BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX
Petitioner, :
v. : INFORMAL DECISION
COLLECTION
DIVISION OF THE : Appeal No. 87-0150
STATE TAX
COMMISSION OF UTAH, )
Respondent. :
_____________________________________
STATEMENT OF CASE
An
Informal Hearing was held on XXXXX.
XXXXX, Attorney, represented the Petitioner, who was also present at the
hearing. XXXXX and XXXXX represented
Respondent. James E. Harward, Hearing
Officer, heard the matter for the State Tax Commission. Petitioner is protesting the sales tax
assessed against his purchase of a XXXXX automobile in XXXXX, the %%%%% fraud
penalty and interest.
Petitioner
testified that he had no intention to defraud the State of Utah of sales tax on
the XXXXX purchase of his XXXXX automobile. Petitioner was a student at XXXXX
and had completed his studies in XXXXX at the time that he purchased the
car. Petitioner is from XXXXX, was
employed part time with XXXXX, and was taking a leave of absence to find a job
in XXXXX or to go back to school in XXXXX. Petitioner did leave Utah, go to
XXXXX and register the car and pay sales tax in XXXXX. Subsequently Petitioner came back to Utah
for further education. Petitioner
argues that the issue of residency or domicile is one of intention and that his
return to Utah is not indicative of his residency status when he purchased the
car. Petitioner had closed his bank
accounts in Utah, terminated relations with the state, and had left Utah to
establish residency in XXXXX. His return
to Utah does not indicate that he committed fraud against Utah. Petitioner argues that he must have intent
to defraud the State and that he had no intent to commit fraud. Petitioner admitted that he was qualified as
a Utah resident at XXXXX. Respondent
argued that although Petitioner signed the non-resident affidavit, he was a resident
at the time he purchased the car.
Petitioner had filed a full year resident return with the State of Utah
and had paid resident tuition at XXXXX.
FINDINGS
The
Commission finds that although Petitioner had no intent to defraud the State of
Utah of sales tax on the purchase of his XXXXX, he was a resident at the time
of the purchase and should have paid sales tax in Utah. It is apparent to the Commission that
Petitioner did not fully understand the sales tax laws as they apply to the
purchase of automobiles in Utah. Petitioner's subsequent payment of sales tax
to XXXXX on the purchase of his car and his actions in severing ties with Utah
prior to his departure indicate to the Commission that Petitioner believed he
would qualify as a XXXXX resident with regards to the purchase of this
automobile. However, Petitioner was a
resident of Utah at the time of the purchase and should have paid a Utah sales
tax.
Petitioner
is liable to Utah for the full amount of the sales tax. Petitioner should apply
to the XXXXX State Tax Commission for a refund of the XXXXX taxes paid. Because Petitioner did not commit fraud but
was negligent in not fully apprising himself of the law, there should be
imposed a %%%%% negligence penalty.
DECISION AND ORDER
Therefore,
it is the Decision and Order of the Utah State Tax Commission to uphold the
sales tax assessment against Petitioner and a %%%%% negligence penalty rather
than the %%%%% fraud penalty which Respondent assessed. The Commission hereby
orders Respondent to adjust its records accordingly and to adjust interest if
necessary to reflect the reduced penalty.
DATED
this 1 day of September, 1987.
BY ORDER OF THE STATE TAX COMMISSION OF UTAH.
R. H. Hansen Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco G.
Blaine Davis
Commissioner Commissioner