PROVIDENCE — Fresh from military service overseas, Army Sgt. William R. Buchanan marched into the offices of the Rhode Island Division of Taxation last week prepared to fight.

He wore a slightly baggy suit that he purchased on sale, and dress shoes he bought in Germany for 20 Euros. He parked his beloved car, the reason for his visit, in the parking lot off Park Street.

The pearl blue 2007 Volvo S-40 sedan with leather seats and a sunroof was a rare luxury. He bought it while stationed in Germany. A junior enlisted soldier at the time, earning about $21,000 a year, he wanted to take advantage of the international agreement that allows members of the U.S. military stationed overseas to shop tax-free.

But when he returned to Rhode Island last May and registered his Volvo, the state charged him a 7 percent “use tax” of $2,094.05.

Vet returns to fight another battle: Rhode Island sales tax

He had spent three years serving his country. What right did the state have, he asked, to essentially strip him of his military tax exemption?

Sergeant Buchanan is 26, with a boyish face and glasses. He grew up poor in South Providence, the only child of a disabled, single mother. At Hope High School, he played bass guitar, composed jazz music, and became an outspoken advocate for the school’s music program. He studied jazz composition at the Berklee College of Music, in Boston, commuting from his grandfather’s house in Warwick so he wouldn’t have to pay rent. To help repay his student loans after he graduated, he enlisted with the U.S. Army band.

Now, he is living in a $700-a-month apartment, collecting unemployment, studying for a master’s degree in urban education, and looking for a job.

“It’s kind of like the state saying you didn’t sacrifice enough already,” he said. “We need you to sacrifice more…”

He composed a letter to the state requesting a refund. That was denied. So, he petitioned for a hearing, sent e-mails pleading his case to more than a dozen state representatives, and hunkered down.

ON THE MORNING of the tax hearing, Buchanan strode through the heavy glass doors of the Department of Administration building on Smith Hill. He wore his hair cropped close, the way he had in the service, only now he sported a neatly trimmed goatee. His tattooed arms (one bore notes from a Charles Mingus song and the other, a quote by the German philosopher, Friedrich Nietzsche, “Without music, life would be a mistake”) were hidden under his business suit.

He carried his cell phone, on which he’d saved e-mails with tips from a lawyer friend, and a small, green notebook in which he’d jotted references to court cases he could use in his appeal. He had peppered his letter to the Division of Taxation with references to the “apportionment method” and “interstate commerce” and “article IV of the Constitution.”

Military service members who make purchases while stationed overseas are exempt from paying sales taxes under the Status Of Forces Agreement. By enforcing Rhode Island’s “sales-and-use” law, he argued, the state is effectively imposing a “backdoor sales tax” on service members.

“As a military member, I was entitled to certain privileges [such as tax free shopping],” he wrote, “which the State of R.I. has retroactively violated.”

If he didn’t get his way with the tax division, he thought, he’d take the state to court.

Inside the office building, he stopped at the security desk to sign in, and clipped a plastic visitor badge to his suit jacket. Then he followed the arrow on the wall to the tax division’s reception area, where an American flag poster taped to the glass read “God Bless America.”

BUCHANAN HAD BEEN training for about eight months in South Carolina and Virginia when, in 2007, he flew to the Wiesbaden Army Airfield base in Germany, to join the 1st Armored Division Band.

There, he bunked in single-sized room with another soldier. He slept on a narrow mattress wrapped in vinyl that absorbed so much heat that he’d wake each morning with his bed sheets soaked in sweat.

He and the other musicians in his unit had expected to be performing, but they spent most of their days running training exercises and packing equipment into giant metal storage containers for deployment.

One afternoon, Buchanan and two other soldiers rode a mile into town to the auto showrooms that cater exclusively to military personnel and diplomats. He’d been researching car options for weeks. He’d never owned his own car. The 20-year-old BMW that he drove back home had belonged to his grandfather, and it was in such bad shape that he donated it to charity.

In the Volvo showroom, he pored over catalogues and package options. The pearl blue Volvo caught his eye. The showroom was offering a sweet deal: the S-40 model sedan with six-speed manual transmission, all-wheel drive (perfect for those Rhode Island winters), a sunroof and a full audio system for $29,915 plus a $545 delivery charge.

Buchanan had $6,800 from his enlistment bonus and another $200 he had saved for the down payment. And with so few expenses, he could shovel $500 a month from his paycheck into the car loan and have the car paid off by the time he returned home.

The sales invoice listed the total cost of $30,460 with the words “tax exempt.”

He’d only driven his new car for one week before he was told that his unit was being deployed to a military base about 90 miles away. So he stored his car in the Army barracks at the base. Then, a few months later, he deployed to Iraq –– leaving his new Volvo behind in Germany.

Buchanan spent 14 months in Iraq, guarding the U.S. base and performing with the band for local dignitaries and civilians as Apache helicopters circled overhead. He returned to Germany for another six months, where he retrieved his car, before shipping it home to Rhode Island in May 2009.

THE DIVISION OF TAXATION’S reception window greets visitors with a red, delicatessen-style number dispenser, but when Buchanan arrived for his hearing, nobody was waiting. He gave his name to the receptionist, and was escorted down a hall to a small, windowless conference room with two men in dark suits.

The division’s principal revenue agent who had denied Buchanan’s claim explained that he would be representing the state in the matter; the other official, who sat across from Buchanan, would be the division’s hearing officer.

Buchanan was puzzled. This didn’t seem like the formal hearing he’d requested. Where was the judge or magistrate? Where was the stenographer? Why wasn’t the newspaper reporter he’d invited to the hearing allowed inside?

The hearing officer began to speak, but Buchanan interrupted. He’d requested a formal hearing. He wanted his testimony recorded.

Buchanan watched the hearing officer flip through a folder until he found Buchanan’s letter. He read it over. Buchanan had, in fact, requested a formal hearing. But this was only a preliminary hearing.

The tax officials were sympathetic, but their response was the same as when he’d filed his appeal. The sales-tax exemption he received was based on an agreement between the U.S. military and its host country, in this case, Germany. The agreement only exempted him from paying Germany’s sales taxes while he was stationed there. He was still responsible for paying the sales tax to Rhode Island (or any other state) where he registered the car.

Buchanan recalled a tax official who told him that he gets 10 to 12 calls a year from returning military personnel asking why they are being charged sales taxes on cars they bought while stationed overseas. But each state has its own sales-tax laws, and military personnel are not exempt from paying sales taxes in Rhode Island.

The revenue agent, whom Buchanan had previously spoken to at length about his case, suggested a Supreme Court case that might be helpful in his appeal. The officials shook his hand and escorted Buchanan out the door.

On his way past the security guard, he unclipped his plastic visitor badge and dropped it on the counter. He had already missed his morning class in Quantitative Statistics at Brown University, where he has a one-year fellowship to study urban education. So he drove to The Providence Journal. It was late morning and parking was scarce, but he got lucky and found a metered spot just up Fountain Street. He spent another hour in another conference room, explaining his case and answering question after question about what had led him to this long and tedious battle over a $2,094.05 sales tax bill.

The meeting ended, and he ambled along Fountain Street to his car. His pearl blue Volvo with the “veteran” license plate glinted in the afternoon sunshine.

And there, planted on his front windshield, like a bright red slap, was a $20 parking ticket.

larditi@projo.com