BEFORE THE UTAH STATE TAX
COMMISSION
_____________________________________
XXXXX )
:
Petitioner ) FINDINGS OF FACT,
: CONCLUSIONS
OF LAW
v. ) AND FINAL DECISION
:
) Appeal No.
89-0074
AUDITING
DIVISION OF THE : Account No. XXXXX
UTAH STATE TAX
COMMISSION )
Respondent :
_____________________________________
STATEMENT OF CASE
This
matter came before the Utah State Tax Commission pursuant to the Administrative
Procedures Act for a formal hearing on XXXXX, before XXXXX, Presiding
Officer. Petitioner was represented by
XXXXX, Senior Vice President of the Petitioner corporation. Respondent was represented by XXXXX,
Assistant Attorney General, and XXXXX of the Auditing Division of the Utah
State Tax Commission. This matter was
set for a prehearing conference but was converted to a formal hearing.
After
reviewing the evidence and arguments of the parties in the record and the
recommendation of the presiding officer, the Tax Commission hereby makes its:
FINDINGS OF FACT
1. The tax in question is sales tax.
2. The period in question is XXXXX through
XXXXX.
3. Petitioner failed to timely pay a required
prepayment of sales tax. This
deficiency was discovered by Respondent as the result of an audit. Respondent
assessed Petitioner for a state estimated payment, and then charged Petitioner
with penalty and interest on the difference between the actual liability and
the estimate. This is the first time
that the Petitioner has met the conditions under the statute which require
Petitioner to make such prepayments.
4. Petitioner states that the prepayment
deadline was impossible to meet because its records could not be completed
until after the filing deadline, because Petitioner s procedures were still
operating with the regular payment deadlines in mind and the prepayment caught
Petitioner by surprise. Payment of the
tax amount was made by Petitioner in the usual manner as though the prepayment
was not required.
5. Petitioner has had a good past history in
payment of its taxes. Petitioner indicates that it has made adjustments in
record keeping procedures to avoid future problems with the prepayment.
CONCLUSIONS OF LAW
1. Utah Code Annotated §59-12-108 and Utah
Administrative Rule R865-19S-86 provide for prepayment of sales taxes for
certain taxpayers and also provide that penalties shall be assessed for failure
to meet the prepayment deadline.
2. Utah Code Annotated §§59-1-401 and 59-1-402
provide that penalties and interest shall be assessed for late payment of
taxes.
3. Utah Code Annotated §59-1-401(8) provides
that upon reasonable cause shown, the Tax Commission may waive or reduce
penalties and interest assessed under the above statutes.
4. Such reasonable cause has been shown for
waiver of the penalty assessed. This is
the first time Petitioner has been required to make the prepayment. Petitioner's completed records were not
available to meet the prepayment deadline, and provisions have been made to
avoid this problem in the future. Such
reasonable cause has not been shown for waiver of the interest assessed because
the State has not had the use of these funds and should be compensated for that
use.
DECISION AND ORDER
Based
upon the foregoing, it is the decision and order of the Utah State Tax
Commission that Petitioner's request for waiver of the penalty be granted and
Petitioner's request for waiver of interest be denied. Any penalty amount relative to the
prepayment in question previously paid by Petitioner is to be refunded.
DATED
this 9th day of May, 1990.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco G.
Blaine Davis
Commissioner Commissioner