Appeal from the Order of the Board of Finance and Revenue in the case of In Re: CRH Catering Company, Inc., Docket No. RST-6252, dated August 23, 1983.
Murray I. Horewitz, with him, Thomas A. Bowlen, for petitioner.
Robert P. Coyne, Deputy Attorney General, with him, LeRoy S. Zimmerman, Attorney General, for respondent.
Judges MacPhail, Doyle and Colins, sitting as a panel of three. Opinion by Judge Colins.
[ 104 Pa. Commw. Page 92]
CRH Catering Co., Inc. (taxpayer), an owner/operator of automatic vending machines, challenges an order of the Board of Finance and Revenue (Board) which sustained the decision of the Board of Appeals pursuant to an assessment issued by the Commonwealth of Pennsylvania, Department of Revenue (Commonwealth), for the payment of additional sales tax accruing during the audit period August 1, 1979, to January 31, 1982. The Commonwealth's assessment included sales tax not remitted by taxpayer on reported sales of certain prepackaged food items dispensed by vending machine as well as a tax deficiency on admitted taxable sales resulting from taxpayer's method of calculating its tax liability.*fn1
[ 104 Pa. Commw. Page 93]
In accordance with Pa. R.A.P. 1571(f), the taxpayer and the Commonwealth have entered into and filed a Partial Stipulation of Facts which we will accept and adopt*fn2 as findings of fact for the purposes of this appeal. From those stipulations, and from our review of the evidence presented at a hearing on July 15, 1986, we make the following findings of fact:
1. Taxpayer is a Pennsylvania corporation engaged in the business of full line vending which includes industrial catering through the use of automatic vending machines.
2. During the audit period at issue, taxpayer served to the general public, through vending machines, a variety of foodstuffs and beverages including, but not limited to: milk and other dairy products, ice tea, lemonade, assorted juices, assorted ice cream novelties, pastries and assorted fresh fruits.
3. In order for a consumer to purchase the items in question as listed in Stipulation [No. 8] hereinafter set forth from the taxpayer's vending machines, a consumer must place money into the vending machine prior to the machine dispensing said item.
4. The food or beverage items dispensed from taxpayer's vending machines are served in a readily consumable state.
5. The Commonwealth treats all the sales from vending machines as taxable except sales such as sales of candy, chewing gum or sales at or from schools.
[ 104 Pa. Commw. Page 946]
. A field audit of the taxpayer's books and records was conducted by the [Commonwealth] for the period of August 1, 1979, to January 31, 1982, and an Assessment No. 61796 was mailed to the taxpayer on June 3, 1982. Said assessment was composed of the following:
Interest to 6/15/81 10,070.32
7. Taxpayer does not contest the use tax portion of the assessment.
8. When taxpayer filed its sales tax report, it did not calculate tax to be due on ice cream, hot canned food (soup and chili),*fn3 milk and juice. Taxpayer did not remit sales tax on the following sales:
Ice Cream 1/2 pint $83,387.38
Hot Canned Food 3 to 7 oz. ...