99-0104

Sales/Tourism

Signed 4/29/98

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

PETITIONER : ORDER

Petitioner, :

: Appeal No. 99-0104

v. : Account No. #####

COLLECTION DIVISION OF : Tax Type: Sales/Tourism

THE UTAH STATE TAX )

COMMISSION, : Judge: Phan

Respondent. :

_____________________________________

Presiding:

Jane Phan, Administrative Law Judge

Appearances:

For Petitioner:

For Respondent: Jan Sanchez, Supervisor, OIC/Waiver Unit

STATEMENT OF THE 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 March 31, 1999.

Petitioner is appealing the computer generated assessments of tourism fund tax, penalties and interest for the monthly filing periods of October 1997 through January 1998. The total amount of tourism tax assessed was $$$$$. The tax amount assessed was based on non-filing estimates and the penalties assessed were both a 10% late payment penalty and a 10% failure to file penalty.

The facts that gave rise to the assessment are very unique. Petitioner operates a restaurant in CITY UTAH. When Petitioner commenced the restaurant operation the building was located in COUNTY County and Petitioner's sales tax license was coded for COUNTY County at the State Tax Commission. However, the restaurant was located near the border between COUNTY County and COUNTY B County. Sometime after the restaurant opened for business, but prior to the periods at issue, the boundary line between COUNTY County and COUNTY B County was shifted and Petitioner's restaurant, unbeknownst to Petitioner's representative, was now located in COUNTY B County. COUNTY B County imposed the tourism tax effective October 1997. The Tax Commission notified those business whose licenses were coded to be in COUNTY B County that they needed to start collecting the tourism tax. Since Petitioner's license was coded as in COUTNY County, Petitioner was not notified.

In March of 1998 a Collection Division employee discovered the error and notified Petitioner's representative that Petitioners was now located in COUNTY B County and should start collecting and remitting to the Tax Commission the tourism tax. That same agent put a note in the Tax Commission's electronic file for Petitioner, indicating that effective March 1998 Petitioner was subject to the tourism tax. Petitioners' representative had been unaware that the restaurant was in COUNTY B County and as soon as she was notified, started paying the tourism tax to the Tax Commission and has been paying it since.

The assessment against Petitioner for the tourism tax for October 1997 through January 1998 was generated by the computer. Although the collection agent intended the change to be effective March 1998, when he changed the coding from COUNTY to COUNTY B County the computer automatically went back and generated an estimated tax assessment from the time the tourism tax went into effect in COUNTY B County.

DECISION AND ORDER

Due to the uniqueness of the situation and the fact that the assessment was generated by the computer and the computer apparently overrid what had been intended by the collection agent who worked the account, the Commission abates in its entirety the tourism tax, penalty and interest assessed for the monthly filing periods of October 1997 through January 1998. It is so ordered.

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 29TH day of April, 1998.

____________________________________

Jane Phan

Administrative Law Judge

BY ORDER OF THE UTAH STATE TAX COMMISSION.

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

DATED this 29th day of April, 1999.

Richard B. McKeown Pam Hendrickson

Chairman Commissioner

R. Bruce Johnson

Commissioner