85-0052 - Minerals, Mine Occupation

BEFORE THE UTAH STATE TAX COMMISSION

_____________________________________

XXXXX, )

:

Petitioner )

: DECISION FROM

v. ) INFORMAL HEARING

:

UTAH STATE TAX COMMISSION ) Appeal No. 85-55-0052

PROPERTY TAX DIVISION :

)

Respondent :

_____________________________________

An Informal Hearing was held on XXXXX. XXXXX and XXXXX, Commissioners heard the matter for an in behalf of the Commission. The Petitioner was represented by XXXXX, and the Respondent was represented by XXXXX, XXXXX, and XXXXX.

STATEMENT OF CASE

This case involves the calculation of "net proceeds" on Utah State Tax Commission Form TC-205, Item No. 20. On the instructions to the form, Item 20 states "Net Proceeds":

Show as the first figure the year for which this return is made. The amount is Item 7 less Item 9. If deductions are in excess of receipts, the amount to show is zero. Show as the second figure the year immediately preceding, and as the third figure the year preceding the second. If no net proceeds are shown for any year, the amount should be states [sic] as none." (emphasis added)

The Petitioner argued the lack of statutory basis for using zero for years of loss instead of negative figures.

FINDINGS AND CONCLUSION

The Tax Commission, based upon the argument of counsel finds as follows:

1. Utah Code Ann. 59-5-48 defines net annual proceeds as "gross proceeds realized during the preceding calendar year" less a number of allowable deductions which are listed in the statute.

2. There is no current reference in Tax Commission rules concerning the method for valuing metalliferous mines. Property Tax Division personnel have researched Tax Commission records and state archive records back into the XXXXX and they have been unable to find records concerning this issue.

3. Non-metalliferous mines and other property valuation practices by the Property Tax Division allow the inclusion of negative values in the calculations for value.

4. The Commission fails to find in the referenced statute or in the arguments presented by the Respondent, justification to continue the practice of not allowing negative values when using net annual proceeds as part of the valuation of metalliferous mines.

DECISION

The Property Tax Division of the State Tax Commission is, therefore, directed to revise the assessment of the Petitioner. The Respondent is further directed to prepare a rule that complies with the state statute but which also insures that the property will be valued at its highest and best use.

DATED this 1 day of November, 1985.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

ABSENT

Mark K. Buchi Gary C. Cornia

Chairman Commissioner

R. H. Hansen Roger O. Tew

Commissioner Commissioner