(a) The burden of proof rests upon each vendor to show what part, if any, of the gross room revenue receipts are not taxable from the hotel or motel room rents; and for such purpose each vendor shall maintain and keep complete and accurate records of said room revenue together with a record of the tax collected thereon, upon the premises where the taxes imposed by this Chapter occurred, which shall include:
(1) Primary records such as all guest or rent registers, rent invoices, statements or bills, rent payments and/or refunds thereon, room rate sheets or cards of daily prices for each room, as required by Ohio R.C. 3731.16; receipts of taxes collected; copies of appropriate schedules of Federal Income Tax Returns, Ohio Sales Tax Returns, and Cuyahoga County Tax Returns on Lodging of Transient Guests; exemption certificates, tax payment receipts; cash register tapes and all other pertinent documents; and
(2) Secondary records such as bank deposit receipts and daily books, journals, or any other records in which the vendor accumulates data, which must be supported by complete detail in which such data was accumulated.
(b) Guest or rent invoices, statements or bills, and cash register tapes for taxable rent must state separately the total taxable rent and the tax charged and/or collected. The records must also show clearly the length of stay, in terms of consecutive days for each guest.
(c) All records relating to the collection and payment of the tax must be preserved by the vendor for five (5) years, unless the Director of Finance, or his agent, consents in writing to their destruction within that period, or by order requires that they be kept for a longer period. All such records no longer need to be preserved after an assessment for additional tax has been made and paid, including all penalties and interest thereon, for the period in such assessment. A copy of such paid assessments shall be maintained for five (5) years following the period included in such assessment.
(d) All such records and documents shall be open to the Director of Finance, or his agent, for inspection during regular business hours. The Director of Finance, or his agent, may from time to time, review, investigate, examine and audit any and all such records to determine if the proper tax has been returned and remitted. The Director of Finance, or his agent, also has the authority to remove such records as long as proper inventory of the documentation to be removed is provided to the vendor.
(1) The Director of Finance, or his agent, may interview the vendor or his/her employees and agents, and may take written statements whether or not under oath.
(2) If the Finance Director's, or his agent's, investigation of such records reveals that any tax or additional tax should properly have been returned and remitted by the Vendor, the Finance Director, or his agent, shall make an assessment of such tax or additional tax in the manner provided in paragraph (f) hereof.
(e) If any vendor fails to maintain complete primary sales records, accurately reflecting the total rents subject to the tax due thereon, or which may be utilized in verifying the accuracy of the figures reflected in the vendor's tax returns filed hereunder, the Finance Director, or his agent, will use one of the following methods for such verification:
(1) Determine the total amount of all rents, less rental refunds, when the full tax has also been refunded either in cash or by credit, as the facts may require, based upon any information in his possession.
(2) Determine taxable and non-taxable rents, or the ratio of taxable rents to total rents, or both, as the facts may require, based upon any information in his possession
The above description determinations may be based upon a sampling or test checks of the vendor's business activity for a representative period, or other information relating to the rental of rooms made by such vendor. The Finance Director, or his agent, may make the same determination where the facts in the Finance Director's, or his agent's, possession reasonably leads the Finance Director, or his agent, to believe that the amount of tax required to be collected is or should be greater than the amount remitted by the vendor.
(f) If any vendor:
(1) Fails to maintain complete records, as required hereby; or
(2) Fails or refuses to permit the Finance Director, or his agent, to inspect any records; or
(3) Refuses to permit the Finance Director, or his agent, to sample or test his business activity; or
(4) Having filed a return or returns, misrepresents or fails to disclose, any material fact or figure thereon; or
(5) Having collected the tax, fails to remit the same when due; or
(6) Fails to remit the correct amount of tax or interest thereon when due; or
(7) Fails to file a full and complete return when due:
The Finance Director, or his agent, shall determine the proper amount of tax by any of the means set forth herein above; the tax as so determined will be deemed to be the tax collected by such vendor during the entire period of time under review; and the Finance Director, or his agent, shall make an assessment of such amount of tax based upon such determination, less the tax paid during such period, if any,
A. Plus interest thereon at the rate of one percent (1%) per month from the time when the tax should have been paid;
B. Plus a penalty of twenty-five percent (25%) of the amount of the assessment of tax.
(g) No assessment, however, shall be made or issued against a vendor or consumer for any tax more than four (4) years after the return day for the period in which the taxable transaction giving rise to the assessment of the tax occurred, or after the return for said period was filed, whichever is later. The four-year period begins on the day when the vendor is notified of the onset of the audit.
(h) All returns, documents, and payments submitted by each vendor, all records and other documents examined, and all information or knowledge of any vendor's business obtained by the Director of Finance, or his agent, shall be treated as confidential by the Director of Finance, or his agent, and shall not be released except:
A. Upon order of a court of competent jurisdiction;
B. To a duly authorized officer or agent of the Federal government, the State of Ohio, or of Cuyahoga County; or
C. For municipal purposes, including but not limited to the inclusion in the City's receipt register or the inclusion, in the aggregate, of all collections under this Chapter in budgetary and or financial statement presentations as may be required.
Any request for information pertinent to this Chapter, other than those by the government entities identified herein, must be in writing and shall first be reviewed by the Director of Law in order to determine what information, under law, is to be released. Any violation of the provisions of this section shall be a misdemeanor of the fourth degree, and the violator shall thereafter be disqualified from acting in any official capacity whatsoever in connection with the assessment or collection of taxes under this Chapter.
(Ord. 81-2002. Passed 11-11-02.)