Hearing set in Arkansas sales tax case

| 10/1/2003

A judge will decide Oct. 30 whether a suit against the state of Arkansas will include all affected truckers, or just the one company named in the suit.

The Arkansas Trucking Association and Wayne Smith Trucking sued the Arkansas Department of Finance and Administration May 23 over the agency’s attempt to collect back sales tax from truckers.

The state has asked Judge Ellen Brantley of Pulaski County Circuit Court, who is presiding over the case, to restrict the suit to just the one named plaintiff, Wayne Smith Trucking, and to not expand the case to class status, which would allow any affected trucker to benefit should the association win. Brantley has set a hearing on that motion at 1:30 p.m. Oct. 30.

Kidd told Land Line he wants to make a statement that more than just one trucker is affected.

“I’m appealing to anyone, owner-operator or trucking company, that has been forced to pay these back sales taxes to show up in that courtroom that day just to send a message to the judge that this affects more than one company,” he said.

The controversy erupted earlier this year when the International Registration Plan, an interstate compact regulating trucking fees, ruled that truckers who did not live in Oklahoma could no longer base plate there. That forced hundreds, perhaps thousands of truckers to move their plates to their home states.

Officials at the Arkansas Department of Finance and Administration contended the truckers would owe back taxes when the companies or individuals moved their truck registrations back to Arkansas, even though the truckers were considered legally registered at the time, and Arkansas had accepted IRP fees based on those registrations. The department contended that those truckers who were Arkansas residents and who had base plated outside of Arkansas did so illegally.

The state sales tax could run as high as $6,000 on a new rig.

Kidd said the plaintiffs want the state to return the back sales tax it has already collected.

It was not the first time the state of Arkansas had filed a motion to dismiss the suit. The state filed a motion in late June claiming the court has no jurisdiction in the case.

John Tice of the Department of Finance and Administration said the suit was filed under Article 16, Section 13 of the Arkansas State Constitution, which allows citizens to challenge the constitutionality of a tax or whether a particular expenditure was appropriate.

Since the association and Wayne Smith Trucking were not challenging the constitutionality of the sales tax, Tice said, the state wanted the court to end the suit.

The hearing on the state’s latest motion will be heard in the 16th Circuit Court Division of the Pulaski County Courthouse, Room 310.

--by Mark H. Reddig, associate editor

Mark Reddig can be reached at mreddig@landlinemag.com.