Indiana Tax Court Holds Cell Phones Qualify for Telecommunications Equipment Exemption

The Indiana Tax Court granted partial summary judgment to the taxpayer on the question of whether cell phones qualify for Indiana’s telecommunications equipment sales and use tax exemption, but denied summary judgment on the refund claim. The taxpayer, a wireless telecommunications company, purchased cell phones and used some to fulfill contractual obligations by providing them free to customers entering service contracts and as replacements under insurance policies, then paid use tax and sought refunds claiming the phones were exempt under Indiana Code § 6-2.5-5-13. The Department argued that the exemption for “radio or microwave transmitting or receiving equipment” was limited ...