(A) Vested administration. The administration of this subchapter, including the duty of prescribing forms required under the terms of this subchapter, is vested in and shall be exercised by the Finance Director, except as otherwise specifically provided, and all payments shall be made to the Finance Director. If payment is made in any other form than money which is legal tender in the state and the United States of America, the tax obligation shall not be ended until the check, bank draft or money order has been honored by the person on whom drawn.
(B) Collector or agent may examine books and papers. The Collector or his or her authorized agents may examine any books, papers, records or other data bearing upon the correctness of any return or for the purpose of making a return where none has been made, as required by the provisions of this subchapter and may require the attendance of any person and take his or her testimony with respect to any matter, with power to administer oaths to the person. If any person summoned as a witness shall fail to obey any summons to appear before the Collector, or his or her authorized agent, or shall refuse to testify or answer any material question or to produce any books, records, papers or other data when required to do so, the failure or refusal shall be reported to the Town Attorney, who shall thereupon institute proceedings in the Superior Court of the county where the witness resides to compel obedience to any summons of the Collector or his or her authorized agent. Officers who serve summons and subpoenas, and witnesses attending, shall receive like compensation as officers and witnesses in the justice of the peace courts.
(C) Presumptions that all gross receipts are taxable. For the purpose of the proper administration of this subchapter and to prevent evasion of the tax, it shall be presumed that all gross receipts are subject to the tax until the contrary is established by the person seeking the exemption from taxation. The burden of providing that a sale of tangible personal property was not a sale at retail shall be upon the person who made it, unless the person shall have taken from the purchaser a certificate to the effect that the property was purchased for resale.
(D) Tax imposed is cumulative. The tax imposed by this subchapter shall be cumulative and supplemental to all other taxes levied by law.
(E) Records of the taxpayer.
(1) It is the duty of every person engaging or continuing in business activities within the town for which a privilege tax is imposed by this subchapter to keep and preserve for a minimum of three years, suitable records of the gross income, gross receipts of sales, invoices for goods and merchandise purchased and sold, resale certificates, job labor records and all other books or accounts as shall be necessary to determine the amount of tax for which the person is liable under the provisions of this subchapter. Collection of back privilege taxes by the town shall be limited to a period of three years prior to the date when the Tax Collector began an audit of the taxpayer’s books, notified the person through use of ordinary mail concerning an apparent violation of the chapter or took some other recorded action to require a privilege tax permit application or other compliance with this subchapter.
(2) All records mentioned in division (A) above shall be open for examination at any time by the Tax Collector during normal business hours and also at any other time that may be arranged by the Collector.
(F) Divulging of information forbidden. It is unlawful for any officer, employee or agent of the town to make known in any manner whatsoever the business affairs, operations or information obtained by an investigation of records and equipment of any person visited or examined in discharge of their official duty, or the amount or source of income, profits, leases, expenditures or any particular thereof, set forth or disclosed in any return or report, or the amount of tax paid. The Council may, by motion, authorize an examination of the reports made pursuant to this subchapter by the United States Director of Internal Revenue or the proper officials of the state. Successors, receivers, trustees, executors, administrators and assignees, if directly interested, may be given information as to the items included in the measure and amounts of any unpaid tax or amount of tax required to be collected, interest and penalties. Divulging of applicable information to any authorized employee or agent of an incorporated city or town shall be permitted when an employee or agent of another incorporated city or town is authorized by the Tax Collector to conduct audits for the town. Information supplied on privilege license applications shall not be considered as confidential. Any officer employee or agent of the town shall be authorized to divulge the confidential information as may be necessary upon the order of a court of competent jurisdiction.
(G) Inadequate records. In the event the records of the gross income, gross receipts or gross proceeds of sales of the business, kept by the taxpayer, are deemed by the Tax Collector to be unsuitable, or the taxpayer does not keep other books or records as may be necessary to determine the amount of the tax for which he or she is liable under the provisions of this subchapter, the Tax Collector may prescribe the form and manner of keeping the books and records. In the event the taxpayer fails or refuses to follow the prescribed forms, and the Tax Collector cannot ascertain from the records kept by the taxpayer the gross income, gross receipts or gross proceeds of sale of the business, or the amount of the tax for which the taxpayer is liable under the provisions of this subchapter, the Tax Collector may proceed as though the taxpayer failed or refused to make a return in the manner prescribed by this subchapter.
(H) When tax payable; monthly and quarterly returns.
(1) Except as otherwise specified in this subchapter, the taxes levied under this subchapter shall be due and payable on or before the last day of the month next succeeding the period in which the tax accrues and shall be delinquent five days thereafter. The taxpayer shall, on or before the last day of the stated month, make out a return showing the gross amount, any authorized deductions, taxable amount and amount of the tax due for the preceding month. The taxpayer shall be required to use the report form authorized by the Tax Collector, and shall mail or deliver the same together with remittance for the amount of tax due, payable to the town, to the Tax Collector or any town employee authorized to receive the payment. The tax return shall be signed by the taxpayer or his or her authorized agent, and the signature shall be evidence that the person signing the return verifies the accuracy of the information supplied in the return.
(2) In any case where the taxpayer has reported a total taxable amount of $1,500 or less for the previous calendar quarter of the year, the taxpayer may make application to report and pay the tax on a quarterly basis, upon the written approval of the Tax Collector. Any taxpayer on a quarterly reporting basis must report and pay the accrued tax due on or before the last day of the month following the calendar quarter to be reported. If the taxpayer later reports a total taxable amount for any quarter of $1,500 or more, he or she shall report and pay on a monthly basis.
(I) Cash receipts or accrual basis. The taxpayer may elect to file returns and pay his or her tax either on a cash receipts or accrual basis, but the taxpayer shall not change from one basis to the other without the prior written approval of the Tax Collector. As a condition of granting the approval, the Collector may require an audit of the taxpayer’s records.
(J) Consolidated returns. Any person engaging in two or more forms of business of like classification taxable under this subchapter may file a consolidated return covering all business activities of like classification engaged in within the town.
(K) Extension of time for making returns. The Tax Collector may for good cause extend the date for making any return required under the provisions of this subchapter, but the date for filing the return shall not be extended beyond the last day of the second month next succeeding the regular due date.
(L) Penalty for delinquency. Any taxpayer who shall have failed to pay the tax within five days from the date upon which the payment shall have become due shall be subject to and shall pay a penalty of 10% of the amount of the tax, together with interest on the tax at a rate of 0.5% per month or fraction thereof until paid.
(M) Correction of errors. If the taxpayer makes an error in computing the tax assessable against him or her, the Tax Collector shall correct the error and notify the taxpayer promptly by ordinary mail that the correction has been made. Any additional tax for which the taxpayer becomes liable shall be payable within ten days after the letter or form showing the correction is mailed to the taxpayer. If the taxpayer makes an error which results in overpayment of tax, the Tax Collector shall allow credit against tax due on future returns, or shall authorize a refund to the taxpayer.
(N) Duties of person quitting business; successor or assignee. Any person who sells his or her business or stock of goods or quits business shall be required to make the return provided for under this subchapter within 15 days after the date he or she sold his or her business or stock of goods, or quits business, and his or her successor in business or assignee shall be required to withhold a sufficient amount of the purchase money to cover the amount of the taxes due and unpaid until the time as the former owner shall produce a receipt from the Tax Collector showing that the taxes have been paid, or a certificate that no taxes are due.
(1) If the purchaser of a business or stock of goods shall fail to withhold purchase money and the taxes shall be due and unpaid after the 15-day period, he or she shall be personally liable for the payment of the taxes accrued and unpaid on account of the operation of the business by the former owner.
(2) Transaction privilege tax liability of the purchaser shall be limited to no more than that accrued during a period of one full year prior to date the business purchase becomes effective.
(3) If the purchaser refuses or fails to pay the back taxes accrued during the period within 30 days after the Tax Collector mails a letter or other notice by ordinary mail to the purchaser requesting payment of back taxes, the purchaser is guilty of a misdemeanor subject to the penalties provided in this subchapter.
(O) Tax is a lien; procedure.
(1) The tax imposed by this subchapter, if not reported and paid by the due date specified by this subchapter, shall constitute a lien on the property of any person subject to this subchapter. The procedure to perfect the lien shall be as prescribed by this section.
(2) The Tax Collector shall give written notice to the taxpayer at his or her last known mailing address by certified or registered mail or the notice may be sent to the address at which the business is conducted. The written notice shall indicate that the town will file a lien on the subject property unless the taxpayer reports and pays all the tax past due including any penalties and interest due under this subchapter, or provides satisfactory evidence to the Tax Collector that no taxes are due, within a period of 30 days from service or receipt of the written notice.
(3) If the taxpayer does not pay taxes due or provide evidence that no taxes are due within 30 days after service or receipt of the written notice, the Tax Collector may prepare in triplicate copies of a “notice of claim of lien” and file one copy with the County Recorder in which the property is located. The Tax Collector shall then promptly send by certified or registered mail a copy to the taxpayer at his or her last known mailing address or at the address at which the business is conducted. The “notice and claim of lien” shall contain the following:
(a) A description of the property sufficient for identification;
(b) The name of the taxpayer as owner or reputed owner of the property; and
(c) The amount of the delinquent tax, including penalties and interest or, if this amount cannot be determined precisely because suitable records and books were not made available by the taxpayer, the amount assessed, including penalties and interests, by the Tax Collector as authorized by this subchapter when the books and records are not available or are unsuitable.
(4) From and after the date of its recording in the office of the County Recorder, the lien shall attach to the property until paid. A sale of the property to satisfy the lien shall be made upon judgment of foreclosure and order of sale. The town shall have the right to bring an action to enforce the lien in the Superior Court of the county in which the property is located, at any time after its recording, but failure to enforce the lien by the action shall not affect its validity. The recorded “notice and claim of lien” shall be prima facie evidence of the truth of all matters recited therein and the regularity of all proceedings prior to the recording therein.
(5) A prior recording for the purposes provided in this section shall not be a bar to the subsequent recording of a lien for those purposes, and any number of the liens on the same property may be enforced in the same action.
(P) Taxpayer’s liability. The liability of the taxpayer for taxes due shall remain the same, whether he or she collects sufficient added payments from his or her customers to cover the taxes due.
(1) Where the taxpayer fails to show “tax collected”, deductible “repair labor” and other deductible “service” on invoices to customers, sales slips or cash register slips, and on all applicable books and records, he or she shall be liable for taxation on his or her full gross receipts without allowance for the items.
(2) The burden of proof for all deductions by any taxpayer shall be on the taxpayer, who must prove to the satisfaction of the Tax Collector that the deductions shall have been legal and proper under this subchapter. A person taking deductions for “resale” or for “payments to subcontractors” shall not take the deductions unless the persons for whom deductions are taken have obtained the required privilege tax permits.
(Q) Tax liabilities of partners. All taxes assessed upon the business activities of a partnership shall be a liability and charges against each and all of the individual partners; but when paid by the partnership, the liability against each and all of the individual partners shall cease.
(1974 Code, § 8-2-5) Penalty, see § 10.99