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Business Taxes Law Guide—Revision 2024
Sales and Use Tax Annotations
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335.0000 Leases of Mobile Transportation Equipment— Regulation 1661
Annotation 335.0043.150
335.0043.150 Lease of a Component Part. A lease of a component part of an aircraft is not a lease of mobile transportation equipment under Regulation 1661 unless the component part is for use in transportation of persons or property. Thus, a temporary lease of an aircraft engine to a movie studio for use as a wind machine is not a lease of mobile transportation equipment. If the aircraft engine had been purchased under a resale certificate and had been leased to the movie studio (with the lessor collecting use tax from the lessee), and the property was then leased for use on an aircraft, the lessor would owe use tax measured by the purchase price of the engine but would be entitled to a credit for tax paid on the rental receipts basis. 5/6/75.