County Bulletin
TO: ALL COUNTY AUDITORS Bulletin No. 267
FROM: Joanne Limbach, Tax Commissioner April 8, 1987
RE: Personal Property Taxation of Goods Stored in Federal
Customs-Bonded Warehouses
A recent decision of the United States Supreme Court has
changed the applicability of the Ohio Personal Property Tax
to certain goods stored in federal customs-bonded
warehouses*.
In R. J. Reynolds
Tobacco Company v. Durham County, North Carolina,
et al.,.479 US ____, 93 L Ed 2d 449, 107 S Ct 499
(December 9, 1986), the United States Supreme Court held that
personal property imported from a foreign source,
destined for
domestic use and stored in federal customs-bonded warehouses
is subject to a state's nondiscriminatory property tax.
Prior to this R. J. Reynolds decision
foreign imports stored in customs-bonded warehouses were
considered immune from state and local property taxes
based upon were stored pending foreign destination.
This R. J.
Reynolds decision has now an earlier decision of
the U. S. Supreme Court ** wherein the foreign source
goods clarified that such immunity does not apply to
foreign goods stored in federal customs bonded warehouses
and destined for domestic use, sale
or consumption. The immunity from the Ohio Personal
Property Tax continues to apply to foreign source
property so stored and held for foreign shipment.
As a result of the R. J. Reynolds decision,
all property imported from a source outside of the United
States, stored in Ohio in federal customs-bonded warehouses
and to be used in the United States, is subject to the Ohio
Personal Property Tax provided:
1.) The property has a situs in a taxing district in
Ohio, and
2.) The property is used in business as provided by
Section 5701.08 of the Ohio Revised Code, and
3.) The property is no longer in transit in interstate
or foreign commerce.
All Personal Property Tax Returns for the years 1987 and
thereafter shall be prepared and filed in accord with these
principles.
*Customs-bonded warehouses are provided for and established
by Federal Law, Title 19 United States Code, Sections 1555
through 1565.
**Xerox
Corporation v. County of Harris, 459
US 145, 74 L Ed 2d 323, 103 S Ct. 523. (December 13, 1982)