BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX
:
Petitioner, )
:
v. ) INFORMAL DECISION
:
)
COLLECTION
DIVISION OF THE : Appeal No. 86 0155
STATE TAX
COMMISSION OF UTAH, ) Acct. No. XXXXX
:
Respondent. )
_____________________________________
STATEMENT OF CASE
An
Informal Hearing was held on XXXXX.
Mark K. Buchi, Chairman, and Roger O. Tew, and R. H. Hansen,
Commissioners, heard the matter for the Utah State Tax Commission. XXXXX represented the Petitioner.
Petitioner
is appealing the penalty assessed against the late filing of its second
quarter, XXXXX, prepayment return.
Petitioner testified that when the Utah Legislature enacted the special
provisions for prepayment of sales, use, and resort community taxes during the
second quarter of each year, the Tax Commission notified Petitioner that if
Petitioner met certain conditions, it would be responsible for making the
prepayment by June 15. In XXXXX, the
first year the prepayment was required, Petitioner made its prepayment by June
15. The Tax Commission notice indicated
that Petitioner would receive a prepayment return before the prepayment was
due. In XXXXX, Petitioner did not
receive a prepayment return from the Tax Commission. In XXXXX, Petitioner did not receive a prepayment return from the
Tax Commission but it made its prepayment on time because it had become aware
that the prepayment was due yearly.
Petitioner asked Tax Commission representatives why it did not receive
the prepayment forms and was told that there was a hold on Petitioner's account
because there was a "tax situation pending," and forms would not be
mailed in that circumstance.
Petitioner
indicated that in XXXXX and in XXXXX it overpaid $$$$$ in each of the two years
because it included the transient room tax.
Petitioner said that it was not sure whether "resort community
tax" included the transient room tax and when it asked Tax Commission
representatives, the representatives were unclear or not sure.
Petitioner
admitted that it did not keep a record of telephone calls with the Tax
Commission, that it never sent a letter to the Tax Commission, and that it did
not look at the statutes even though they were referenced in the notice to
Petitioner. When asked whether the
Petitioner's case was affected by the fact that 98% of the taxpayers required
to file and prepay the tax did so, Petitioner's representative responded that
he did not think that affected Petitioner's case because Petitioner filed its
taxes timely in XXXXX but a large percentage of the taxpayers did not file
correctly during the first year with the result that the correct process was
indelibly printed on their minds in subsequent years. Petitioner requested a waiver of the penalty because it had no
intention to defraud the Tax Commission.
However, Petitioner conceded its liability for interest because
Petitioner erred in not making its XXXXX prepayment timely.
FINDINGS
1. Utah Code Ann. § 59-15-5.1 (1953) provides that taxpayers meeting certain
requirements must prepay not less than 90% of the amount of state and local
sales tax liability for April and May by June 15th of each year. The statute makes clear that the prepayment
will be required every year and not just in XXXXX.
2. The Commission finds that although there may
have been some confusion among Tax Commission staff in XXXXX regarding the
exact nature of the tax involved in the prepayment, the Petitioner had an
affirmative duty to apprise itself of the law.
Petitioner knew exactly what statute was involved, but did not make an
effort to determine the exact terms of the statute.
3. The Commission is sympathetic with the
bureaucratic maze that the Petitioner has gone through to determine its
prepayment responsibilities. However, Petitioner admits that the statute
clearly sets forth the requirements for prepayment. Petitioner should have taken the responsibility to read the
statute to determine what was required.
4. Petitioner had received notice of the
prepayment requirement from the State Tax Commission, knew of the statutory
requirement to prepay, did file and prepay the tax in XXXXX, but did not make
the prepayment for XXXXX as required by law.
5. Notwithstanding that Petitioner allegedly
did not receive a form, that is not a sufficient reason to fail to pay a tax
that is known to be due.
DECISION AND ORDER
Based
on the foregoing, it is the decision and order of the Utah State Tax Commission
that the penalty and interest assessment be sustained.
DATED
this 10 day of October, 1986.
BY ORDER OF THE UTAH STATE TAX COMMISSION OF
UTAH.
R. H. Hansen Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco G.
Blaine Davis *
Commissioner Commissioner