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(a) Except as specifically provided, it shall be unlawful for any official or employee of the city to make known information obtained pursuant to this article concerning the business financial affairs or operations of any person.
(b) The city council may authorize an examination of any return or audit of a specific taxpayer made pursuant to this article by authorized agents of the federal government, the State of Arizona, or any political subdivisions.
(c) The tax collector may provide to an Arizona county, city, or town any information concerning any taxes imposed in this article relative to the taxing ordinances of that county, city, or town.
(d) Successors, receivers, trustees, personal representatives, executors, guardians, administrators, and assignees, if directly interested, may be given information by the tax collector as to the items included in the measure and amounts of any unpaid tax, interest, and penalties required to be paid.
(e) Upon a written direction by the city attorney or other legal advisor to the city designated by the city council, officials or employees of the city may divulge the amount and source of income, profits, leases, or expenditures disclosed in any return or report, and the amount of such delinquent and unpaid tax, penalty, or interest, to a private collection agency having a written collection agreement with the city.
(f) The tax collector shall provide information to appropriate representatives of any Arizona city or town to comply with the provisions of A.R.S. Section 42-6003, A.R.S. Section 42-6005, and A.R.S. Section 42-6056.
(g) The tax collector may provide information to authorized agents of any other Arizona governmental agency involving the allocation of taxes imposed by section 19-435 upon publishing and distribution of periodicals.
(h) The tax collector may provide information regarding the enforcement and collection of taxes imposed by this article to any governmental agency with which the city has an agreement.
(Ord. No. 6674, § 3, 3-23-87; Ord. No. 9569, § 1, 6-18-01)
(a) The taxpayer problem resolution officer shall assist taxpayers in:
(1) Obtaining easily understandable tax information and information on audits, corrections and appeals procedures of the city.
(2) Answering questions regarding preparing and filing the returns required under this article.
(3) Locating documents filed with or payments submitted to the tax collector by the taxpayer.
(b) The taxpayer problem resolution officer shall also:
(1) Receive and evaluate complaints of improper, abusive or inefficient service by the tax collector or any of his designees, employees or agents and recommend to the city manager or, for a city without a city manager, the chief administrative officer appropriate action to correct such service.
(2) Identify policies and practices of the tax collector or any of his designees, employees or agents that might be barriers to the equitable treatment of taxpayers and recommend alternatives to the city manager or, for a city without a city manager, the chief administrative officer.
(3) Provide expeditious service to taxpayers whose problems are not resolved through normal channels.
(4) Negotiate with the tax collector, his designees, employees or agents to resolve the most complex and sensitive taxpayer problems.
(5) Take action to stop or prohibit the tax collector from taking an action against a taxpayer.
(6) Participate and present taxpayers' interests and concerns in meetings formulating the city's policies and procedures under and interpretation of this article.
(7) Compile data each year on the number and type of taxpayer complaints and evaluate the actions taken to resolve those complaints.
(8) Survey taxpayers each year to obtain their evaluation of the quality of service provided by the tax collector, his designees, employees and agents.
(9) Perform other functions which relate to taxpayer assistance as prescribed by the city manager or, for a city without a city manager, the chief administrative officer.
(c) Actions taken by the taxpayer problem resolution officer may be reviewed and/or modified only by the city manager or, for a city without a city manager, the chief administrative officer upon request of the tax collector or a taxpayer.
(d) The mayor and council of the city shall be provided with a report quarterly which identifies:
(1) Any complaints of improper, abusive or inefficient service received by the taxpayer problem resolution officer since the date of the last report.
(2) Any recommendations made, action taken or surveys obtained by the taxpayer problem resolution officer pursuant to subsection (b)(1)--(9) above, since the date of the last report.
(Ord. No. 8784, § 10, 12-2-96)
(a) The taxpayer problem resolution officer, with or without a formal written request from a taxpayer, may issue a taxpayer assistance order that suspends or stays an action or proposed action by the tax collector if, in the problem resolution officer's determination, a taxpayer is suffering or will suffer a significant hardship due to the manner in which the tax collector is administering the tax laws.
(b) A taxpayer assistance order may require the tax collector to release any lien perfected under this chapter, or cease any action or refrain from taking any action to enforce against the taxpayer any section of this chapter pending resolution of the issue giving rise to the taxpayer assistance order.
(c) The taxpayer problem resolution officer, city manager or, for a city without a city manager, the chief administrative officer may modify, reverse or rescind a taxpayer assistance order. A taxpayer assistance order is binding on the tax collector until it is reversed or rescinded.
(d) The running of the applicable statute of limitations for any action that is the subject of a taxpayer assistance order is suspended from the date the taxpayer applies for the order or the date the order is issued, whichever is earlier, until the order's expiration date, modification date or recision date, if any. Interest that would otherwise accrue on an outstanding tax obligation is not affected by the issuance of a taxpayer assistance order.
(e) A taxpayer assistance order may not be used:
(1) To contest the merits of a tax liability.
(2) To substitute for informal protest procedures or administrative or judicial proceedings to review a deficiency assessment, collection action or denial of a refund claim.
(Ord. No. 8784, § 11, 12-2-96)
(a) The tax collector shall solicit evaluations from taxpayers and include such evaluations in the performance appraisals of his employees, where applicable.
(b) The tax collector shall not evaluate an employee on the basis of taxes assessed or collected by that employee.
(Ord. No. 8784, § 12, 12-2-96)
(a) Returns. The returns required under this article shall be made upon forms prescribed or approved by the tax collector, and shall be considered filed only when the accuracy of the return has been attested to, by signature upon the form, by an authorized agent of the taxpayer, and when such form has been received by the tax collector. (Reg. 520.1).
(b) Payment. If payment is made in any form other than United States legal tender, the tax obligation shall not be satisfied until the payment has been honored in funds.
(c) Requirement of Security. If a taxpayer has remitted payment in the form of a check or other form of draw upon a bank or third party and such remittance has not been honored in funds, the tax collector may demand security for future payments.
(d) Method of Reporting. Each taxpayer shall elect to report on either a cash receipts basis or an accrual basis and shall indicate the choice on the privilege license application. A taxpayer shall not change his reporting method without receiving prior written approval by the tax collector. (Reg. 520.2)
(1) Taxpayers must report all gross income subject to the tax using the same basis of reporting.
(2) Taxes imposed upon construction contracting shall be reported as follows:
a. Construction contractors shall report on either a progressive billing ("accrual") basis or cash receipts basis.
b. Speculative builders shall report the gross income derived from sale of improved real property at close of escrow or at transfer of title or possession, whichever occurs earlier.
c. Owner-builders who are not speculative builders shall report taxable amounts as provided in section 19-417.
(Ord. No. 6674, § 3, 3-23-87)
(a) When Tax Due. Except as provided elsewhere in this section, the taxes shall be due and payable monthly on or before the twentieth day of the month next succeeding the month in which the tax accrues.
(1) Quarterly returns. The tax collector may authorize a taxpayer whose reporting history indicates an estimated annual city privilege and use tax liability on taxable gross income in excess of five thousand dollars ($5,000.00) but less than fifty thousand dollars ($50,000.00) to file returns on a calendar-quarterly basis. The taxes for each calendar quarter shall be due and payable on or before the twentieth day of the month next succeeding the end of each calendar quarter.
(2) Annual returns. The tax collector may authorize a taxpayer whose reporting history indicates an estimated annual city privilege and use tax liability on taxable gross income of not more than five thousand dollars ($5,000.00) to file returns for such taxes on a calendar-annual basis. The taxes for each calendar year shall be due and payable on or before the twentieth day of January of the following year.
(b) Any person who is engaged in or conducting business in two (2) or more locations or under two (2) or more business names shall file the return required under this chapter by electronic means.
(c) The Department, for any taxpayer whose estimated annual liability for taxes imposed or administered by A.R.S. Title 42, Chapter 5, Article 1 or A.R.S. Title 42, Chapter 6 is between two thousand dollars ($2,000) and eight thousand dollars ($8,000), shall authorize such taxpayer to pay such taxes on a quarterly basis. The Department, for any taxpayer whose estimated annual liability for taxes imposed or administered by A.R.S. Title 42, Chapter 5, Article 1 or A.R.S. Title 42, Chapter 6 is less than two thousand dollars ($2,000) shall authorize such taxpayer to pay such taxes on an annual basis.
(d) Delinquency Date. The taxes levied under this article will be considered delinquent in accordance with A.R.S. Section 42-5014, as follows:
(1) For taxpayers that are required or elect to file and pay electronically in any month, if not received by the department on or before the last business day of the month.
(2) For all other taxpayers, if not received by the department on or before the business day preceding the last business day of the month.
(e) Jeopardy reporting. If the tax collector determines that the collection of any tax due to the city is in jeopardy, the tax collector may direct the taxpayer to file his return and remit the tax on a weekly, daily or transaction-by-transaction basis. Such return and remittance shall be due upon the date fixed by the tax collector, and the delinquency date shall be the following day.
(f) Extensions. The tax collector may extend the time for filing a return, for good cause shown, and only when requested in writing and received by the tax collector prior to the tax due date. However, the time for filing such return shall not be extended beyond the last business day of the month next succeeding the due date of such return. In such cases, only the penalties for late filing and late payment may be waived by the tax collector for filing and payment within the extension period. Notwithstanding the granting of an extension, the interest payable for late payment of taxes shall be paid for the period commencing upon the original delinquency date and ending on the date the tax is paid. The interest may not be waived by the tax collector.
(Ord. No. 6674, § 3, 3-23-87; Ord. No. 7446, § 2.12, 7-2-90; Ord. No. 8440, § 18, 1-23-95; Ord. No. 11936, § 16, 7-12-22)
Editor’s note – Section 16 of Ord. No. 11936, adopted July 12, 2022, provides for an effective date of Jan. 1, 2015.
(a) Any taxpayer who failed to pay any of the taxes imposed by this chapter which were due or found to be due before the delinquency date shall be subject to and shall pay interest upon such tax until paid. From and after October 1, 2005, the interest rate shall be determined in the same manner and at the same times as prescribed by Section 6621 of the United States Internal Revenue Code and compounded annually under the method described in subsection (1) below. The rate of interest for both overpayments and underpayments for all taxpayers is the federal short-term rate, determined pursuant to Section 6621(B) of the Internal Revenue Code, plus three (3) percentage points. The interest rate prior to October 1, 2005, shall be one (1) percent per month. Said interest may be neither waived by the tax collector nor abated by the hearing officer except as it might relate to a tax abated as provided by section 19-570.
(1) On January 1 of each year, any interest outstanding as of that date that was accrued from and after October 1, 2005, is thereafter considered a part of the principal amount of the tax and accrues interest pursuant to this section.
(2) Interest accrued prior to October 1, 2005, shall not be added to the principal.
(b) In addition to interest assessed under subsection (a) above, any taxpayer who failed to pay any of the taxes imposed by this article which were due or found to be due before the delinquency date shall be subject to and shall pay any or all of the following civil penalties, in addition to any other penalties prescribed by this article:
(1) A taxpayer who fails to timely file a return for a tax imposed by this article shall pay a penalty of five (5) percent of the tax for each month or fraction of a month elapsing between the delinquency date of the return and the date on which it is filed, unless the taxpayer shows that the failure to timely file is due to reasonable cause and not due to willful neglect. This penalty shall not exceed twenty-five (25) percent of the tax due.
(2) A taxpayer who fails to pay the tax within the time prescribed shall pay a penalty of ten (10) percent of the unpaid tax, unless the taxpayer shows that the failure to timely pay is due to reasonable cause and not due to willful neglect. If the taxpayer is also subject to a penalty under subsection (b)(1) above for the same tax period, the total penalties under subsection (b)(1) and this subsection shall not exceed twenty-five (25) percent of the tax due.
(3) A taxpayer who fails or refuses to file a return within thirty (30) days of having received a written notice and demand from the tax collector shall pay a penalty of twenty-five (25) percent of the tax, unless the taxpayer shows that the failure is due to reasonable cause and not due to willful neglect or the tax collector agrees to a longer time period.
(4) If the cause of a tax deficiency is determined by the tax collector to be due to negligence, but without regard for intent to defraud, the taxpayer shall pay a penalty of ten (10) percent of the amount of deficiency. If the taxpayer is also subject to a penalty under subsection (b)(1) or (b)(2) above for the same tax period, the total penalties imposed under subsection (b)(1), (b)(2) and this subsection shall not exceed twenty-five (25) percent of the tax due.
(5) If the cause of a tax deficiency is determined by the tax collector to be due to civil fraud or evasion of the tax, the taxpayer shall pay a penalty of fifty (50) percent of the amount of deficiency.
(c) Penalties and interest imposed by this section are due and payable upon notice by the tax collector.
(d) If, following an audit, penalties attributable to the audit period are to be assessed pursuant to subsection (b)(1) or (b)(2) above, the tax collector, before assessing such penalties, must take into consideration any information or explanations provided by the taxpayer as to why the return was not timely filed and/or the tax was not timely paid. If such information and/or explanations are provided by the taxpayer, and the tax collector nevertheless decides to assess penalties pursuant to subsection (b)(1) or (b)(2) above, then, at the time the penalties are assessed, the tax collector must provide the taxpayer with a detailed written explanation of the basis for the tax collector's determination that the information and/or explanations provided by the taxpayer did not constitute reasonable cause.
(e) The assessment of the penalties prescribed by subsections (b)(3) through (b)(5) above must be approved on a case-by-case basis by the tax collector prior to such assessment. In addition, any assessment which includes penalties based upon subsection (b)(3), (b)(4), or (b)(5) above must be accompanied by a statement signed by the tax collector setting forth in detail the basis for the tax collector's determination that the penalties are warranted under the circumstances.
(f) The tax collector shall waive or adjust penalties imposed by subsections (b)(1) and (b)(2) above upon a finding that:
(1) In the past, the taxpayer has consistently filed and paid the taxes imposed by this article in a timely manner; or
(2) The amount of the penalty is greatly disproportionate to the amount of the tax; or
(3) The failure of a taxpayer to file a return and/or pay any tax by the delinquency date was caused by any of the following circumstances which must occur prior to the delinquency date of the return or payment in question:
a. The return was timely filed but was inadvertently forwarded to another taxing jurisdiction.
b. Erroneous or insufficient information was furnished the taxpayer by the tax collector or his employee or agent.
c. Death or serious illness of the taxpayer, member of his immediate family, or the preparer of the reports immediately prior to the due date.
d. Unavoidable absence of the taxpayer immediately prior to the due date.
e. Destruction, by fire or other casualty, of the taxpayer's place of business or records.
f. Prior to the due date, the taxpayer made application for proper forms which could not be furnished in sufficient time to permit a timely filing.
g. The taxpayer was in the process of pursuing an active protest of the tax in question in another taxing jurisdiction at the time the tax and/or return was due.
h. The taxpayer establishes through competent evidence that the taxpayer contacted a tax advisor who is competent on the specific tax matter and, after furnishing necessary and relevant information, the taxpayer was incorrectly advised that no tax was owed and/or the filing of a return was not required.
i. The taxpayer has never been audited by a city for the tax or on the issue in question and relied, in good faith, on a state exemption or interpretation.
j. The taxpayer can provide some public record (court case, report in a periodical, professional journal or publication, etc.) stating that the transaction is not subject to tax.
k. The state department of revenue, based upon the same facts and circumstances, abated penalties for the same filing period.
A taxpayer may also request a waiver or adjustment of penalty for a reason thought to be equally substantive to those reasons itemized above. All requests for waiver or adjustment of penalty must be in writing and shall contain all pertinent facts and other reliable and substantive evidence to support the request. In all cases, the burden of proof is upon the taxpayer.
(g) No request for waiver of penalty under subsection (f) above may be granted unless written request for waiver is received by the tax collector within forty-five (45) days following the imposition of penalty. Any taxpayer aggrieved by the refusal to grant a waiver under subsection (f) above may appeal under the provisions of section 19-570 provided that a petition of appeal or request for an extension is submitted to the tax collector within forty-five (45) days of the taxpayer's receipt of notice by the city that waiver has been denied.
(h) For the purpose of this section, "reasonable cause" shall mean that the taxpayer exercised ordinary business care and prudence, i.e., had a reasonable basis for believing that the tax did not apply to the business activity or the storage or use of the taxpayer's tangible personal property in this city.
(i) For the purpose of this section, "negligence" shall be characterized chiefly by inadvertence, thoughtlessness, inattention, or the like, rather than an "honest mistake." Examples of negligence include:
(1) The taxpayer's failure to maintain records in accordance with division III of this chapter;
(2) Repeated failures to timely file returns; or
(3) Gross ignorance of the law.
(Ord. No. 6674, § 3, 3-23-87; Ord. No. 6938, § 15, 4-25-88; Ord. No. 8784, § 13, 12-2-96; Ord. No. 10287, § 1, 6-13-06)
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