MOTOR VEHICLES ‑- EXCISE TAX ‑- LICENSES ‑- NONRESIDENT MILITARY PERSONNEL ‑- APPLICABLE STATE LAW.
Section 574, 50 United States Code Annot. (Soldiers' and Sailors' Civil Relief Act of 1940), exempts all nonresident military personnel stationed in Washington from the obligation of paying the motor vehicle excise tax required by chapter 199, Laws of 1963 (chapter 82.44 RCW) provided they pay all motor vehicle or excise taxes and fees required by the state of their residence or domicile. However, nonresident servicemen who wish to license their vehicles in this state must pay the license fees and excise taxes prescribed by law.
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December 5, 1963
Honorable C. W. "Red" Beck
State Representative, 23rd District
Route 5, Box 15
Port Orchard, Washington
Cite as: AGO 63-64 No. 72
By letter previously acknowledged you have requested an opinion of this office on the following paraphrased question:
Does § 574 of 50 U.S.C.A. App. (Soldiers' and Sailors' Civil Relief Act of 1940) preclude the application of our state motor vehicle excise tax (chapter 82.44 RCW as amended by chapter 199, Laws of 1963) to nonresident United States military personnel stationed in Washington?
We answer your question as set forth in the analysis.
Section 574 of 50 U.S.C.A. App. was amended in 1962, to include the sentence set forth below in brackets, and now reads as follows:
"(1)For the purposes of taxation in respect of any person, or of his personal property, income, or gross income, by any State, Territory, possession, or political subdivision of any of the foregoing, or by the District of Columbia, such person shall not be deemed to have lost a residence or domicile in any State, Territory, possession, or political subdivision of any of the [[Orig. Op. Page 2]] foregoing, or in the District of Columbia,solely by reason of being absent therefrom in compliance with military or naval orders, or to have acquired a residence or domicile in, or to have become resident in or a resident of, any other State, Territory, possession, or political subdivision of any of the foregoing, or the District of Columbia, while, and solely by reason of being, so absent. For the purposes of taxation in respect of the personal property, income or gross income of any such person by any State, Territory, possession, or political subdivision of any of the foregoing, or the District of Columbia, of which such person is not a resident or in which he is not domiciled, compensation for military or naval service shall not be deemed income for services performed within, or from sources within, such State, Territory, possession, political subdivision, or District, and personal property shall not be deemed to be located or present in or to have a situs for taxation in such State, Territory, possession, or political subdivision, or district. [Where the owner of personal property is absent from his residence or domicile solely by reason of compliance with military or naval orders, this section applies with respect to personal property,or the use thereof, within any tax jurisdiction other than such place of residence or domicile, regardless of where the owner may be serving in compliance with such orders:] Provided, That nothing contained in this section shall prevent taxation by any State, Territory, possession, or political subdivision of any of the foregoing, or the District of Columbia in respect of personal property used in or arising from a trade or business, if it otherwise has jurisdiction. This section shall be effective as of September 8, 1939, except that it shall not require the crediting or refunding of any tax paid prior to October 6, 1942." (Emphasis supplied.)
Subsection (2) of this section has not been amended since 1944, and reads as follows:
"When used in this section, (a) the term 'personal property' shall include tangible and intangible property (includingmotor vehicles), and (b) the [[Orig. Op. Page 3]] term 'taxation' shall include but not be limited to licenses, fees, or excises imposed in respect to motor vehicles or the use thereof: Provided, That the license, fee, or excise required by the State, Territory, possession, or District of Columbia of which the person is a resident or in which he is domiciled has been paid." (Emphasis supplied.)
Prior to the last session of our legislature chapter 82.44 RCW, dealing with motor vehicle excise taxes, contained in effect a tax exemption for motor vehicles owned by nonresident personnel of our armed forces stationed in this state. RCW 82.44.010 (4). In 1963, the legislature removed this exemption from RCW 82.44.010, thus making motor vehicles owned by such persons subject to this tax. Sections 1 and 2, chapter 199, Laws of 1963.
As can readily be seen the federal exemption first above noted is in direct conflict with our state motor vehicle excise tax law as thus amended. Section 574 of 50 U.S.C.A. App. expressly exempts nonresident United States military personnel from the duty of paying state or local motor vehicle license and excise feesif they have paid the required motor vehicle taxes and fees in the state of their residence or domicile. On the other hand, chapter 199, Laws of 1963, purports to require such persons to pay our state motor vehicle excise tax.
The question is: How is this conflict between state and federal law resolved? The United States Supreme Court considered this question in Dameron v. Brodhead, 345 U.S. 322, 97 L.Ed. 1041, 73 S.Ct. 721 (1952). In this case the soldier involved was a resident of Louisiana but was stationed in Colorado. Colorado exacted a personal property tax which he paid under protest. He sued to recover the amount of the tax and upon appeal the court held that since § 574 of 50 USCA App. states that personal property of nonresident military personnel does not have a situs for taxation in the state in which the person is stationed, this soldier was exempt from the Colorado personal property tax. The court went on to point out that Congress had the constitutional power to provide for such a tax exemption to prevent the burden of multiple taxation on military personnel at their different duty stations.
In the case ofWoodroffe v. Village of Park Forest, 107 Fed. Supp. 906 (1952), the petitioner was stationed in Illinois on military duty. He was a resident of Pennsylvania and had paid all the required license fees there, but respondent municipality required all persons residing therein to pay a motor vehicle tax. The court [[Orig. Op. Page 4]] held that under these facts § 574 of 50 U.S.C.A. App. exempted petitioner from the duty of paying this tax.
In the case ofWhiting v. City of Portsmouth, 202 Va. 609, 118 S.E.2d 505 (1961), the court stated that if the appellant had paid the license tax required by his permanent residence, he would be exempt under § 574, of 50 USCA App., from payment of a license tax in the state where he was assigned to military duty.
We believe these cases demonstrate by analogy that § 574 of 50 U.S.C.A. App. exempts all nonresident military personnel stationed in Washington from the obligation of paying the motor vehicle excise tax required by chapter 199, Laws of 1963, provided they have paid all motor vehicle or excise taxes and feesrequired by the state of their residence or domicile. It is irrelevant whether our state tax is in fact an excise tax or an ad valorem tax, because subsection (2) of the federal act, supra, exempts motor vehicles owned by nonresident military personnel from both of these types of taxes.
The effect of the legislative amendment to RCW 82.44.010 is that nonresident military personnel will not be able to license in Washington for the partial fee under RCW 46.16.060 ($6.90), but rather must pay the additional two percent excise tax if they choose to license their automobiles in Washington. As previously stated, they have the privilege of avoiding licensing in Washington if they license their automobiles in the state of their residence.
Because of the conclusion we have reached, we deem it unnecessary to discuss any other question raised by your inquiry. We trust the foregoing will be of assistance to you.
Very truly yours,
JOHN J. O'CONNELL
M. H. HEMMEN
Assistant Attorney General