STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MICCOSUKEE TRIBE OF INDIANS ) OF FLORIDA, )

)

Petitioner, )

)

vs. ) CASE NO. 88-6064

) 88-6216

STATE OF FLORIDA, DEPARTMENT ) 88-6297

OF REVENUE and COMPTROLLER OF ) THE STATE OF FLORIDA, )

)

Respondent. )

)

RECOMMENDED ORDER

In these consolidated cases Petitioner is seeking sales tax refunds pursuant to Section 215.26, Florida Statutes. According to the petitions filed by Petitioner, the sales tax revenues in question were generated by business activities conducted by Petitioner, a federally recognized Indian tribe, on federal Indian reservation land. Therefore, Petitioner contends in its petitions, these monies were paid to the State in error inasmuch as the State has no authority under federal Indian law to tax such on-reservation activity. The petitions were referred to the Division of Administrative Hearings by Respondent Department of Revenue in early December, 1988.

On December 22, 1988, Respondents filed motions requesting that the instant petitions be dismissed on the ground that Petitioner is without standing to seek refunds of the sales tax monies in question because these monies were actually paid by Petitioner's customers and not by Petitioner. In support of their position, Respondents cited the case of State ex rel. Szabo Food Inc. of North Carolina v. Dickinson, 286 So.2d 529 (Fla. 1973), wherein the Florida Supreme Court, in holding that a vending machine company was not entitled to a refund of monies paid as taxes on the sale of items from its machines, stated in pertinent part:

The sales tax imposed by Fla. Stat., Chapter 212, F.S.A., requires that such tax be collected from the purchaser or consumer. Szabo is a seller and was required to collect the tax from the purchaser or consumer, Fla. Stat. (1969).

Sec. 212.07(1), F.S.A. This statute requires the dealer, as far as practicable, to add the tax to the selling price and make the tax a part of the purchase price.

Thus, the price including the tax constitutes a debt from the purchaser or consumer

to the dealer until it is paid.

From the face of the petition, it appears that Szabo has collected the tax from the purchaser or consumer. In order for Szabo to have complied with the statute, the selling price of the food and drink would have had to have been adjusted so as to include the tax required by law to be passed on to the consumers or purchasers.

Apparently, Szabo bore no tax liability and the $72,270.84 represents the amount paid by the purchaser or consumer.

One who does not himself bear the financial burden of a wrongfully extracted tax suffers no loss or injury, and accordingly, would not have standing to demand a refund.

Id. at 532. Petitioner filed responses to Respondent's motions on December 30, 1988. In its responses, Petitioner argued that, because the Department of Revenue had already referred its petitions to the Division for hearing, Respondents should be estopped from now urging that the instant petitions be dismissed prior to such hearing being held. Petitioner further contended that, in any event, it does have standing to seek the return of the sales tax monies it remitted to the State of Florida.

On January 12, 1989, the undersigned issued an order rejecting the estoppel argument advanced by Petitioner and directing Petitioner to state in writing whether it had adjusted the price of items it sold to include the State sales tax. The undersigned indicated that if such adjustments had been made, Petitioner would be without standing to request refunds, as Respondents have claimed, in light of the Florida Supreme Court's holding in Szabo. Petitioner filed its response to this order on February 3, 1989. In its response, Petitioner states that, although it has not examined each and every one of its sales receipts, it "will assume here that the sales prices were `adjusted'" to reflect the State sales tax. It asserts, however, that it is nonetheless entitled to the refunds it has requested because the State of Florida is prohibited by federal law from imposing a sales tax on Petitioner's on- reservation business activity and therefore has no legal right to the sales tax monies paid by Petitioner's customers which are the subject of Petitioner's refund requests. Petitioner, in its response, also reiterates its previously made contention that the dismissal of the instant petitions at this prehearing stage of the proceedings should be barred by the doctrine of equitable estoppel.

In view of Petitioner's response, the undersigned has reexamined the Florida Supreme Court's opinion in Szabo. This further examination has reconfirmed the undersigned's belief that the court held in that case that a business enterprise, which includes the State sales tax in the price it charges its customers, does not have standing to request a refund of the sales tax monies it has collected and remitted to the State, regardless of whether these monies had been "wrongfully extracted." Inasmuch as Petitioner is such a business enterprise which has so adjusted its prices, it lacks standing under the holding in Szabo to obtain the refunds sought by the instant petitions.

Furthermore, the undersigned remains unpersuaded that, because the Respondent Department of Revenue initially determined to refer the instant

petitions to the Division for hearing, it cannot now seek the prehearing dismissal of the instant petitions. The doctrine of equitable estoppel may be applied against a governmental entity only in those rare instances where there has been (1) a representation as to a material fact that is contrary to a later- asserted position; (2) reliance on that representation; and (3) a change in position detrimental to the party claiming estoppel, caused by the representation and reliance thereon. Department of Environmental Regulation v.

C. P. Developers, 512 So.2d 258, 262-63 (Fla. 1st DCA 1987) . All of these circumstances are not present in the instant case and therefore the doctrine of equitable estoppel is inapplicable.

In view of the foregoing, it is

RECOMMENDED that a final order be issued dismissing the instant petitions because Petitioner is without standing to seek the sales tax refunds which are subject of the petitions.

DONE and ENTERED this 16th day of February, 1989, in Tallahassee, Leon County, Florida.

STUART M. LERNER

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 16th day of February, 1989.

COPIES FURNISHED:

S. Bobo Dean, Esquire Carol L. Barbero, Esquire HOBBS, STRAUS, DEAN & WILER 1819 H Street

Suite 800

Washington, D.C. 20006

William D. Townsend, Esquire Department of Revenue

102 Carlton Building Tallahassee, Florida 32399-0100

Joseph C. Nellichamp, III, Esquire Assistant Attorney General

The Capitol - Tax Section Tallahassee, Florida 32399-1050

Katie D. Tucker Executive Director Department of Revenue

102 Carlton Building Tallahassee, FL 32399

Docket for Case No: 88-006064

Orders for Case No: 88-006064