BEFORE THE UTAH STATE TAX
COMMISSION
_____________________________________
XXXX, )
Petitioner, )
) FINDINGS
OF FACT,
v. ) CONCLUSIONS OF LAW
) AND FINAL
DECISION
AUDITING
DIVISION OF THE )
UTAH STATE TAX
COMMISSION, ) Appeal No. 89-0505
)
) Account
No. XXXXX
Respondent. )
_____________________________________
STATEMENT OF CASE
This
matter came before the Utah State Tax Commission pursuant to the Utah
Administrative Procedures Act for a formal hearing on XXXXX before Joseph G.
Linford, Presiding Officer. The
Petitioner was represented by XXXXX.
Respondent was represented by XXXXX, Assistant Utah Attorney General,
and by XXXXX of the Auditing Division of the Utah State Tax Commission.
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 and use tax.
2. The period in question is XXXXX.
3. During the period in question Petitioner
purchased a truck in Utah that Petitioner intended to use exclusively in
California as a sales vehicle. Petitioner buys all of its vehicles in Utah as a
matter of course.
4. After buying the vehicle in question,
Petitioner discovered that under California law it could not be registered in
California if it was not purchased in California until it had 7,500 miles on
the odometer. Therefore, Petitioner
felt that it had to register the vehicle in Utah until it could be registered
in California.
5. The vehicle in question has never been in
Utah since it was purchased. When it
was purchased, Petitioner used its resale exemption number so that no tax was
paid at that time. Petitioner did not
fill out an exemption certificate.
6. Petitioner has since paid taxes for the
vehicle in California.
7. Petitioner is a Utah corporation with its
principle place of business in Utah, although it does do some business in the
state of California.
CONCLUSIONS OF LAW
1. Utah Code Ann. §59-12-104(9) provides that
an exemption will apply to sales of vehicles to bona fide nonresidents of Utah
which vehicles are not thereafter registered or used in the state except as
required to transport them to the borders of the state.
2. Utah Code Ann. §§59-1-401 and59-1-402
provide that penalties and interest shall be imposed for the late payment of
sales tax. No penalty was assessed in
this case, but interest which Petitioner is requesting to be waived has been
assessed.
3. Utah Code Ann. §59-1-401(8) provides that
the Tax Commission may upon reasonable cause shown waive or reduce penalties
and interest assessed under the above statutes.
4. Such reasonable cause has not been shown in
this case. Although it is evident that
Petitioner acted in good faith without any intent to deprive the State of taxes
due, the State was nevertheless deprived of the use of the tax funds in
question between the time that they should have been paid and the time that
they were paid. The State should be
compensated for that loss of use. Petitioner's good faith has already
apparently been taken into account by the Auditing Division's decision not to
assess a penalty in this case, but only interest.
5. It is also apparent under the above statutes
that the Petitioner does not qualify as a nonresident of the state of Utah, and
it also purchased the vehicle in Utah even though the vehicle was to be used
outside of the state. These factors render the vehicle taxable in Utah
regardless of where it is to be used.
6. Usually a taxpayer in Petitioner's situation
should be able to obtain from a state to which it has erroneously paid use tax
a refund when the Petitioner has paid sales tax in the state where the
transaction occurred. Such a refund
should be available to Petitioner in this case; however, to obtain such a
refund Petitioner must pursue the matter with California authorities and that
decision will be theirs to make.
DECISION AND ORDER
Based
upon the foregoing, it is the decision and order of the Utah State Tax
Commission that Petitioner's request for relief from payment of the sales tax
and of the interest be denied.
DATED
this 26th day of April, 1990.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger
O. Tew
Chairman Commissioner
ABSENT
Joe B.
Pacheco G.
Blaine Davis
Commissioner Commissioner