The Indiana Department of Revenue issued a Letter of Findings denying a taxpayer’s request for abatement of sales tax assessed on the sale of prepaid voice over internet calling cards. The taxpayer, a grocery business, sold prepaid voice over internet calling cards. The Department of Revenue stated that the sale of such cards is subject to tax because the customers purchased the cards so that they could use telephones to call persons in other locations for an already predetermined number of minutes. The taxpayer also argued that the method in which the auditor calculated the sales tax due on the calling cards was incorrect. Due to lack of evidence in certain cases, the auditor calculated tax based on the average markup of the calling cards. Where evidence was provided, the auditor calculated tax based on the taxpayer’s accumulated cost of the phone cards. (Letter of Findings, No. 03-0313, Indiana Department of Revenue, December 1, 2004)