Walmart Entity Qualifies for Resale Exemption in Missouri: Supreme Court Decision

• Walmart Starco is exempt from use tax on its purchases of information technology equipment
• Starco purchased equipment for resale to other Walmart subsidiaries
• Starco claimed a resale exemption and did not remit Missouri use tax on the purchases
• Some equipment needed additional software or hardware to meet specifications
• Starco loaded necessary software or hardware, tested it, and packaged it for resale
• Starco charged the cost of the equipment plus a fixed-percentage markup
• The subsidiaries purchasing the equipment remitted use tax to the jurisdictions where it was delivered
• The Director of Revenue assessed use tax against Starco, but the Commission determined Starco qualified for the resale exemption
• The Director claimed Starco did not hold equipment solely for resale, but the Court disagreed
• The Court found that the equipment was exempt from use tax to avoid double taxation
• The Court distinguished this case from a previous case relied upon by the Director
• The Court affirmed the Commission’s decision that Starco qualifies for the resale exemption.

Source: salestaxinstitute.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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