96-2072
SALES TAX
SIGNED
11/29/96
BEFORE
THE UTAH STATE TAX COMMISSION
____________________________________
XXXXX, )
:
Petitioner, ) ORDER
:
v. ) Appeal No. 96-2072
:
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, on MMDDYY. 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 was XXXXX.
Petitioner is appealing the assessment of
penalties totaling $$$$$ and interest of approximately $$$$$, as well as the
disallowance of the vendor discount in the amount of $$$$$ relating to sales
tax for the January 19YY filing period.
Petitioner's representative explained that
Petitioner had made a transposition error in the preparation of its January
19YY return. Petitioner had computed
the vendor discount correctly to be $$$$$ but had inadvertently reported it on
the return as $$$$$. The result was a
small underpayment of tax in the amount of $$$$$. The error was caught by the Tax Commission and a Notice and
Demand for Payment of Taxes was mailed to Petitioner. However, at this point the Tax Commission had denied the entire
vendor discount so the Notice & Demand for Payment was for $$$$$ in
additional tax. Instead of paying the
additional taxes, Petitioner replied with a letter requesting that it be
allowed to pay the $$$$$ to compensate for the original error.
It was Respondent's position that the
assessment of penalty and interest, and disallowance of the vendor discount,
should be upheld. Respondent's
representative pointed out that Petitioner had prior delinquencies. She said that there was a delinquency in
19YY, 19YY and 19YY. However, she
acknowledged that since this time, there had been no errors until the error at
issue and that Petitioner had been filing monthly since July 19YY. She also pointed to the fact that Petitioner
did not correct the error within 30 days of the Notice and Demand for Payment.
APPLICABLE
LAW
The Tax Commission is granted the authority
to waive, reduce, or compromise penalties and interest upon a showing of
reasonable cause. (Utah Code Ann. '59-1-401(10).)
DECISION
AND ORDER
Based on the fact that Petitioner has had a
good account history for over five years, the fact that the error was an
inadvertent, transposition error, and the fact that Petitioner did attempt to
correct the error within thirty days of the Notice by mailing its MMDDYY,
letter, the Tax Commission finds sufficient cause has been shown to reinstate
the vendor discount. Because this was
not a first time error, nor was this an error corrected prior to notice from
the Tax Commission, sufficient cause was not shown for waiver of the $$$$$
penalty or the approximately $$$$$ in 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 29th day of November, 1996.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val Oveson Richard
B. McKeown
Chairman Commissioner
Joe B. Pacheco Alice Shearer
Commissioner Commissioner