Tax Type
Retail Sales and Use Tax
Description
Taxation of hazardous waste removal and disposal
Topic
Assessment
Tangible Personal Property
Date Issued
10-16-2006
October 16, 2006
Re: § 58.1-1821 Reconsideration: Retail Sales and Use Tax
Dear *****:
This is in response to your letter in which you request reconsideration of the Department's determination of October 1, 2004, which upheld a retail sales and use tax assessment issued to ***** (the "Taxpayer") for the period September 1997 through August 2000. I apologize for the delay in responding to your letter.
FACTS
The Taxpayer, an automotive paint and body shop, continues to maintain that it relied on erroneous advice from the Department regarding the taxation of hazardous waste removal and disposal charges billed to customers in transactions involving the sale of tangible personal property. The Department previously denied the Taxpayer's appeal of the assessment because it had no information concerning the specific questions provided over the telephone by the Taxpayer to the Department. The Taxpayer has provided additional details about the questions presented to the Department's representative and the responses to those questions. Based on the additional information provided, the Taxpayer requests the waiver of the contested assessment.
DETERMINATION
Virginia Code § 58.1-1835 requires the Tax Commissioner to abate any tax, interest, and penalty attributable to erroneous advice furnished to the taxpayer in writing by an employee of the Department acting in his official capacity if the written advice was reasonably relied upon by the taxpayer and was in response to a specific written request by the taxpayer.
The Taxpayer was previously advised of the Department's policy with respect to hazardous waste charges. This policy is explained in Virginia Tax Bulletin 94-10 (12/1/94). This policy was in effect when the Taxpayer began business. While the Taxpayer has provided additional details of the questions asked and the Department's answers to those questions, I note that the Taxpayer did not specifically ask the Department how the tax applies to charges for hazardous waste disposal. It is unreasonable to expect the Department to anticipate every possible issue that may be applicable to a particular business during a phone conversation. This is one reason that the law authorizes the abatement of assessments only when taxpayers make written requests for advice and the Department responds to those requests in writing.
CONCLUSION
Virginia Code § 58.1-1835 authorizes the abatement of tax, penalty and interest only in situations where erroneous advice is provided to taxpayers in writing. The Taxpayer did not submit a written request for information, and the Department did not provide erroneous written advice to the Taxpayer that resulted in the audit assessment. For these reasons, there is no basis to waive the assessment at issue. This is my final determination on this matter.
Based on this determination, the assessment is correct. An updated bill, with interest accrued to date, will be mailed shortly to the Taxpayer. No additional interest will accrue provided the outstanding assessment is paid within 30 days from the date of the updated bill.
The Code of Virginia section cited, along with other reference documents, are available on-line at www.tax.virginia.gov in the Tax Policy Library section of the Department's web site. If you have any questions concerning this determination, please contact ***** in the Department's Office of Policy and Administration, Appeals and Rulings, at *****.
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- Sincerely,
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Janie E. Bowen
Tax Commissioner
AR/56193S
Rulings of the Tax Commissioner