(specially concurring).
I specially concur.
I concur based upon my views expressed in Baskin-Robbins Ice Cream Company v. Revenue Division, Department of Taxation and Revenue, 93 N.M. 301, 599 P.2d 1098 (Ct.App.1979). In Baskin-Robbins, a franchise case, we held that a taxpayer was engaged in doing business in New Mexico and was not engaged in interstate commerce. The facts are not so dissimilar that a different result can be reached in AAMCO.
For the first time, we are confronted with Indiana Dept. of St. Rev. v. Convenient Ind. of Am., Inc., 157 Ind.App. 179, 299 N.E.2d 641 (1973). The court held that the minimal activities in Indiana of taxpayer, a Kentucky Corporation, with respect to service fees and advertising fees paid to taxpayer by Indiana franchisees fell short of the degree of activity contemplated by the Gross Income Tax Act. With reference to the “franchise fee,” the trial court found:
7. The franchise fee is income from the sale of an intangible. Plaintiff is a nonresident of the state of Indiana and such intangible does not have a situs in the state of Indiana, but rather has a situs in Louisville, Kentucky, the principal place from which the business of plaintiff was directed or managed.
The trial court concluded:
2. The Indiana gross income tax levied by the state of Indiana upon the receipts from the sale of the franchise was improper in that such receipts constituted receipts from an intangible asset having a situs in the state of Kentucky. [299 N.E.2d at 644.]
The State Department of Revenue did not appeal from the above finding and conclusion. Therefore, says Taxpayer:
AAMCO’s trademarks and service marks are intangible assets which have a situs in the State of Pennsylvania, and, as such, they cannot be taxed, nor can they be relied upon as property found within the State of New Mexico, for purposes of the New Mexico gross receipts tax.
Convenient was not subject to Indiana law because only one phrase in § 6-2-1-2, Ind.Code Ann. (Burns) was applicable:
and upon the receipt of gross income derived from activities or businesses or any other source within the state of Indiana, of all persons who are not residents of the state of Indiana
There is no resemblance between the Indiana and New Mexico statutes. AAMCO is engaged in business in New Mexico. Baskin-Robbins, supra. AAMCO did not challenge Finding No. 28. It reads in part:
By specifically providing that licenses, franchises, patents, trade marks [sic] and copyrights are property . it is apparent that the legislature intended to impose a tax on the receipts from leasing such property employed in New Mexico.
This finding, unchallenged, is conclusive.
AAMCO assumes it is in interstate commerce and argues that taxation is a burden on commerce. The only contacts AAMCO has with New Mexico are a franchise granted to a licensee, together with the right of the licensee to use its trade name and trademark “AAMCO Transmissions,” and AAMCO signs that are leased. No facts have been presented and none can be found that establishes any' intercourse or traffic between Pennsylvania. and New Mexico with reference to its franchise, trade name or trademark.
The only difference between AAMCO and Baskin-Robbins is that AAMCO conducts a six-week course in Pennsylvania for prospective franchisees. International Franchise Association, as Amicus Curiae, states:
The record reflects that Appellant furnishes services in the nature of training, operating manuals, consultation and continuing advice, advertising, research and development, and the maintenance and expansion of its franchise system and that such services are performed outside of New Mexico.
These facts establish that interstate commerce is absent.
Under the stringent statutory provisions of the Gross Receipts Tax Act, no franchise can escape payment of the tax. Relief can be obtained only in the legislature, not in the courts.