Can a used motor vehicle dealer purchase a new motor vehicle under the “resale” exception?
Under Ohio tax laws, any person making retail sales may acquire items (including motor vehicles) excepted from sales or use tax based on the “resale” exception. The problem is obtaining an Ohio title, as motor vehicle law does not allow a used motor vehicle dealer to acquire a new motor vehicle for purposes of resale. If a used motor-vehicle dealer purchases a new motor vehicle, pays Ohio sales and use tax when the Ohio title is obtained, and subsequently sells the vehicle with few, if any, miles added to the odometer, we would entertain an application for refund of the taxes paid by the dealer. If the used motor-vehicle dealer obtained the new motor vehicle by trading in a used vehicle, the taxes paid by that used motor vehicle dealer would be based on the price of the new vehicle, reduced by the used vehicle trade-in allowance.
