SB 881 Modifies provisions relating to taxation
Sponsor: Sifton
LR Number: 6068S.01I Fiscal Note available
Committee: Ways and Means
Last Action: 4/10/2014 - SCS Voted Do Pass S Ways and Means Committee (6068S.02C) Journal Page:
Title: SCS SB 881 Calendar Position:
Effective Date: August 28, 2014

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SCS/SB 881 - This act modifies provisions relating to taxation.

BURDEN OF PROOF IN TAX LIABILITY DISPUTES (Section 136.300)

Currently, the Director of Revenue has the burden of proof in tax liability disputes if the taxpayer meets certain requirements. One such requirement is that if the taxpayer is a partnership, corporation, or trust, the taxpayer's net worth doesn't exceed $7 million and the taxpayer has no more than 500 employees. This act removes this requirement to put the burden of proof on the Director of Revenue. The act also allows the burden of proof to be placed on the Director of Revenue in tax exemption cases.

This provision is similar to SB 829 (2014) and HB 1455 (2014). This provision is similar to a provision in HCS/HBs 1179 & 1765 (2014) and CCS/HCS/SB 584 (2014).

ADMINISTRATIVE GARNISHMENT

(Section 140.910, 143.902, 144.380, an 144.690)

This act authorizes the Department of Revenue to impose administrative garnishments on persons owing delinquent income or sales and use taxes to the state. A certificate of lien must first be filed by the Department. The Department must notify both the delinquent taxpayer and the person in possession of assets belonging to, due, or to become due a delinquent taxpayer.

If a garnishment order is served on an employer or payor of the delinquent taxpayer, the employer or payor must transmit payment to the Department within 10 business days of the income becoming payable to the taxpayer. If a garnishment order is served on someone other than an employer or payor, such person must turn over assets belonging to the delinquent taxpayer within 10 days of the receipt of the order.

A person refusing to withhold or turn over assets as required under the garnishment order will be liable to the state in an amount equal to the amount not surrendered. Such person may also be fined up to $500.

Employers are prohibited from disciplining or discharging employees based on an administrative garnishment order. Discharge or discipline within 30 days of a garnishment order creates a rebuttable presumption that such actions were a result of the order. An employer may be fined up to $500 for discipline or discharge based on an administrative garnishment order. The employer may also be required to pay back wages, costs, attorney's fees, and withholdings taxes for the time that the employee was wrongfully discharged.

A certificate of lien may be filed against property owned by taxpayers delinquent in income taxes, sales taxes, or use taxes. This act specifies a similar procedure to be used for collection of delinquent use taxes as is currently used for income taxes and sales taxes.

These provisions are similar to HB 1680 (2014) and HB 554 (2013). These provisions are similar to a provisions in HB 1677 (2014).

SALES TAX ON ADMISSION OR FEES TO CERTAIN PLACES

(Section 144.010, 144.018, 144.020)

Currently, there is a sales tax on places of amusement, entertainment and recreation, and games and athletic events. This act specify that such tax shall only apply to places of dance, theater, orchestra and other performing arts productions, commercial sports, spectator sports, gambling, racetracks, arcades, theme and amusement parks, water parks, circuses, carnivals, festivals, air shows, museums, marinas, motion picture theaters, and other commercial attractions. This act specifies that certain not-for-profit entities exempt from sales and use taxes will not be required to charges sales tax for admission to their places of amusement, entertainment, recreation, games, or athletic events.

This provision is similar to SB 584 (2014) and HB 1179 (2014).

NOTICE OF SALES TAX MODIFICATIONS (Section 144.021)

This act requires the Department of Revenue to notify sellers if there has been a change in the interpretation of sales tax laws that modifies which items of personal property or services are taxable. If the Department fails to notify a seller of the change, the seller will not be liable for the additional taxes to be collected until the seller is notified.

This provision is similar to SB 662 (2014) and HB 2149 (2014). This provision is similar to a provision in CCS/SCS/SB 612 (2014).

MIKE HAMMANN