Rent-A-Center East, Inc. v. Walther (Majority, with Concurring)
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The Supreme Court affirmed the judgment of the circuit court finding that certain rent-to-own leases were subject to the special excise tax on short-term rentals of tangible personal property levied by Ark. Code Ann. 26-63-301(b), holding that the circuit court did not err.
At issue was the assessment of short-term rental tax on transactions between Appellant, Rent-A-Center East, Inc., and its customers. The Arkansas Department of Finance (DFA) and Administration issued a notice of proposed assessment to Appellant for short-term rental tax, compensating-use tax, and interest. The proposed assessment was upheld. Appellant then filed a complaint seeking judicial relief from the tax assessment, alleging that DFA wrongly classified the rental-purchase-agreement transactions as "leases" or "rentals." The circuit court granted summary judgment for DFA. The Supreme Court affirmed, holding that the transactions at issue were taxable short-term leases and not nontaxable long-term leases.
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