard to whether the transaction might be exempted or excluded from taxation by the operation of G.S. \u00a7 105-164.13. Thus, the plaintiff\u2019s exemption from state sales tax does not preclude the assessment of a local sales tax.\nAccording to G.S. \u00a7 105-467, the exemption from state sales tax applicable to the plaintiff\u2019s sale of used equipment applies \u201cwith equal force and in like manner to the local sales . . . tax.\u201d With respect to the state sales tax, this exemption is not available to sales of used articles previously accepted in trade for new articles unless the previous sales of new articles was taxed. Applying this exemption \u201cin like manner\u201d to the local sales tax it must be construed to require the payment of local sales tax on the previous sale of new articles in order for the exemption to be available. The plaintiff stipulated that it paid no local sales tax in Wake, New Hanover and Beaufort Counties on the previous sale of new equipment because the equipment was delivered to purchasers outside those counties. Thus, in our opinion the exemption contained in G.S. \u00a7 105-164.13(16) and applicable to local sales tax by G.S. \u00a7 105-467 is not available to the plaintiff in its sales of used equipment.\nOur conclusion finds support in a recent administrative ruling promulgated by the Secretary of Revenue. In Sales Tax Ruling 191 the Secretary confronted the question whether the exemption with which we are concerned applied to the sale of used articles which were taken in trade for new articles sold and delivered to purchasers outside North Carolina. The Secretary opined that since no state sales tax was paid on the out-of-state sale of new articles, the exemption was not available to the vendor when it later sold the used articles. The hypothetical presented in the ruling supposed and purported to resolve the same problem regarding the state sales tax as we face regarding the local sales tax. Its application to the case at hand is supported by the legislative declaration that \u201cadministrative interpretations made by the Commissioner of Revenue with respect to the North Carolina Sales and Use Tax Act . . . may be uniformly applied in the construction and interpretation\u201d of the statutes pertaining to the local sales tax. G.S. \u00a7 105-474.\nWe hold that the trial court correctly entered summary judgment in favor of the defendant. The judgment appealed from is affirmed.\nAffirmed.\nJudge MORRIS concurs.\nJudge WEBB dissents.",
        "type": "majority",
        "author": "HEDRICK, Judge."
      },
      {
        "text": "Judge Webb\ndissenting.\nI respectfully dissent from the majority opinion. G.S. \u00a7 105-467 which allows counties to impose a sales tax says:\nThe sales tax which may be imposed under this Article is limited to a tax at the rate of one percent (1%) of:\n(1) The sales price of those articles of tangible personal property now subject to the three percent (3\u00b0/o) sales tax imposed by the State under G.S. 105-164.4(1);\nIn this case no tax may be imposed by the State on the sale of the property in question. Since the State may impose no tax, I believe the counties may impose no tax.",
        "type": "dissent",
        "author": "Judge Webb"
      }
    ],
    "attorneys": [
      "Poyner, Geraghty, Hartsfield & Townsend, by Thomas L. Norris, Jr., and Curtis A. Twiddy, for the plaintiff appellant.",
      "Attorney General Edmisten, by Special Deputy Attorney General Myron C. Banks and Associate Attorney Marilyn R. Rich, for the State."
    ],
    "corrections": "",
    "head_matter": "GREGORY POOLE EQUIPMENT CO., INC. v. J. HOWARD COBLE, Secretary of Revenue State of North Carolina\nNo. 7710SC862\n(Filed 7 November 1978)\n1. Taxation \u00a7 31.1\u2014 limitation of local sales tax \u2014 exemption from State sales tax\nThe limitation of local sales tax by G.S. 105-467(1) to sales \u201csubject to\u201d the State sales tax refers not to those transactions for which a State sales tax is actually assessed, but to any transaction described in G.S. 105-164.4(1) without regard to whether the transaction might be exempted or excluded from taxation by G.S. 105-164.13. Thus, an exemption from the State sales tax does not preclude the assessment of a local sales tax.\n2. Taxation \u00a7 31.1\u2014 sale of used equipment accepted as trade-in \u2014 exemption from State sales tax \u2014subjection to local sales tax\nWhere used equipment was accepted by a vendor as a trade-in on the sale of new equipment, and the 3% State sales tax was paid on the sale of the new equipment but the sale was exempt from the local sales tax under G.S. 105-467(1) because the equipment was delivered to the purchaser outside the taxing county, the vendor\u2019s subsequent retail sale of the used equipment to a purchaser in the taxing county was subject to the local sales tax even though it was exempt from the State sales tax under G.S. 105-164.13(16), since the sale of the used equipment was not exempt from the local sales tax unless the local sales tax had been paid on the sale of the new equipment.\nJudge Webb dissenting.\nAPPEAL by plaintiff from Godwin, Judge. Order entered 28 September 1977 in Superior Court, WAKE County. Heard in the Court of Appeals 15 August 1978.\nPlaintiff instituted this action by complaint filed 26 July 1976 seeking to recover a refund for an alleged overpayment of sales tax resulting from defendant\u2019s erroneous interpretation of the pertinent statute, G.S. \u00a7 105-467. The defendant in answer admitted the essential facts recited in the plaintiff\u2019s complaint but asserted that its assessment of sales tax to the plaintiff\u2019s sales was in accordance with the North Carolina General Statutes. On 11 July 1977 the parties stipulated to the following facts:\nThe plaintiff, a Delaware corporation qualified to transact business in North Carolina, is engaged in the business of selling industrial equipment and machinery. Prior to June, 1971, the plaintiff accepted certain used machinery in partial payment on the purchase price of new machinery sold to purchasers outside Wake, New Hanover, and Beaufort Counties. The plaintiff paid a 3% sales tax on the machinery sales as required by G.S. \u00a7 105-164.4(1), but did not pay the local sales tax in the three above counties since the equipment was sold and delivered to purchasers outside their borders. During the period beginning 1 June 1971 and ending 31 May 1974, the plaintiff sold the used equipment previously taken in trade to purchasers within Wake, New Hanover, and Beaufort Counties. The plaintiff failed to pay state or local sales tax on these sales.\nOn 14 November 1975 the defendant audited the plaintiff\u2019s books and determined that the above sales of used machinery were subject to local sales tax. The defendant then notified the plaintiff of its assessments of additional local sales tax, penalties, and interest. Soon thereafter a hearing was conducted at which the defendant affirmed the assessment of tax and interest but eliminated the penalty charged. Pursuant to the defendant\u2019s determination, on 17 November 1975 the plaintiff paid to the defendant $65,433.53, and immediately filed for refund of tax in the amount of $10,859.24 plus interest.\nOn the basis of these facts each party filed a motion for summary judgment. On 28 September 1977 the trial court entered judgment in which it found facts as stipulated and concluded \u201c[t]hat Plaintiff is not entitled to a refund of taxes and interest remitted to Defendant on the sales price of used equipment taken in trade.\u201d From the entry of summary judgment in favor of the defendant, the plaintiff appealed.\nPoyner, Geraghty, Hartsfield & Townsend, by Thomas L. Norris, Jr., and Curtis A. Twiddy, for the plaintiff appellant.\nAttorney General Edmisten, by Special Deputy Attorney General Myron C. Banks and Associate Attorney Marilyn R. Rich, for the State."
  },
  "file_name": "0483-01",
  "first_page_order": 511,
  "last_page_order": 516
}