90-1600 - Sales

 

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

In Re: ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

XXXXX ) AND FINAL DECISION

:

: Appeal No. 90-1600

: Account No. XXXXX

___________________________________

STATEMENT OF CASE

This matter came before the Utah State Tax Commission for a formal hearing on XXXXX. Alan Hennebold, Presiding Officer, heard the matter for and on behalf of the Commission. XXXXX, Petitioner's tax supervisor, participated by telephone.

Based upon the evidence and testimony presented at the hearing, the Tax Commission hereby makes its:

FINDINGS OF FACT

1. The tax in question is use tax.

2. The period in question is XXXXX through XXXXX.

3. The Commission's staff audited Petitioner for compliance with Utah sales and use tax law for the period in question. The audit assessed Petitioner with an additional tax liability of $$$$$, plus associated interest and a XXXXX penalty.

4. Petitioner operates XXXXX at various national parks and monuments in Utah. It also operates convenience stores at those locations. Among other items, the convenience stores sell XXXXX products to the public. The audit disclosed that Petitioner had neglected to pay use tax on XXXXX products withdrawn from inventory and used in Petitioner's own operations. Petitioner does not contest the audit's findings.

5. The additional tax imposed by the audit represents less than XXXXX of Petitioner's total sales and use tax liability for the period in question. Apart from the present matter, Petitioner has properly reported and paid its use tax liability.

CONCLUSIONS OF LAW

Utah law authorizes imposition of a XXXXX penalty for negligent underpayment of tax. (Utah Code Ann. 59-1-401(3).)

The Tax Commission is granted the authority to waive, reduce, or compromise penalties and interest upon a showing of reasonable cause. (Utah Code Ann. 59-1-401(8).)

DECISION AND ORDER

The Petitioner admits it failed to pay use tax on paper products which were withdrawn from inventory, then consumed in Petitioner's operations. It has now paid such tax and associated interest.

Petitioner's failure to report and pay the use tax required under these circumstances is mitigated by its history of compliance with the sales and use tax laws, and also by the small size of Petitioner's error. The error amounted to less than XXXXX of Petitioner's total sales and use tax liability for the audit period.

Based on the foregoing considerations, the Commission finds reasonable cause to waive the penalty imposed against the Petitioner. Interest charges are not waived. It is so ordered.

DATED this 13th day of May, 1991.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco G. Blaine Davis

Commissioner Commissioner