01-1937

Motor Fuel

Signed: 4/10/02

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

PETITIONER, )

) ORDER

Petitioner, )

) Appeal No. 01-1937

v. ) Account No. #####

)

AUDITING DIVISION OF THE UTAH ) Tax Type: Penalty Waiver/Motor Fuel

STATE TAX COMMISSION, )

) Judge: Rees

Respondent. )

_____________________________________

Presiding:

Irene Rees, Administrative Law Judge

Appearances:

For Petitioner: PETITIONER REP, Sr. Tax Counsel

For Respondent: Julie Jones, Audit Manager, and John Manning, Auditor

STATEMENT OF THE CASE

This matter came before the Utah State Tax Commission for a Status Conference on March 18, 2002. Upon agreement by the parties, the conference was converted to an Initial Hearing for the purpose of ruling on Petitioner's request for waiver of the penalty assessment imposed in this matter.

Petitioner does not dispute liability for the underlying tax, but seeks a waiver of the penalty for the month of March 2001, in the amount of $$$$$. Petitioner claims that the error giving rise to the assessment was a first time error, complicated by employee turnover and confusion about whether one of its suppliers was licensed to collect the tax.

In its Answer to the Petition for Redetermination, Respondent stated that it imposed the penalty because tax was collected, but it was not properly remitted to the Tax Commission. In this case, Petitioner was eligible to purchase the fuel tax exempt, but the supplier initially collected the tax for Petitioner. At some point, Petitioner asked for and received a refund of the tax collected from the supplier, but failed to remit the tax to the Tax Commission.

Respondent states that subsequent periods are under review, and the same kinds of error may give rise to assessments for those periods. However, the testimony supports Petitioner's claim that this was a first time, unintentional error.

APPLICABLE LAW

The Tax Commission has authority to waive, reduce, or compromise penalties and interest upon a showing of reasonable cause. Utah Code Ann. '59-1-401(10).

DECISION AND ORDER

The Commission waives the penalty assessment for this audit period on the basis of Petitioner's previous reporting and payment history.

This decision does not limit a party's right to a Formal Hearing. However, this Decision and Order will become the Final Decision and Order of the Commission unless any party to this case files a written request within thirty (30) days of the date of this decision to proceed to a Formal Hearing. Such a request shall be mailed to the address listed below and must include the Petitioner's name, address, and appeal number:

Utah State Tax Commission

Appeals Division

210 North 1950 West

Salt Lake City, Utah 84134

Failure to request a Formal Hearing will preclude any further appeal rights in this matter.

DATED this 10^th day of April , 2002.

____________________________________

Irene Rees

Administrative Law Judge

BY ORDER OF THE UTAH STATE TAX COMMISSION.

The Commission has reviewed this case and the undersigned concur in this decision.

DATED this 10^th day of April , 2002.

Pam Hendrickson R. Bruce Johnson

Commission Chair Commissioner

Palmer DePaulis Marc B. Johnson

Commissioner Commissioner