The opinion of the court was delivered by: Small
Plaintiff, D.P.S. Acquisition Corp., trading as Dependable Power Sweeping ("DPS"), challenges an assessment made by defendant, Director of Taxation ("Director"), under the New Jersey Sales and Use Tax Act. N.J.S.A. 54:32B-1 to -29. The amount of the assessment is not in dispute. The matter is submitted on stipulated facts pursuant to R. 8:8-1(b). The sole issue before this court is whether the services provided by DPS are exempt from sales tax as "garbage removal" pursuant to N.J.S.A. 54:32B-3(b)(4).
The Division of Taxation, following an audit and notice of assessment, made a final determination that DPS was liable for sales and use tax totaling $22,503.15, plus penalties and interest, for the period of April 1, 1989 through December 31, 1991. The basis of the determination was that the taxpayer's services were in the nature of sweeping parking lots, and thus taxable under N.J.S.A. 54:32B-3(b)(4). DPS appealed the determination by timely filing a complaint with the Tax Court, asserting that it was in the service of garbage removal and thus exempt from sales and use tax under the statute.
The stipulation of facts consists of six numbered paragraphs and a footnote. Rather than paraphrase the carefully negotiated agreement of the parties, the entire "Joint Statement of Facts" is quoted in full as the court's finding of facts.
During the taxable period 1989-1991, Plaintiff was in the business of performing the following operations:
1. Plaintiff owned a self-propelled vehicle which has an integrated section that is capable of collecting dirt and/or other articles. ***
2. Plaintiff contracted to travel across parking lots in this vehicle to collect dirt and/or other articles in the path of the vehicle.
3. There is a container which holds the dirt and/or other articles in the integrated section of the vehicle that is collected as the vehicle travels across the parking lots.
4. When the container in the integrated section of the vehicle was filled, it had to be emptied by Plaintiff. Plaintiff emptied this container into one or more dumpsters, which were not the property of Plaintiff, located on Plaintiff's customers' premises.
5. For the convenience of Plaintiff, the container in Plaintiff's vehicle was generally emptied only when it was full. Since not every parking lot Plaintiff contracted to clean generated enough dirt and/or other articles to fill the container, Plaintiff decided when to empty the container, but Plaintiff had the right to empty its container at each and every site at which it operated.
6. Plaintiff did not own, control, operate or in any other way possess or pay any fees relative to the dumpster(s) into which Plaintiff emptied the container attached to its vehicle. The dumpsters, which had the names of unrelated entities printed on them, were emptied by the unrelated entities into their vehicles, which carried away from the site all of the contents of the dumpsters, including the dirt and/or other articles emptied by Plaintiff from its vehicle's container.
***For the purpose of the Joint Statement of Facts, the term "dirt and/or other articles" is defined to include, but is not limited to, dirt, gum wrappers, cigarette butts, food wrappers and containers, remnants of discarded food stuffs, cans, bottles and the like.
N.J.S.A. 54:32B-3 provides for the imposition of a tax of 6% upon
(b) The receipts from every sale, except for resale, of the ...