Thе sole issue on appeal is whether goods held out for rental may be classified as “merchants’ stock-in-trade” thereby qualifying it as personal property exempt from taxation under sec. 70.111(17), Stats. The statute allows exemptions from general property taxes for “merchants’ stock-in-trade, manufacturers’ materials and finished products and livestock.” We conclude that рersonal property held out for rental is not “stock-in-trade” as that term is used in the statute; therеfore, we reverse the judgment of the trial court.
Falls Rental World, a/k/a L & R Rentals (FRW), is in the business of renting personal property to others. This property generally consists of party goods, equipment used outside the hоme, and medical equipment. FRW also holds some property out for sale which is not subject to rental. The property in dispute was held out for rental use by its customers.
Property is occasionally removed from the rental group and sold. Generally, former rental equipment is sold because it is no longer usable as rental property or because a rental customer has asked to purchase the property from FRW. However, the trial court found that FRW’s primary purpose was to solicit customers to rent its property.
The Village of Menomonee Falls сommenced an action in 1983 to collect delinquent personal property taxes of $857.89 owed hy FRW. It subsequently commenced a second action against FRW to collect delinquent рersonal property taxes for 1984 in the amount of $691.32. These amounts were based on the totаl assessed value of FRW’s personal property for the taxable years in question. FRW contеnded that personal *396 property held out for rental was exempt under sec. 70.111(17), Stats.
Pursuant to thе stipulation of the parties, the cases were consolidated for hearing in the circuit сourt. The trial court held that substantially all of FRW’s property in both cases was exempt under seс. 70.111(17), Stats., as merchants’ stock-in-trade.
On appeal, FRW argues that before a tax may be impоsed, the objects of taxation must be reasonably described by the language of the statute аnd that any ambiguities must be resolved in favor of the person upon whom the tax is sought to be imposed.
Kearney & Trecker Corp. v. Department of Revenue,
The application of a statute to a particular set of facts is a question of law.
Bucyrus-Erie Co. v. DILHR,
A tax exemption statute is to be strictly construed against granting an exemption.
Pabst Brewing Co. v. City of Milwaukee,
When no statutory definition or case law exists to define a term in a statute, the common and generally understood meaning of the term should be applied.
State (Bd. of Regents) v. City of Madison,
Courts in other jurisdictions concur in these definitions of “merchant” and “stock-in-trade.” City
of Boston v. Mac-Gray Co., Inc.,
We conclude that the property at issue is not exempt from tаxation under the plain meaning of the statute. FRW has failed to meet its burden under Ladish of showing that the terms of sec. 70.111(17), Stats., clearly apply to property held out for rental.
FRW is selling a service. Its stoсk-in-trade, if it exists, is the performance of its goods and equipment. FRW is in the business of renting party goods, equipment used outside the home, and medical equipment. It is not in the business of selling these items. It does not, therefore, meet the definition of a merchant.
In addition, FRW’s property held out for rental cannot consistently be construed as “goods kept for sale.” Consequently, this property does not meet the definition of stock-in-trade and is thus not exempt from personal property tаxes under sec. 70.111(17), Stats.
By the Court. — Judgment reversed.
Notes
This definition is consistent with an opinion issued by the attorney general in 1963 in which he interрreted the meaning of “merchants’ stock-in-trade” as it was used in sec. 77.64, Stats. (1963). That section provided for tax credits on “merchants’ stock-in-trade, manufacturers’ materials and finished products, and livestock.” 52 Op. Att’y Gen. 387,388 (1963).