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Keywords

statuteappealleasetax lawregulationappellant
trialmotionsummary judgmentleaseappellantmotion for summary judgment

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Register Mobile Advertising, Inc. v. Strickland, 242 Ga. 604, 250 S.E.2d 468

Facts

The appellant owns mobile advertising signs that he leases to customers for advertising purposes. The signs are placed on the customers' premises or other locations accessible to the appellant. While the appellant is responsible for the physical placement, maintenance, and repair of the signs, the customers ultimately decide how the signs are arranged and where they are placed. The State Revenue Commissioner assessed these transactions as rentals of tangible personal property subject to sales and use tax, leading to the taxpayer's appeal.

The appellant owns mobile advertising signs, which he leases to customers for the purpose of advertising their businesses. The signs are placed either on the premises of the customers' businesses or at other locations throughout the area which the appellant owns or to which he has access.

Issue

Whether the leases of advertising signs by the taxpayer are taxable leases of tangible personal property or exempt personal service transactions.

Whether the leases of advertising signs by the taxpayer are taxable leases of tangible personal property or exempt personal service transactions.

Rule

Leases of tangible personal property are subject to sales and use tax under Code Ann. s 92-3403aG, and an agreement granting rights to possess, control, or use personalty at a stated location is considered a lease, making the rental charge taxable.

The revenue commissioner argues that the transactions in which the taxpayer is engaged are leases of tangible personal property, taxable under Code Ann. s 92-3403aG, supra.

Analysis

The court analyzed the nature of the leases and determined that, despite the taxpayer's responsibilities for the signs, the customers had the ultimate decision-making authority regarding the placement and duration of the signs. This control indicated that the leases fell under the definition of taxable leases of tangible personal property as outlined in the relevant statutes and regulations.

Thus, when the signs are placed on the customer's property, the customer has the right to possess, control, and use the signs; when the signs are placed on property of the appellant, the customer still retains, at the least, the right of control.

Conclusion

The court affirmed the lower court's ruling, concluding that the taxpayer's leases of advertising signs were indeed taxable under the applicable sales and use tax laws.

We hold that the trial court did not err in granting the revenue commissioner's motion for summary judgment.

Who won?

The State Revenue Commissioner prevailed in the case because the court found that the leases constituted taxable transactions under the law.

The State Revenue Commissioner determined that these transactions are rentals of tangible personal property subject to a sales and use tax assessment under Code Ann. s 92-3403aG (Ga.L.1951, pp. 360, 363, as amended).

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