28 Ohio St. 2d 171 | Ohio | 1971
Appellant, Garth Oberlander, doing business as Garth’s Auction, is a licensed auctioneer who specializes in the sale of antiques. Except for merchandise which he owns, he does not take title to any property auctioned. Before each auction is conducted, appellant con
During the three-year- audit period, appellant conducted approximately 15 to 20 auctions per year, receiving from $30,000 to $40,000 per auction. The record discloses that appellant collected and remitted sales tax on merchandise auctioned which was either owned by him or owned by a dealer holding a vendor’s license. However, he did not collect a sales tax on any other property which was auctioned, including sales by an executor, private collection sales and court-ordered sales.
Because appellant did not collect the tax on these latter transactions he was personally assessed for the tax. R. C. 5739.13.
Appellant advances three contentions, each of which will be discussed separately.
Appellant contends, first, that all the antiques auctioned by him are tax-exempt casual sales.
Appellee contends that, under Rule TX-15-17, Rules of the Tax Commissioner,
A “casual sale” is defined as “a sale of an item of tangible personal property which was obtained by the person making the sale, through purchase or otherwise, for his own use in this state.” (Emphasis added.) R. C. 5739.01-(M). The import of this definition is that the person selling the item did not obtain it for the purpose of resale. To qualify for the casual sale exemption the person making the sale must have acquired the tangible personal property for his own use in this state.
However, reference must be made to other sections of the Revised Code to determine who is the person making the sale.
“Sale” is defined as including “all transactions by which title or possession, or both, of tangible personal property, is or is to be transferred * # * for a consideration.” R. C. 5739.01(B).
“Vendor” is broadly defined as “the person by whom transfer effected or license given by a sale is or is to be made or given.” R. C. 5739.01(C). (Emphasis added.)
A combined reading of those statutory definitions reveals that the person making the sale is the person who effects a transfer of title or possession, or both, of tangible personal property for a consideration Compare R. C. 1302.41(B). To be a vendor, within the meaning of R. C. 5739.01(C), it is not necessary that one actually transfer title to or possession of tangible personal property. The vendor is the person by whom the transfer is effected. Therefore, even though appellant took no title to the property auctioned, he is still a vendor within the meaning of R. C. 5739.01(C).
Since appellant did not acquire the property for his own use in this state, the sales are not “causal,” and he cannot validly claim an exemption under R. C. 5739.02(B) (8).
“Sales made in more or less continuous succession cannot be said to be casual or isolated. Occassional sales, made by one not engaged in the business of selling, may be casual * * * but if the characteristic of systematic recurrence and continuity in respect to such sales is developed, they cease to be occasional, casual or isolated.”
This element of systematic recurrence is present when an auctioneer conducts 15 to 20 auctions per year at times deemed appropriate by him and makes substantial gross sales in connection therewith. Compare R. C. 5739.02(B) (9).
Appellant contends next that Rule TX-15-17 is discriminatory in that the merchandise which he auctions in his own building is made taxable, while the same merchandise, if sold on property not owned by him, is not made taxable.
Appellant’s interpretation of the rule is erroneous. By statute, the vendor is made the collector of the tax. R. C. 5739.03. Under R. C. 5739.05 the Tax Commissioner is authorized to promulgate rules which he deems necessary to administer the sales tax Act. Rule TX-15-17 merely specifies who is to collect the tax when the auction is conducted on premises owned by the auctioneer. The rule does not make appellant’s sales taxable.
The second paragraph of Rule TX-15-17 states that if the auction is conducted at the “owner’s place of business * * * the owner is responsible for the collection of the tax.” This paragraph applies only where the owner of the auctioned merchandise is engaged in the business of selling tangible personal property. All other auctions not covered by Rule TX-15-17 are governed by Rule TX-15-28, which generally provides that persons (auctioneers) engaged in the business of selling tangible personal property belonging to another are the vendors and shall be responsible for the collection of the tax. Both rules deter
Appellant contends next that its sales of antiques to the Ford Foundation were exempt from the sales tax under R. C. 5739.02(B) (12).
The board found that no evidence was introduced to show that the Ford Foundation was a charitable organization within the meaning of R. C. 5739.02(B) (12). Since the appellant did not offer a,ny evidence to show that the Ford Foundation was “operated exclusively for charitable purposes in this state,” and there is no evidence in the record on that question, this court cannot speculate whether the exemption is applicable.
For the above reasons, the decision of the Board of Tax Appeals is affirmed.
Decision affirmed.
TX-15-17, Rules of the Tax Commissioner.
“Where auction sales are conducted at regular or frequent intervals by the same person * * * at a place of business subject to * * * [his] control, the person * * * conducting such sales must * * * collect the tax regardless of whether the merchandise sold is owned by * * * [him] or by other individuals who have contracted to páy * * * for the services of the auctioneer in making the salé.” - - '■