ÿWPCô. …# VUNa %¯ 0 Nµ 0 Í bÐ w@Ø 4 , z; †µ 0D;  m 0J˜ 0Tâ 0^6 0h” 0rü 0|n 0†ê 0p 1u 0du BÙ D3ö 0@)U">iB)§DCÐ AMU*`2Š—¼,S§Ù&ªÿ©|6L²!v~þ%vÓ|' AOO-Æž- 0Dd. D/¨. B×.˜HP LaserJet 4Si/4SiMX PS 600dpiPSCRIPTÀÌÀääÀÀÌ0 'í€"  Z 6Times New Roman Regular¼(&öy$¡¡Ó  ÓÙñÓ Ù(}(2t"$¤¤Ý ƒöy!ÝÓ  ÓÙñÓ ÙÝ  ÝÒ°ÒÒ„°ÒÔ€Xu_X¼¼Ôà ` àòòÚ  Ú0Ú  Úóó- ù- ¥U¦b§D¨©ªD«D¬­Ó€·DÒ -3|x·AABAKASHUDDLESTONSontagBurson SimsScallyAabakus v. Huddleston - Opinion Ì . ' IB011C20IB011C2 .   (#Ã$òòÚ  Ú0Ú  Úóó ÿU‹ÿÀÀÀ2 ÿÿ0Indent1Ô2ÔÔ3  Ô2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô !" ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ d(((('ÿÿdxd("ÿÿ$££Ò  ÒÒ  Ò< Œ 9p`(&Times New Roman% Line 7 d////7Border 1dd€-0Cþÿ << Gÿÿ< Œ 9p`(Arial (Ý ƒ!ÝÑ  ÑÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÔ€2ÔÔ€2ÔÓ  Óò òÔ YYY ÔFILEDÔ€2XÔÌÌSeptember€25,€1996ÌÌCecil€W.€CrowsonÌAppellate€Court€ClerkÔ  Ôó ó Ý ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›These€services€include:€(1)€payroll€processing€and€administration,€(2)€payment€ofÏemployment„related€taxes,€(3)€filing€annual€reports,€(4)€coordinating€COBRA€compliance€andÏgroup€medical€insurance€coverage,€(5)€coordinating€workerððs€compensation€coverage,€(6)Ïdeveloping€and€coordinating€an€employee€policy€manual,€and€(7)€providing€guidance€andÏassistance€with€respect€to€administrative€hearings,€appeals,€and€labor€disputes.Ì "Ý ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›Tenn.€Code€Ann.€œðððð€67„4„701›€œto€„729›€(1994€&€Supp.€1996).Ì Ý ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›A€businessððs€ð ðdominant€business€activityðð€is€that€ð ðbusiness€activity€which€is€the€majorÏand€œprincipal›€source€of€gross€sales.ðð€€Tenn.€Code€Ann.€ðð€œ67„4„702(a)(4)€(1994).›Ì ÏÝ ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›The€SIC€of€1972€was€amended€by€a€separately€bound€supplement€issued€in€1977.€€ItÏhas€since€been€superseded€by€a€completely€revised€edition€published€as€the€SIC€of€œ1987.€€AllÏreferences€in€this€opinion€are€to€the€most€current€SIC€of€1987.›Ì  Ý ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›The€SIC€also€contains€many€ð ðmiscellaneousðð€code€numbers€for€services€that€cannot€beÏreadily€classified€under€one€of€the€existing€industry€œcodes.€€òòSIC€of€1987óó,€òòsupraóó,€at€12.›Ì ƒÝ ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›For€example,€¢Aabakus£€added€underwriting€to€its€Blue€Cross/Blue€Shield€medical€planÏto€deny€insurance€coverage€to€new€employees€who€have€serious€medical€problems.Ì rÝ ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›For€the€purpose€of€taxation,€exclusions€are€items€that€were€never€in€the€taxing€statuteÏin€the€first€place,€while€exemptions€are€items€that€would€otherwise€be€subject€to€taxation€butÏwhich€have€been€removed€by€statute.€€òòIn€re€¢Twisteroo£€Soft€Pretzel€Bakeries,€Inc.,óó€21€¢B.R.£Ï665,€667€(E.D.€Pa.€1982);€òòLancaster€œLabs.,›€Inc.€v.€Commonwealth,óó€631€A.2d€739,€741€n.1Ï(Pa.€¢Commw£.€Ct.€1993).Ì BÝ ƒ!ÝÑ#€d#ÑÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÝ ƒ$ÝÒ  ÒÒ „ ÒÔ€.XÔà àòòÚ  ÚÚ  ÚóóÝ  Ý›¢Aabakus£ððs€representations€to€the€Department€of€Employment€Security€that€its€clientsððÏemployees€are€its€employees€does€not€necessarily€transform€them€into€¢Aabakus£ððs€employees.€ÏThe€test€traditionally€used€to€determine€the€existence€of€an€employment€relationship€includesÏconsidering€(1)€the€right€to€control€the€conduct€of€the€work,€(2)€the€power€of€termination,€(3)Ïthe€method€of€payment,€(4)€the€freedom€to€select€and€hire€other€workers,€(5)€the€furnishing€ofÏtools€and€equipment,€and€(6)€the€scheduling€of€the€work.€€òò¢Galloway£€v.€Memphis€Drum€Serv.,óóÏ822€¢S.W.2d£€584,€586€(Tenn.€1991);€òò¢Stratton£€v.€United€œ¢Inter„Mountain£›€Tel.€Co.,óó€695€¢S.W.2d£Ï947,€950€(Tenn.€1985).€€When€the€limited€facts€in€this€record€are€examined€in€light€of€theseÏfactors,€it€appears€that€¢Aabakus£ððs€clients€remain€the€employers„in„fact€of€their€employees.ÌPtPtHHÚ(ÿáÿâùFG(üHHÚ(d'@Styl{WP}01•ÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃà Ãà Ãà Ãà Ãà ÃÃÃÃÃÃÃÃÃÃÃÐ ÐÐHHÐÐ  ÐÐ2ÐÐÿÿ¸æ$ÿÐÐHHÐÐÐÐÐÐÐÐ  ÐÐ ÐÐ ÐÑÑÑGenevaÑÑ ÑÑ € ÑÑ<Px–ÈÑÒÒÒ443!#4ÒÒ$ *$ÒÒ$*$ÒÒ ÿKK ÒÒ  Geneva ÒÒ  Geneva ÒÓ.,ÓÓÓÓ6ÓÓ ÓßßßßßßßßßßßßßßßßßßÑGenevaÑÑ ÑÒ  BA Op Geneva ÒÒ  BA Op Geneva Ò€-‚ƒCþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5($$””ò òÚ  Ú1Ú  Úó ó„„'÷ÿ dxdüÿP PdÝ ƒ!ÝÔ . ÔÔ€.ÔÔ€.¼ÔÓ  ÓÝ  ÝÒ  ÒÒ „ ÒÑ Ü ÑÑ\R AØ'\ÑÑ  ÑÑ€ÑÑ7€ŸK¼¼ddÈ7ÑÑ  ÑÑ  Ñ›à@ àÔ€.„Ôò òIN€THE€COURT€OF€APPEALS€OF€TENNESSEEÌÙ€€ÙœßL€130;+'h|æ4` ç `€€Lß›à@ àMIDDLE€SECTION€ATÏNASHVILLEÌÌÔ€.¼ÔÌÌÌó ó¢AABAKUS£,€INCORPORATED,à à)Ìà àà àà àà àà àà à)Ìà àPlaintiff/Appellant,à àà à)Ìà àà àà àà àà àà à)à àDavidson€ChanceryÌà àà àà àà àà àà à)à àNo.€93„2739„IIÌVS.à àà àà àà àà àà à)Ìà àà àà àà àà àà à)à àAppeal€No.Ìà àà àà àà àà àà à)à à01„A„01„9505„CH„00215ÌJOE€B.€HUDDLESTON,à àà0 àœ)›ÌCommissioner€of€Revenue,€à àà à)ÌState€of€Tennessee,à àà à€€à à)Ìà àà àà àà àà àà à)Ìà àDefendant/Appellee.à àà à)ÌÌÌà@ àAPPEAL€FROM€THE€CHANCERY€COURT€FOR€DAVIDSON€COUNTYÌà@ àAT€NASHVILLE,€TENNESSEEÌÌà@ àTHE€HONORABLE€C.€ALLEN€HIGH,€CHANCELLORÌÌÌòòFor€the€Plaintiff/Appellantóó:à àà àà àà àòòFor€the€Defendant/Appelleeóó:ÌÌMichael€D.€Sontagà àà àà àà àà àCharles€W.€BursonÌBass,€Berry€&€Simsà àà àà àà àà àAttorney€General€andÏReporterÌNashville,€TennesseeÌà àà àà àà àà àà àà àà àSean€P.€ScallyÌà àà àà àà àà àà àà àà àAssistant€Attorney€GeneralÌÌÌÌÌÌÌà@ àÔ€.„Ôò òAFFIRMED€IN€PART;€à@ àREVERSED€IN€PART;Ìà@ àAND€REMANDEDó óÌÌÔ€.¼ÔÌÌÌÌà àà àà àà àà àà àà àWILLIAM€C.€KOCH,€JR.,ÏJUDGEÇÑ ° ÑÑ „ ÑÓ€ÓÔ€.„Ԝ̛à@ àò òòòO€P€I€N€I€O€Nóóó óÌÔ€.¼ÔÌà àThis€appeal€involves€the€business€tax€liability€of€œa›€human€resourceÏsupport€service.€€The€Tennessee€Department€of€Revenue€treated€all€amountsÏpaid€by€the€serviceððs€clients€as€gross€receipts€and€assessed€the€service€$40,867Ïfor€unpaid€taxes,€penalties,€and€interest.€€The€service€paid€the€disputed€amountÏand€then€filed€suit€in€the€Chancery€Court€for€Davidson€County€asserting€that€itÏwas€exempt€from€taxation€on€the€ground€that€it€was€merely€providingÏbookkeeping€services€or,€in€the€œalternative,›€that€its€gross€receipts€consistedÏonly€of€the€service€fees€collected€from€its€clients.€€The€trial€court€granted€œtheÏdepartmentððs›€motion€for€summary€judgment,€and€this€appeal€followed.€€WeÏhave€determined€that€the€service€was€not€exempt€from€taxation€but€that€itsÏgross€receipts€should€be€limited€to€the€service€fees€collected€from€its€clients.€ÏAccordingly,€we€modify€the€judgment.ÌÌÓ  Óò òI.ó óÌÓ  ÓÌà à¢Aabakus£,€Inc.€provides€human€resource€management€services× ƒ4 ××  ×€to€smallÏbusinesses.€€¢Aabakus£€and€its€clients€enter€into€ð ðclient€service€agreementsðð€inÏwhich€¢Aabakus£€agrees€to€perform€the€services€desired€by€the€client€in€returnÏfor€a€lump€sum€client€service€fee.€€¢Aabakus£€becomes€the€ð ðemployerðð€on€paperÏof€its€clientsðð€employees,€but€the€employees€continue€to€perform€the€sameÏwork€and€remain€under€the€clientððs€direct€supervision€and€control.€€During€theÍaudit€period,€¢Aabakus£€had€approximately€twenty€clients€employing€a€total€ofÏapproximately€200€employees.ÌÌà à¢Aabakus£ððs€clients€typically€compute€the€number€of€hours€worked€andÏthe€rate€of€pay€for€each€of€their€employees€as€payday€approaches.€€TheyÏprovide€this€information€to€¢Aabakus£€along€with€a€check€or€wire€transfer€toÏcover€the€gross€payroll,€all€applicable€taxes€and€insurance€premiums,€andÏ¢Aabakus£ððs€service€fee.€€After€receiving€these€funds,€¢Aabakus£€prepares€theÏpayroll€checks,€pays€the€taxes€and€insurance€premiums,€and€completes€andÏfiles€the€necessary€reports€for€each€client.€€The€funds€remaining€after€all€theÏchecks€are€distributed€and€other€related€payments€are€made€representsÏ¢Aabakus£ððs€service€fee.ÌÌà àThe€Business€Tax€Division€of€the€Department€of€Revenue€auditedÏ¢Aabakus£€for€the€period€from€July€1,€1988€through€December€31,€1990.€€TheÏdivision€took€the€position€that€all€funds€¢Aabakus£€received€from€its€clientsÏshould€be€considered€gross€receipts,€and€accordingly€on€December€18,€1992,Ïthe€Commissioner€of€Revenue€issued€¢Aabakus£€an€assessment€for€$40,867€inÏunpaid€taxes,€penalties,€and€interest.€€¢Aabakus£€paid€the€assessment€plusÏadditional€accrued€interest€on€June€15,€1993€and€simultaneously€filed€a€claimÏfor€a€refund€of€$42,081.42€on€the€grounds€that€its€business€was€totally€exemptÏfrom€taxation€under€Tenn.€Code€Ann.€ðð€œ67„4„708(3)(C)(viii)›€(1994).€€TheÏcommissioner€denied€the€refund€claim€on€July€9,€1993,€and€¢Aabakus£€then€filedÏa€timely€petition€for€judicial€review€in€the€Chancery€Court€for€DavidsonÏCounty.€€The€trial€court€granted€the€commissionerððs€motion€for€summaryÏjudgment,€and€this€appeal€ensued.ÌÌà@ àò òII.ó óÌÌà à¢Aabakus£€first€asserts€that€it€is€exempt€from€paying€business€taxesÏbecause€it€is€providing€nothing€more€than€ð ðaccounting,€auditing,€andÏbookkeeping€servicesðð€which€are€exempt€from€taxation€under€Tenn.€CodeÏAnn.€ðð€67„4„708(3)(C)(viii).€€We€do€not€agree€because€the€undisputedÏevidence€demonstrates€that€¢Aabakus£ððs€dominant€business€activity€is€much€moreÏthan€mere€accounting,€auditing,€and€bookkeeping€services.ÌÌà@ àò òA.ó óÌÓ  ÓÌÓ  Óà àThe€standards€for€construing€tax€statutes€are€well€understood.€€TheÏwords€in€the€statute€should€be€used€in€their€natural€and€ordinary€sense.€ÏòòNashville€Golf€&€Athletic€Club€v.€¢Huddleston£óó,€837€¢S.W.2d£€49,€53€(Tenn.Ï1992).€€They€should€not€be€construed€so€as€to€extend€or€to€limit€the€statute'sÏœmeaning€beyond€the€import€of€the€language€used.›€€òòMetropolitan€¢Gov't£€v.ÏMotel€œSys.,›€Inc.óó,€525€¢S.W.2d£€840,€841€(Tenn.€1975).€€Thus,€a€clear€expressionÏof€legislative€intent€will€generally€be€given€effect€as€written.€€òò¢Stratton£€v.ÏJacksonóó,€707€¢S.W.2d£€865,€866€(Tenn.€1986).€€ÌÌà àLaws€imposing€a€tax€are€strictly€construed€against€the€taxing€authority.€ÏòòNational€Gas€¢Distribs£.,€Inc.€v.€Stateóó,€804€¢S.W.2d£€66,€67€(Tenn.€1991).€€Thus,Ïtax€laws€will€not€be€extended€by€implication€beyond€the€clear€import€of€theirÏlanguage€nor€will€their€operation€be€enlarged€to€embrace€matters€notÏspecifically€included.€€òòCovington€Pike€Toyota,€Inc.€v.€¢Cardwell£óó,€829€¢S.W.2d£Ï132,€135€(Tenn.€1992).€€Conversely,€exemptions€are€construed€against€theÏtaxpayer.€€òò¢AFG£€Indus.,€œInc.€v.›€¢Cardwell£,óó€835€¢S.W.2d£€583,€584„85€(Tenn.Ï1992).€€Taxpayers€bear€the€burden€of€proving€that€they€are€entitled€œto€an›Ïexemption,€òò¢Tibbals£€Flooring€Co.€v.€¢Huddleston£,óó€891€¢S.W.2d£€196,€œ198›€(Tenn.Í1994),€and€a€well„founded€doubt€will€be€fatal€to€a€claim€for€an€exemption.€ÏòòUnited€Canners,€Inc.€v.€Kingóó,€696€¢S.W.2d£€525,€527€(Tenn.€1985).€ÌÌà àThe€construction€of€a€tax€statute€is€a€question€of€law€for€the€courts.€Ïòò¢Beare£€Co.€v.€Tennessee€¢Depððt£€of€Revenue,óó€858€¢S.W.2d£€œ906,›€907€(Tenn.€1993).€ÏWhile€a€taxing€agencyððs€interpretation€of€a€tax€statute€is€persuasive,€it€isÏcertainly€not€conclusive.€€òòMoto„Pep,€Inc.€v.€¢McGoldrick£óó,€202€Tenn.€119,€129,Ï303€¢S.W.2d£€326,€330€œ(1957).€›€Thus,€when€the€facts€are€undisputed,€theÏquestion€of€whether€a€taxpayer€is€entitled€to€an€exemption€is€purely€a€questionÏof€law€for€the€courts.€€òòSeeóó€òòOak€Ridge€Hosp.€of€the€Methodist€Church,€Inc.€v.ÏCity€of€Oak€Ridgeóó,€57€Tenn.€App.€487,€490,€420€¢S.W.2d£€583,€584€(1967).€€ÌÌÓ  Óò òB.ó óÌÓ  ÓÌà àThe€Business€Tax€Actœ× ƒ5 ××  ×›€is€a€component€of€Tennesseeððs€scheme€ofÏprivilege€and€excise€taxes.€€It€allows€counties€and€incorporated€municipalitiesÏto€tax€the€privilege€of€ð ðthe€making€of€sales€by€engaging€in€any€.€.€.€businessÏactivity€enumerated€.€.€.€in€œðð›€67„4„708(1)„(3).ðð€€Tenn.€Code€Ann.€ðð€œ67„4„704(a)€(1994).›€€Businesses€are€classified€in€Tenn.€Code€Ann.€ðð€67„4„708Ïaccording€to€their€ð ðdominant€business€activity,ððœ× ƒ6 ××  ×›€and€these€statutoryÏclassifications€determine€the€rate€and€due€date€of€the€tax.€ÌÌà àTenn.€Code€Ann.€ðð€67„4„708(3)(C)€declares€generally€that€ð ðmakingÏsales€of€services€or€engaging€in€the€business€of€furnishing€or€renderingÏservicesðð€is€a€taxable€privilege.€€The€statute€then€lists€fifteen€service€categoriesÍthat€are€exempt€from€taxation.€€Tenn.€Code€Ann.€ðð€67„4„708(3)(C)(¢i£)„(xv).€ÏTo€further€describe€the€services€exempt€from€taxation,€Tenn.€Code€Ann.€ðð€67„4„708(3)(C)€states€that€ð ð[¢i]t£€is€the€legislative€intent€that€the€exceptions€.€.€.€shallÏinclude€the€sales€of€services€by€those€businesses€or€establishments€so€describedÏin€the€Standard€Industrial€Classification€Index€of€œ1972,€including€allÏsupplements€and€amendments›€.€.€œ.€.ð𛀀€œ›Ìà àTenn.€Code€Ann.€ðð€67„4„708(3)(C)(viii)€exempts€œð ð[a]ccounting,›Ïauditing,€and€bookkeeping€servicesðð€from€taxation.€€¢Aabakus£€argues€that€it€isÏentitled€to€a€total€exemption€from€taxation€under€this€section.€€In€order€toÏevaluate€¢Aabakus£'s€claim,€we€œlook›€to€the€Standard€Industrial€œClassification›ÏManual€to€determine€the€meaning€of€accounting,€auditing,€and€bookkeepingÏservices€under€that€classification€system.€€We€must€then€determine€whetherÏthere€is€any€genuine€dispute€of€material€fact€as€to€whether€¢Aabakus£€fits€underÏthis€category.€€ÌÌÓ  Óò òC.ó óÌÓ  ÓÌà àThe€Standard€Industrial€Classification€Manual€(SIC)€classifies€businessÏestablishments€by€the€type€of€economic€activity€they€perform.€€œOffice€ofÏManagement€&€Budget,€Executive€Office€of€the€President,€òòStandard€IndustrialÏClassification€Manual€of€1987óó,€at€11,€699€(1987)€[hereinafter€òòSIC€of€1987óó].€ÏThe€manual›€was€œdesigned›€specifically€for€statistical€œpurposes,€òòSIC€of€1987óó,Ïòòsupraóó,€at€699,€and›€thus€classifies€only€those€types€of€business€establishmentsÏrepresenting€a€significant€part€of€the€economy.€œ€òòSee€SIC€of€1987óó,€òòsupraóó,€at€11,Ï701.€€It€has›€been€amended€and€revised€several€times€since€1972€in€order€toÍreflect€the€œeconomy's€changing›€œindustrial€organization.× ƒ7 ××  ×€€òòSIC€of€1987óó,€òòsupraóó,Ïat€3.›ÌÌà àThe€SIC€classifications€are€based€on€the€ð ðprimaryðð€or€ð ðpredominantððÏactivity€of€the€subject€industries.€€œòòSIC€of€1987óó,€òòsupraóó,€at€15.€€The›€activity€inÏwhich€a€particular€service€industry€is€primarily€engaged€is€determined€by€theÏvalue€of€the€receipts€or€revenues€generated€by€the€various€activities€of€theÏbusiness.€€œòòSIC€of€1987óó,€òòsupraóó,€at€16.€€The›€activity€generating€the€greatestÏrelative€share€of€ð ðvalue€addedðð€is€the€businessððs€primary€œactivity.€€òòSIC€ofÏ1987óó,€òòsupraóó,€at€15.€€By›€classifying€on€this€basis,€a€business€which€generatesÏrevenue€from€some€incidental€activity€is€not€classified€based€upon€that€activity.€€ÌÌà àThe€SIC€is€first€divided€into€major€divisions€representing€the€variousÏsectors€of€our€economy€such€as€agriculture,€manufacturing,€or€services.€€EachÏdivision€is€then€broken€down€into€major€groups,€industry€groups,€and€finallyÏspecific€industries€by€number.€€œòòSIC€of€1987óó,€òòsupraóó,€at€12.€€For›€example,Ïð ðAccounting,€Auditing,€and€Bookkeeping€Servicesðð€is€industry€number€8721Ïwhich€is€part€of€industry€group€number€872€by€the€same€name.€€IndustryÏgroup€872€lies€in€major€group€87,€ð ðEngineering,€Accounting,€Research,ÏManagement,€and€Related€Services,ðð€under€the€division€of€services.€€œòòSIC€ofÏ1987óó,€òòsupraóó,€at€401„02.× ƒ8 ××  ×›ÌÌà àThe€manual€does€not€provide€additional€information€concerning€theÏtypes€of€services€intended€to€be€included€in€industry€number€8721.€€€However,Íit€identifies€ð ðpayroll€accounting€serviceðð€as€a€specific€example€of€such€aÏservice.€€By€the€same€token,€it€indicates€that€other€types€of€services€would€notÏbe€included€in€industry€number€8721€by€placing€them€in€a€different€industryÏcode€number.€€For€example,€ð ðemployee€leasing€servicesðð€are€included€inÏindustry€code€number€7363€(ð ðHelp€Supply€Servicesðð)€and€ð ðhuman€resourceÏconsultantsðð€œand€"personnel€management€consultants"€are›€listed€under€industryÏcode€number€8742€(ð ðManagement€Consulting€Servicesðð).ÌÌÓ  Óò òD.ó óÌÓ  ÓÌà à¢Aabakus£€describes€itself€as€a€ð ðrentable€human€resources€department.ðð€ÏSusan€G.€Mitchell,€the€companyððs€chief€executive€officer,€stated€that€¢Aabakus£ððsÏservices€include€everything€from€the€processing€of€payroll€to€the€coordinationÏof€group€benefits€to€the€preparation€of€an€employee€policy€manual€for€œitsÏclients.›€€Although€Ms.€Mitchell€calls€herself€a€ð ðpaperwork€junkie,ðð€it€is€clearÏthat€¢Aabakus£€performs€much€more€than€simple€accounting,€auditing,€andÏbookkeeping€œservices.Ì›Ìà àAs€a€ð ðrentable€human€resources€department,ðð€¢Aabakus£€provides€aÏcafeteria€benefit€plan€for€its€œclients.›€€While€it€processes€the€paperworkÏassociated€with€these€plans€and€collects€the€various€premiums€involved,€it€alsoÏmeets€with€its€clientsðð€employees€to€explain€their€benefits€and€is€alwaysÏaccessible€to€answer€employeesðð€questions.€€Any€employee€of€a€client€mayÏrequest€¢Aabakus£ððs€help€in€handling€a€benefit€problem,€such€as€unpaid€medicalÏbenefit€claims.€€¢Aabakus£€also€acts€as€an€administrator€of€the€cafeteria€benefitÍplan€by€monitoring€costs€and€by€determining€when€and€how€to€change€theÏbenefits€offered€to€œthe€employees›€of€œits€clients.¢›× ƒ9 ××  ×£ÌÌà àBesides€the€administration€of€the€benefit€plans,€¢Aabakus£€also€guides€itsÏœclients›€œthrough›€workerððs€compensation€investigations.€€It€helps€œthem€to›€file€theÏnecessary€ð ðfirst€¢report[s£]€of€injuryðð€with€the€workerððs€compensation€carrier.€Ï¢Aabakus£€also€provides€its€œclients›€with€a€list€of€physicians€with€whom€it€hasÏnegotiated€discounts€for€treatment€of€injured€workers.€€Finally,€¢Aabakus£Ïassists€œits€clients›€in€œinvestigating›€questionable€œclaims,›€thereby€preserving€aÏrecord€to€be€consulted€should€the€need€arise.€€Ìœ›Ìà à¢Aabakus£€also€attends€unemployment€hearings€and€labor€board€disputesÏwith€the€managers€of€œits€clients.›€€In€this€role,€it€guides€its€clientsðð€managersÏthrough€the€relevant€procedures,€and€it€also€returns€for€the€œhearing›€andÏprepares€the€required€paperwork.€Ms.€Mitchell€stated€that€ð ð[a]€lot€of€times,Ï[the€œclient€companies]›€just€want€comfortðð€at€these€hearings.€€€€ÌÌà àIn€addition,€¢Aabakus£€maintains€the€employee€records€and€preparesÏemployee€policy€manuals€for€œits›€œclients.›€€It€also€provides€life,€cancer,€andÏdisability€insurance€coverage€at€large€group€rates,€and€it€makes€available€aÏ401(k)€retirement€plan,€credit€union€memberships,€and€Samððs€Wholesale€ClubÏmemberships€to€all€its€clientsðð€employees.€ÌÌà àMs.€Mitchell€does€not€dispute€that€¢Aabakus£€provides€these€services.€€InÏfact,€all€of€the€information€about€the€companyððs€activities€was€included€in€herÏdeposition.€She€simply€asserts€that€¢Aabakus£ððs€primary€function€is€to€performÍaccounting,€auditing,€and€bookkeeping€services€for€its€œclients.›€€In€this€regard,ÏMs.€Mitchell€notes€that€¢Aabakus£€prepares€the€payrolls€and€distributes€all€of€theÏnecessary€third„party€payments€such€as€federal€withholding,€social€securityÏtaxes,€and€any€state€taxes.€€¢Aabakus£€also€prepares€the€required€quarterly€andÏannual€reports.€€ÌÌÓ  Óò òE.ó óÌÓ  ÓÌà àSince€the€facts€of€this€case€are€undisputed,€the€question€of€whetherÏ¢Aabakus£€is€entitled€to€œa›€Tenn.€Code€Ann.€ðð€67„4„708(3)(C)(viii)€exemptionÏfrom€business€taxes€is€purely€a€question€of€law.€€òòOak€Ridge€Hosp.€of€theÏMethodist€Church,€Inc.€v.€City€of€Oak€Ridge,óó€57€Tenn.€App.€at€490,€420Ï¢S.W.2d£€at€584.€€Thus,€the€issue€is€appropriate€for€disposition€under€summaryÏjudgment€standards.€€ÌÌà àWe€have€concluded€that€¢Aabakus£€is€not€entitled€to€take€advantage€of€theÏexemption€from€business€taxes€under€Tenn.€Code€Ann.€ðð€67„4„708(3)(C)(viii).€ÏThe€service€fee€paid€by€each€client€œis›€based€upon€all€of€the€services€performedÏor€available€to€be€performed€by€¢Aabakus£.€€Thus,€the€accounting,€auditing,€andÏbookkeeping€services€cannot€be€separated€from€the€other€human€resourceÏfunctions€performed.€€These€are€not€separate€activities€generating€a€separateÏshare€of€the€ð ðvalue€addedðð€by€¢Aabakus£ððs€business€but€rather€are€part„and„parcel€of€the€entire€service€package€performed€by€¢Aabakus£.€€No€singleÏfunction€or€service€can€be€viewed€as€incidental€to€the€others.€€ÌÌà àThus,€¢Aabakus£ððs€services€are€a€combination€of€various€SIC€industryÏclassifications.€€Since€the€SIC€is€designed€to€function€as€a€statisticalÏclassification€system€for€distinct€industries,€we€have€concluded€that€¢Aabakus£Íwould€presently€be€classified,€if€at€all,€under€one€of€the€miscellaneous€industryÏcategories.€€Its€functions€are€far€broader€than€the€mere€ð ðpayroll€accountingÏservicesðð€classified€under€SIC€industry€number€8721.€€The€wealth€of€servicesÏit€provides€related€to€health€and€welfare€benefit€planning,€if€presentlyÏclassifiable,€appear€to€be€more€closely€akin€to€management€consulting€includedÏin€industry€code€number€8742.€€Accordingly,€as€a€matter€of€law,€¢Aabakus£€isÏnot€entitled€to€a€complete€exemption€from€business€taxes€under€Tenn.€CodeÏAnn.€ðð€œ67„4„708(3)(C)(viii).›€€Thus,€we€affirm€the€trial€courtððs€order€in€thisÏregard.€€ÌÌÓ  Óò òIII.ó óÌÓ  ÓÌà àOur€inquiry€is€not€yet€complete€even€though€we€have€determined€thatÏ¢Aabakus£€is€not€entitled€to€a€total€exemption€from€taxation€since€its€businessÏentails€more€than€simple€accounting,€auditing,€and€bookkeeping€services.€€WeÏmust€still€determine€what€portion€of€the€funds€¢Aabakus£€receives€from€itsÏclients€is€subject€to€taxation.€€¢Aabakus£€argues€that€only€its€service€fee€shouldÏbe€taxable.€€We€agree.€€ÌÓ  Óò òA.ó óÌÓ  ÓÌà àThe€business€tax€has€been€described€as€a€ð ðgross€receiptsðð€tax.€€òò¢Stalcup£€v.ÏCity€of€¢Gatlinburg£óó,€577€¢S.W.2d£€439,€440€(Tenn.€1978);€òòIBM€Credit€Corp.€v.ÏCounty€of€Hamiltonóó,€830€¢S.W.2d£€77,€78€(Tenn.€Ct.€App.€1992).€€Regardless€ofÏthe€seeming€breadth€of€this€description,€the€assessment€of€business€taxes€isÏlimited€to€the€amount€of€sales€made€by€a€business.€€òòSeeóó€Tenn.€Code€Ann.€ðð€œ67„4„709(b)(3)€(1994);›€Tenn.€Comp.€R.€&€¢Regs£.€r.€1320„4„5„.08(2)€œ(1984).›€ÏThus,€in€order€to€determine€the€amount€of€taxes€due,€it€is€necessary€to€firstÏdetermine€the€sales€price€of€the€services€sold.€€ÌÌà àTenn.€Code€Ann.€ðð€œ67„4„702(a)(13)›€defines€ð ðsales€priceðð€as€ð ðthe€totalÏamount€for€which€.€.€.€services€rendered€is€sold€.€.€.€without€any€deductionÏtherefrom€on€account€of€the€.€.€.€labor€or€service€cost€.€.€.€or€any€otherÏexpense€whatsoever.ðð€€òòSee€alsoóó€Tenn.€Comp.€R.€&€¢Regs£.€r.€1320„4„5„.08(1).€Ï¢Aabakus£€asserts€that€the€sales€price€of€its€services€is€the€fee€charged€to€itsÏclients.€€The€commissioner,€on€the€other€hand,€maintains€that€¢Aabakus£ððs€taxÏliability€should€be€based€on€the€entire€dollar€amount€transferred€to€¢Aabakus£€byÏits€œclients›€each€time€payroll€is€due.€€Under€the€commissioner's€theory,Ï¢Aabakus£ððs€absolute€contractual€obligation€to€pay€over€most€of€the€fundsÏreceived€from€its€clients€to€third„parties€is€irrelevant.€€€ÌÌà àDetermining€the€meaning€of€ð ðsales€priceðð€for€purposes€of€the€businessÏtax€act€is€a€question€of€legislative€intent.€€We€are€mindful€that€the€GeneralÏAssembly€has€the€sole€prerogative€to€create€tax€exemptions€and€that€we€cannotÏcreate€them€by€judicial€fiat.€€However,€we€must€construe€tax€statutes€as€theyÏare€written.€€If€the€term€ð ðsales€priceðð€in€Tenn.€Code€Ann.€ðð€œ67„4„702(a)(13)›Ïincludes€only€¢Aabakus£ððs€fee,€then€the€additional€funds€¢Aabakus£€receives€fromÏits€clients€would€not€have€been€taxable€in€the€first€place.€€Rather€than€beingÏexempted€from€taxation,€these€funds€more€properly€should€be€considered€asÏbeing€excluded€from€taxation.¢œ× ƒ: ××  ×›£ÌÌÓ  Óò òB.ó óÌÓ  ÓÌà à¢Aabakus£€provides€personnel€management€services€to€small€businesses.€ÏIt€does€not€provide€simple€bookkeeping€services,€nor€does€it€supply€its€clientsÏwith€permanent€or€temporary€employees.¢œ× ƒ; ××  ×›£€€Its€client€service€agreementsÏidentify€the€services€to€be€provided€and€the€fee€œto€be€paid€for›€these€particularÏservices.€€This€fee€does€not€include€the€funds€that€¢Aabakus£€must€pay€over€toÏœthird„parties›€on€its€clientsðð€behalf.€€œ¢Ms.€Mitchell€estimated€that€Aabakus's€totalÏreceipts€from€its€clients€in€1993€was€£approximately›€œeight›€million€œdollars€andÏthat€only›€five€hundred€thousand€dollars€œremained›€after€all€required€third„partyÏpayments€œwere›€made.€€œThe€funds€remaining€represented›€the€fee€¢Aabakus£Ïearned€for€the€services€rendered€to€its€clients.€€ÌÌà àConsidering€the€statutory€definition€of€ð ðsales€priceðð€in€Tenn.€Code€Ann.Ïðð€œ67„4„702(a)(13),›€we€agree€with€¢Aabakus£€that€the€only€amount€taxable€is€thatÏamount€which€remains€after€the€œclientsðð›€third„party€payments€are€made.€€It€isÏthat€percentage€fee€which€represents€the€amount€for€which€¢Aabakus£ððs€ð ðservicesÏrendered€is€sold.ðð€€¢Aabakus£€merely€acts€as€a€paying€agent€for€œits›€œclients›€withÏrespect€to€the€rest€of€the€funds€received.€€Thus,€the€additional€funds€are€notÏtaxable€under€our€stateððs€business€tax€scheme.€€ÌÌÓ  Óò òIV.ó óÌÓ  ÓÌà àIn€summary,€we€find€that€¢Aabakus£€is€subject€to€taxation€under€theÏBusiness€Tax€Act€and€that€its€tax€liability€should€be€based€on€the€fees€it€chargesÏfor€its€personnel€management€services,€not€on€the€funds€it€receives€but€œisÏcontractually›€obligated€to€pay€over€to€third„parties.€Therefore,€we€remand€theÏcase€to€the€trial€court€for€the€determination€of€the€proper€amount€of€taxesÏowed€by€œ¢Aabakus£›€and€the€amount€of€any€refund€that€may€be€due€and€for€anyÏother€proceedings€that€may€be€required.€€We€also€tax€the€costs€of€this€appeal€toÏthe€Commissioner€of€Revenue.ÌÌÓÓà àà àà àà àà àà àà à____________________________Ìà àà àà àà àà àà àà àWILLIAM€C.€KOCH,€JR.,ÏJUDGEÌÌÌCONCUR:ÌÌÌ________________________________ÌHENRY€F.€TODD,€¢P.J.£,€M.S.€ÌÌÌ________________________________ÌSAMUEL€L.€LEWIS,€JUDGE€œ›