The Ohio Supreme Court has reversed the Board of Tax Appeals’ decision that a car manufacturer was the consumer of taxable repair parts and services provided free-of-charge to customers under its “goodwill-repair” program. The Ohio Supreme Court determined that the car buyers, who actually enjoyed the benefit of the services and took possession of the parts, were the consumers of both. The Court found that the manufacturer increased the selling price of the vehicles to cover the cost of anticipated future goodwill repairs, which indirectly charges the customer for the repairs. The court differentiated this from a situation where a customer purchases a warranty contract, which is a contractual right not to be charged for those parts and services. In that situation, the manufacturer is the end user of the parts and services because they are consumed during the manufacturer’s fulfillment of the warranty contract. Further, since sales tax is assessed on the full sales price of the vehicle, the consumer pays the necessary tax on the goodwill repairs and parts at the time of vehicle purchase. Since the car manufacturer is not considered the consumer, it did not incur a use-tax obligation when it paid its dealers for the repairs and replacement parts. (DaimlerChrysler Corp. v. Levin, Slip Opinion No. 2008-Ohio-259)