Opinion Number ( 2003 )

Dear Sheriff Jones and Mr. McCorquodale:

You each requested the opinion of this office concerning the rebate by a law enforcement district of sales taxes.

In Op.Atty.Gen. 02-0287 requested by Sheriff Jones, this office concluded that under the Enterprise Zone Act, R.S. 51:1781, et seq., the only entities which are authorized to rebate sales taxes are local governmental subdivisions, which is limited to parishes and municipalities. Accordingly, a District could not rebate its sales taxes as an enterprise zone incentive without violating La. Const. Art. VII, Sec. 14. This remains the opinion of this office.

We then received a request from Mr. McCorquodale asking whether Op.Atty.Gen. 02-0287 concluded that any type of tax credit involving a law enforcement district is inappropriate. In Op.Atty.Gen. 02-0287(A), we concluded that tax exemptions must be specifically conferred by the legislature and law enforcement districts can only agree to a reduction of sales taxes or give a tax credit in instances specifically authorized by law. This remains the opinion of this office.

The question arises because in Op.Atty.Gen. 02-0287(A), we quoted from R.S. 47:301(14)(g)(i) the definition of "sales of services", which provides in pertinent part:

(14) "Sales of services" means and includes the following:

(g)(1) The furnishing of repairs to tangible personal property, including but not restricted to the repair and servicing of automobiles and other vehicles, electrical and mechanical appliances and equipment, watches, jewelry, refrigerators, radios, shoes, and office appliances and equipment. Charges for the furnishing of repairs to tangible personal property may be excluded from sales of services, as defined in this Subparagraph, when the repaired property is delivered to the customer in another state either by common carrier or the repair dealer's own vehicle, however, as to aircraft, delivery may be by the best available means. This exclusion shall not apply to sales and use taxes levied by any parish, municipality or school board. However, any parish, municipality or school board may apply the exclusion as defined in this Subparagraph to sales or use taxes levied by any such parish, municipality, or school board. Offshore areas shall not be considered another state for the purpose of this Subparagraph. (Emphasis added)

In other words, repairs are a taxable transaction for purposes of sales tax. However, as set forth in the italicized sentences above, there is an exclusion for a certain type of repair, namely, "charges for the furnishing of repairs to tangible personal property when the repaired property is delivered to the customer in another state either by common carrier or the repair dealer's own vehicle, however, as to aircraft, delivery may be by the best available means."

This exclusion does not apply to sales and use taxes levied by a parish, municipality or school board. Law enforcement districts are not contained in this list, therefore, the exclusion does apply to a law enforcement district. Accordingly, if the repaired property is delivered to the customer in another state by common carrier or the repair dealer's vehicle, this is not a sale of services and thus should be excluded from the law enforcement district's sales tax.

Trusting this clarifies our previous opinions, we remain

Very truly yours,

RICHARD P. IEYOUB

ATTORNEY GENERAL

BY: ________________________________ MARTHA S. HESS Assistant Attorney General

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DATE RELEASED: August 15, 2003