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The Massachusetts Supreme Court reversed a decision made by the Appellate Tax Board and ruled that a New Hampshire tire seller was not liable for Massachusetts sales tax on sales made to Massachusetts residents in New Hampshire. The Department argued that due to the seller’s knowledge of the customers’ residence, the seller should have known the tires would be used in Massachusetts and, therefore, should have collected sales tax. After a review of a vendor’s liability for use tax, the Court denied the Commissioner’s arguments because the language in Massachusetts statute does not allow for the presumption of use that the Commissioner seeks to impose. Accordingly, the Appellate Tax Board’s decision was reversed. The court mentioned that the Legislature may, of course, enact such a presumption, but in the absence of any such statutory authorization, it is error to rely on a presumption that tires sold to a Massachusetts resident outside the Commonwealth were actually used in the Commonwealth. (Town Fair Tire Centers, Inc v. Commissioner of Revenue, Massachusetts Supreme Judicial Court, No. SJC-10360, August 25, 2009)

(09/02/2009)

Technical information release provides immediate information regarding tax laws focused physical areas of grocery stores, convenient stores and gas stations. Food prepared on the premises, as defined in Rev 701.16, which could reasonably be perceived as competing with an eating establishment that is primarily in the restaurant business, is taxable. Examples include: sandwiches, beverages in unsealed containers, salad bar and self-serve food carts, hot food items, party platters and prepared ready to eat products. The following examples are not taxable: wholly packaged food products and beverages, deli items, pre-packaged bakery items, single serving bakery products and whole, multiple serving bakery products. (Technical Information Release TIR 2007-005, New Hampshire Department of Revenue Administration, August 7, 2007)

(08/22/2007)

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