98-0323

Motor Fuel

Signed 10/23/98

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

PETITIONER, :

: ORDER

Petitioner, :

: Appeal No. 98-0323

v. : Account No. #####

:

AUDITING DIVISION OF : Tax Type: Motor Fuel

THE UTAH STATE TAX )

COMMISSION, : Presiding: Pacheco

:

Respondent. :

_____________________________________

Presiding:

Joe B. Pacheco, Commissioner

Appearances:

For Petitioner: XXXXX

For Respondent: Ms. Julie Jones, from the Auditing Division

STATEMENT OF THE CASE

This matter came before the Utah State Tax Commission for a Status Conference and was therein converted to an Initial Hearing to be conducted pursuant to the provisions of Utah Code Ann. §59-1-502.5, on October 14, 1998.

This issue is a result of an audit of the motor fuel account for Petitioner. An assessment was made for exempt fuel sold to a non-exempt entity by Petitioner. Both parties acknowledged that the State of Utah had issued an exempt from purchases gas card in error and Petitioner had relied upon the use of that card by the entity during the audit period. The sales which Petitioner acknowledges were taxable transactions resulted in a $$$$$ penalty and interest of $$$$$ as of the date of the hearing. Respondent says that they do not believe that any negligent behavior was demonstrated as the Petitioner relied solely on the card that was issued by the State of Utah. Respondent said they assessed the interest on the account for the audit based on the statutory requirement. The Petitioner does not agree with the penalty or interest assessed and says that they were caught in the middle of these transactions as they relied on the issuance of the card and they paid the tax as soon as they were notified by the Auditing Division. Therefore Petitioner asks that the penalty and interest be abated.

APPLICABLE LAW

The Tax Commission is granted the authority to waive, reduce, or compromise penalty or interest upon showing a reasonable cause. Utah code Ann.§59-1-401(10).

DECISION AND ORDER

The Tax Commission finds sufficient cause exists to waive the penalty of $$$$$ but does not find sufficient cause to waive the interest related to the assessment. The State of Utah was denied the use of the funds during the audit period when the tax was due and payable to the State.

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 appeal rights in this matter.

DATED this 23 day of October, 1998.

____________________________________

Joe B. Pacheco

Commissioner

BY ORDER OF THE UTAH STATE TAX COMMISSION.

The Commission has reviewed this case and the undersigned concur in this decision.

DATED this 23 day of October, 1998.

Richard B. McKeown Pam Hendrickson

Chairman Commissioner

^^