Tax News

CCH (cch.taxgroup.com) reports:

  United Stated Bureau of Customs and Border Protection officials who first denied, then revoked, a duty-free retailer's authority to sell duty-free gasoline were entitled to qualified immunity from the allegations made by the retailer. Under the Tariff Act, only merchandise that has been assessed federal tax or duty is ineligible for entry into a bonded warehouse and duty-free sale. The retailer, stating a
Bivens claim, alleged that the officials violated its constitutional rights under the Export Clause of the United Stated Constitution because they never determined whether any tax was actually assessed under Code Sec. 4081 on the retailer's fuel. The U.S. Court of Appeals for the Federal Circuit affirmed in 2005 that Customs should have first determined that a tax had been assessed on the retailer's gasoline before revoking the retailer's authority to sell it duty-free ( Ammex, Inc. v. U.S. , 2005-2 USTC ¶70,243).

  The officials were entitled to qualified immunity, however, because this was not the type of case where any reasonable official would know he or she was violating a clearly established right. The officials made their decision to revoke the retailer's authority to sell duty-free gasoline in reliance on a letter from the IRS. Further, the Federal Circuit found that their decision was reasonable because of the IRS's guidance. Finally, the officials revoked the retailer's authority in a procedurally transparent and open way, following Customs' published notice.

Ammex Inc., DC Mich., 2009-1 USTC ¶70,284

Other References:

 
Code Sec. 4081

  CCH Reference - ETR ¶8925.25

  Tax Research Consultant

  CCH Reference - TRC IRS: 18,450