96-0854

Sales Tax

SIGNED 09/25/96

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX, )

Petitioner, ) ORDER

v. ) Appeal No. XXXXX

COLLECTION DIVISION OF THE ) Account No. XXXXX

UTAH STATE TAX COMMISSION, :

)

Respondent. : Tax Type: Sales Tax

_____________________________________

STATEMENT OF CASE

This matter came before the Utah State Tax Commission for an Initial Hearing pursuant to the provisions of Utah Code Ann. '59-1-502.5, originally on MMDDYY and was then continued until September 11, 1996. Jane Phan, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner by Telephone Conference call was XXXXX. Present and representing Respondent were XXXXXo.

Petitioner is appealing the assessment of penalties relating to Petitioner's sales tax in the amount of $$$$$ for the period of September 19YY and in the amount of $$$$$ for the period of December 19YY. Interest was also assessed but Petitioner did not dispute that it owed the interest.

Petitioner's representative explained that for the September 19YY period the penalty arose from an inadvertent transposition error. Petitioner maintains that this error could have been made by one of Petitioner's employees or one of the Tax Commission's employee.

For the December 19YY period, the funds for payment of the sales tax were timely transferred into the proper account and the sales tax return was mailed timely. However, due to an unintended error on the part of one of Petitioner's employees, the funds were not transferred timely. Petitioner discovered the error and corrected it prior to any action on the part of the Tax Commission, transferring the funds twenty-one days late. The penalty assessed was $$$$$. Petitioner's representative states that the amount of the penalty is too severe and it does not serve any real purpose.

At the original hearing Respondent requested Petitioner's bank account statement for verification that the funds had been available. Petitioner provided the requested verification prior to the MMDDYY, hearing and after review, Respondent's representatives stated that based on this additional information they recommended waiver of the penalties for both periods.

APPLICABLE LAW

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(10).)

DECISION AND ORDER

Based upon the information presented at the hearing, the recommendation of the Respondent, and the records of the Tax Commission, the Commission finds sufficient cause been shown to waive the penalties of $$$$$ for September 19YY and of XXXXX for December of 19YY relating to Petitioner's sales tax. Sufficient cause was not shown for waiver or reduction of the interest.

This decision does not limit a party's right to a Formal Hearing. However, this Decision and Order will become the Final Decision and Order of the Commission unless any party to this case files a written request within thirty (30) days of the date of this decision to proceed to a Formal Hearing. 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

Appeals Division

210 North 1950 West

Salt Lake City, Utah 84134

Failure to request a Formal Hearing will preclude any further administrative action or appeal rights in this matter.

DATED this 25th day of September, 1996.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

W. Val Oveson Richard B. McKeown