BEFORE THE UTAH STATE TAX COMMISSION
Petitioner, ) FINDINGS OF FACT,
: CONCLUSIONS OF LAW
v. ) AND FINAL DECISION
COLLECTION DIVISION OF THE ) Appeal No. 92-1627
UTAH STATE TAX COMMISSION, :
) Tax Type: Drug Stamp Respondent.
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, attorney at law, represented Petitioner. XXXXX, Assistant Utah Attorney General, represented Respondent.
At the beginning of the hearing, the parties stipulated that the relevant facts in this matter were set forth in the police reports contained in the Commission's file, augmented by certain oral statements of fact submitted by Petitioner's attorney. Neither party presented any additional evidence.
Based upon the parties' stipulations, the Commission hereby makes its:
FINDINGS OF FACT
1. The tax in question is illegal drug stamp tax.
2. The period in question is March XXXXX.
3. Petitioner concedes that the substances upon which Respondent's amended assessment is based are, in fact, XXXXX grams of marijuana and XXXXX dosage units of LSD. Petitioner also concedes that he neither purchased nor affixed the requisite drug stamps to such marijuana and LSD.
4. On XXXXX, Petitioner was driving his automobile in XXXXX, Utah. A passenger, XXXXX, was also in the car. Petitioner was stopped by police officers for improper registration and other minor infractions. However, once Petitioner and XXXXX had been stopped, police discovered they were each subject to arrest warrants. Petitioner and XXXXX were placed in custody and Petitioner's car was searched. The officers found the subject marijuana and LSD inside XXXXX's backpack.
5. Petitioner pled guilty to the criminal offense of possession of marijuana with intent to distribute. In entering his guilty plea, Petitioner admitted he allowed XXXXX to smoke marijuana in his automobile, and therefore knew XXXXX possessed some amount of marijuana. Prosecuting authorities have dismissed all criminal charges relating to Petitioner's alleged possession of LSD.
CONCLUSIONS OF LAW
The Utah Illegal Drug Stamp Tax Act imposes a tax of $$$$$ per XXXXX dosage units on certain controlled substances, including LSD. The Act imposes a tax of $$$$$ per gram on marijuana. (Utah Code Ann. §59-19-102(1).)
A dealer may not possess any controlled substance upon which a tax is imposed by the Illegal Drug Stamp Tax Act unless the Tax has been paid on the controlled substance as evidenced by a stamp or other official indicia. (Utah Code Ann. §59-19-1004(2).)
"Dealer" means any person who, in violation of Utah law, manufactures, produces, ships, transports, or imports into Utah or in any manner acquires or possesses more than XXXXX grams of marijuana or seven or more grams of any controlled substance. (Utah Code Ann. §59-19-102(2).)
Any dealer violating the provisions of the Illegal Drug Stamp Tax Act is subject to a penalty of 100% of the tax, in addition to the tax itself. (Utah Code Ann. §59-19-106).
DECISION AND ORDER
Petitioner concedes that the substances in question are marijuana and LSD, that he did not purchase or affix the required drug stamps to such substances, and that the quantity of such substances are correct as set forth in Respondent's amended assessment. The only issue is whether Petitioner is a "dealer" of marijuana and LSD within the meaning of Utah's Illegal Drug Stamp Tax Act.
Section 59-19-102(2) of the Illegal Drug Stamp Tax Act defines "dealer" as one who, in violation of Utah law, manufactures, produces, ships, transports, or imports into Utah or in any manner acquires or possesses more than 42-1/2 grams of marijuana or ten or more dosage units of any controlled substance that is not sold by weight, such as LSD.
Petitioner has pled guilty to possession of the marijuana in question. In entering his guilty plea, Petitioner admitted that he knowingly used his car to transport XXXXX and XXXXX's marijuana. Under principles of collateral estoppel, Petitioner's admission in the criminal proceeding is binding in this proceeding as well. Petitioner's admission that he knowingly transported the marijuana is sufficient to bring him under the Illegal Drug Stamp Tax Act's definition of dealer with respect to the marijuana.
While Petitioner's guilty plea constitutes an admission that he knowingly transported the subject marijuana, there is no evidence that Petitioner knew of XXXXX's LSD. Criminal charges against Petitioner relating to the LSD have been dismissed. Based on the evidence available to it, the Commission concludes that Petitioner did not knowingly transport the subject LSD in his car. Therefore, the Petitioner cannot be considered a dealer of such LSD within the meaning of the Illegal Drug Stamp Tax Act.
Based on the foregoing, the Commission concludes that with respect to the marijuana in question, Petitioner was a dealer within the meaning of the Illegal Drug Stamp Tax Act. The Commission further concludes that Petitioner was not a dealer within the meaning of the Act with respect to the subject LSD.
Respondent is instructed to amend its previous audit in conformity with this decision and to provide a copy of the such amended audit to Petitioner. It is so ordered.
DATED this 10th day of August, 1993.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val Oveson* Roger O. Tew
Joe B. Pacheco Alice Shearer*