Airport Hilton Ventures, Ltd. v. Utah State Tax Commission

HOWE, Chief Justice,

dissenting:

¶ 18 I dissent. In my opinion, rule R865-19S-79 is consistent with the taxing statutes that it implements.

¶ 19 It is important to bear in mind at the outset that it is the legislative intent that sales tax should be imposed on short hotel stays, but that stays of thirty days or more, which have residential characteristics, should not be taxed, just as the rental and leasing of homes and apartments are not taxed. In other words, the legislature intended to treat hotel stays of thirty days or more the same as it treats the rental and leasing of homes and apartments which are typically for one month or more. In the instant case, however, Hilton’s arrangement with the transportation companies is vastly different from the typical residential lease or rental arrangement. Here, we have short stays by different people in different rooms, and the transportation companies are billed at daily rates.

¶ 20 The majority apparently requires an administrative rule to be an exact mirror of the statute it implements. I agree that a rule may not expand or narrow the exemption in the statute. However, rules are used to apply statutes in particular circumstances and therefore must contain detail not found in the statutory language itself. The requirements in rule R865-19S-69 do not narrow the exemption, but simply impose requirements so that the legislative intent will be followed and the exemption will not be abused. The rule reasonably requires that in order for a stay of thirty days or more to be tax exempt, residency must be maintained continuously under the terms of a written agreement for thirty days or more. The written agreement must identify the specific room that will be occupied for the period. The room must be billed at a specified monthly rate, not an accumulation of daily rate. These requirements ensure that the legislative intent will be followed, i.e., that persons who reside in a hotel room for more than thirty days will be treated on a par with persons who might rent an apartment or a house for thirty days or more.

¶ 21 The requirement for a written agreement is not offensive since it simply furnishes proof for eligibility for the exemption. The requirement that a specific room must be identified ensures that a person will be occupying that room for thirty days or more, just as that person would in renting a home or apartment. The requirement that the room must be billed at a specified monthly rate again attempts to put the arrangement on par with that of a person renting or leasing an apartment or house for thirty days or more who are typically billed a monthly rate. Thus, I find nothing in the rule which narrows the exemption granted by the legislature. The rule simply ensures that the exemption will be given only in accordance with the legislative intent. The rule prevents the exemption from being utilized in situations other than where the legislature intended it to apply.

¶ 22 Justice RUSSON concurs in Chief Justice HOWE’s dissenting opinion.