BEFORE THE UTAH STATE TAX COMMISSION
Petitioner, : ORDER
v. : Appeal Nos. 93-2232
) and 93-2233
COLLECTIONS DIVISION OF THE :
UTAH STATE TAX COMMISSION, : Account Nos. XXXXX
Respondent. : and XXXXX
STATEMENT OF CASE
This matter came before the Utah State Tax Commission for a Settlement Conference pursuant to the provisions of Utah Code Ann. §59-1-502.5, on XXXXX. Lisa L. Olpin, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing the Petitioner were XXXXX, president, and XXXXX. Present and representing the Respondent was XXXXX.
Petitioner is seeking the waiver of interest assessed (over $$$$$) as a result of a sales and use tax audit for the period of XXXXX-XXXXX.
Petitioner had purchased new scanning equipment from XXXXX for faster check-out in its grocery stores. The state sales and use tax audit revealed, however, that these new registers had not been programmed to tax consumers on vendor coupons.
Petitioner called XXXXX who came and immediately remedied the problem.
Unfortunately for Petitioner, it was required to pay the taxes in the amount of nearly XXXXX that were uncollected from these coupons. The Commission, however, did abate the penalty assessments. The interest remaining totals nearly $$$$$.
In a stipulation dated XXXXX between Petitioner and the Auditing Division regarding the settlement of the audit in question, Petitioner agreed to pay the interest assessment. Now, however, Petitioner wants the interest abated. Petitioner explained that at the time it entered into the agreement it assumed that it would turn around and sue XXXXX for failing to properly program its registers to collect taxes on vendor coupons.
XXXXX, in the meantime, has filed bankruptcy and has gone out of business.
Petitioner contends that fairness demands that interest be abated in this case in that it has already paid the amount of uncollected taxes required. It would be a financial hardship to also pay the interest on money it never had in the first place.
DECISION AND ORDER
Based upon the information presented at the conference, and the records of the Tax Commission, the Commission finds sufficient cause has not been shown to waive the interest assessed for the period XXXXX.
Although it is true that Petitioner never collected the tax or had use of the tax funds, it is also true that the state was entitled to these funds at the time they were due. It is the state that has lost the use of the funds; it was Petitioner's obligation to collect them.
The earlier waiver of the penalty assessments recognizes the fact that Petitioner did not act negligently in failing to collect the taxes in question.
This Decision and Order will become the Final Decision and Order of the Commission unless any party to this case files a written request for a Formal Hearing within ten (10) days of the date of this decision. Such a request shall be mailed to the address listed below and must include the Petitioner's name, address, and appeal number:
Utah State Tax Commission
160 East 300 South
Salt Lake City, Utah 84134
It is so ordered.
DATED this 24th day of May, 1994.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val Oveson Roger O. Tew
Joe B. Pacheco Alice Shearer