03-1253

Sales Tax/Revocation

 

BEFORE THE UTAH STATE TAX COMMISSION

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TAXPAYER SERVICES DIVISION,)ORDER OF REVOCATION

UTAH STATE TAX COMMISSION,)

†††††††† )

Petitioner,†††††††† )†††††††† Appeal No. 03-1253

)††††††††

v.)Account No. #####

)

RESPONDENT, †††† )†††††††† Tax Type:† Sales Tax/Revocation††††††††

††††††††††††††††††††††† )††††††††

)Judge:† Chapman

Respondent.†††† )†††††††††††††

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STATEMENT OF THE CASE

In 2003, the Petitioner filed an appeal with the Commission, in which it asked the Commission to revoke the Respondentís sales tax license.† Prior to a hearing on the matter, the parties entered into a Stipulation on January 29, 2004, whereby the revocation proceeding would cease and the Respondent could continue to operate under its sales tax license, as long as the Respondent met its obligations under the Stipulation.† The Respondentís obligations included making specified payments toward its tax delinquency and remaining current on its tax filings.† On February 5, 2004, the Commission approved the Stipulation.

On May 6, 2004, in accordance with the Stipulation, the Petitioner submitted an Affidavit of Alled Bates to Revoke Sales Tax License of Defendant.† In his affidavit, Mr. Bates indicated that the Respondent had failed to comply with the terms of the Stipulation.† Specifically, Mr. Bates swore that the Respondent had failed to file sales or withholding tax returns for the fourth quarter of 2003 or the first quarter of 2004.† In addition, Mr. Bates swore that the Respondent had not

 

remitted the monthly payment due on its delinquency since February 26, 2004.† Either of these non-actions would result in the Respondent being in noncompliance with the terms of the Stipulation.

On May 13, 2004, the Commission ordered the Respondent to show cause why the Commission should not revoke its sales tax license.† Respondent submitted a Reply to Order to Show Cause and Request for Hearing on May 24, 2004.† In its Reply, the Respondent acknowledged that it had failed to file the sales tax returns due and make the required payments due under the Stipulation.† The Respondent stated that it had now filed its delinquent sales tax returns for the last quarter of 2003 and first quarter of 2004.† Respondent also acknowledged that it had failed to make any monthly payment on its delinquency since February 26, 2004 because the monthly amount due was too high based on its cash flow.

The Commission is not convinced that the Respondent has made a good faith effort to comply with the terms of its Stipulation with the Petitioner.† Not only has the Respondent failed to file its sales tax returns on a timely basis since signing the agreement, but there is also no indication that the Respondent has timely filed or paid its withholding taxes, as was also required under the agreement and which Mr. Bates swore the respondent had failed to do.††† In addition, since February 26, 2004, the Respondent has made no payment toward its delinquent tax amounts.† Although the Respondent claimed that it has made no subsequent payment because the monthly payment amount was too high, the Commission notes that the Respondent did not make subsequent payments of any amount.† The Commission would have expected the Respondent to remit payments of an amount that its cash flow would have allowed if the reason for its nonpayment had indeed been because the amount due was too high.† However, because the Respondent did not make any subsequent payments, the Commission does not believe that the Respondent has demonstrated the ability or desire to meet its future and past tax obligations.† The Commission finds that the Respondent has violated the terms of its Stipulation with the Petitioner.

CONCLUSIONS OF LAW


Respondent has substantially failed to comply with provision of the Sales and Use Tax Act and for that reason the Commission revokes Respondent's sales tax license pursuant to Utah Code Ann. Sec. 59-12-106(1).

†††††††††† ORDER

Respondentís actions both before and after signing the Stipulation do not rise to the level of adequate cause necessary to convince the Commission not to revoke its sales tax license.† At this point in the collection process, the reasons offered by the Respondent for failing to comply with the terms of the Stipulation are insufficient to allow the Respondent to keep its sales tax license.† Based upon the foregoing, the Tax Commission revokes sales tax license number #####.

††††††††††††††††††††††† BY ORDER OF THE UTAH STATE TAX COMMISSION:

DATED this ††29th ††day of ††July† , 2004.

 

 

 

Pam Hendrickson†††† ††††††††††††††††††††††† ††††††††††††††††††††††† R. Bruce Johnson

Commission Chair††††††††††††††† ††††††††††††††††††††††† ††††††††††††††††††††††† Commissioner

 

 

 

Palmer DePaulis††††††††††††††††††††††† ††††††††††††††††††††††† ††††††††††††††††††††††† Marc B. Johnson

Commissioner† ††††††††††††††††††††††† ††††††††††††††††††††††† ††††††††††††††††††††††† Commissioner†