Tyson Chicken, Inc.; Tyson Mexican Original, Inc.; and Tyson Poultry Inc. v. Jim Hudson, in His Official Capacity as Secretary of the Department of Finance and Administration of the State of Arkansas

Summary

The Arkansas Supreme Court affirmed summary judgment denying Tyson’s sales-tax refund claim for taxes paid on rented wooden shipping pallets. The court held that the pallets were used to deliver Tyson’s products but did not become a recognizable integral part of those products under Arkansas’s sales-for-resale exemption.

Holdings

1. The pallet rentals do not qualify for Arkansas's sales-for-resale exemption because the pallets do not become a recognizable integral part of the chicken or other food products Tyson sells.

Questions Presented

1. Whether Tyson's rentals of reusable wooden shipping pallets qualified for Arkansas's sales-for-resale exemption from sales tax.
2. Whether the pallets became a recognizable integral part of Tyson's manufactured or prepared food products under Ark. Code Ann. § 26-52-401(12)(B).

Disposition

affirmed