Taxation – Sales Tax – Partial Exemption – ‘Motor Vehicle’ – ATVs & UTVs

Because S.C. Code Ann. Title 12 does not define “motor vehicle,” the administrative law court properly determined that it must use the rules of statutory construction to ascertain and effectuate the intent of the legislature to determine if the sales of ATVs and UTVs are entitled to the partial sales tax exemption found in S.C. Code Ann. § 12-36-2110(A). The clear language of § 12-36-2110(A) does not restrict or condition the exemption to motor vehicles that are used on highways. The dictionary definitions of a motor vehicle are an “automotive vehicle not operated on rails” and a “self-propelled wheeled conveyance, such as a car or truck, that does not run on rails.” ATVs and UTVs are motorized, self-propelled, wheeled, and do not run on rails. Further, appellant South Carolina Department of Revenue directs us to Title 56, which in S.C. Code Ann. § 56-1-10(20) defines an ATV as “a motor vehicle measuring fifty inches or less in width, designed to travel on three or more wheels and designed primarily for off-road recreational use . . . .” Therefore, we find the decision of the ALC that ATVs and UTVs are motor vehicles under § 12-36-2110(A) is supported by substantial evidence.

We affirm the ALC’s determination that retail sales of all-terrain vehicles and utility task vehicles are entitled to the partial sales tax exemption of § 12-36-2110(A).

Because we find the ALC correctly determined that ATVs and UTVs are motor vehicles under § 12-36-2110(A), we also find the ALC correctly found SCDOR’s interpretation of § 12-36-2110(A) was not entitled to deference. We also find the ALC correctly found SCDOR is not entitled to deference of its interpretation of Title 56, which is administered by the Department of Motor Vehicles, not SCDOR.

Jack’s Custom Cycles, Inc. v. South Carolina Department of Revenue (Lawyers Weekly No. 011-027-23, 13 pp.) (Paula Thomas, J.) Appealed from the Administrative Law Court (Ralph King Anderson, Ch. ALJ) Substituted opinion. Nicole Martin Wooten, Marcus Dawson Antley and Jason Phillip Luther for appellant; John Aaron Ecton and Margaret Weatherly Dukes for respondent. South Carolina Court of Appeals