C & C Machinery, Inc. v. Ragland

Steele Hays, Justice.

Appellant operates a machine shop, transforming unprocessed metal materials into finished products. In June, 1976 appellant bought twelve pieces of equipment in Oklahoma for use in its shop in Arkansas and was assessed a use tax of three percent of the purchase price under the Arkansas Compensating Tax Act of 1949, Ark. Stat. Ann. § 84-3101 (Repl. 1980), et seq., amounting to $696.68 in tax, penalty and interest.

Appellant paid the assessment under protest, claiming the purchase was exempt under § 84-3106 (D) (2), which exempts machinery and equipment “used directly in…