Tax Type
Retail Sales and Use Tax
Description
A compliance ratio which is acceptable for a fourth generation audit.
Topic
Allocation and Apportionment
Date Issued
03-12-1982
March 12, 1982
Re: §58-1118 Application/Sales and Use Tax
Certificate of Registration No. ***************
Dear ******************
This will reply to your letter of August 24, 1981 in which you apply for relief of penalty assessed in a recent sales and use tax audit.
Facts
The taxpayer, a manufacturing company was audited for sales and use tax, the fourth such audit conducted on the taxpayer 1 9 business. Under the sample audit technique it was determined that the use tax compliance was 55.7 percent and penalty was assessed on the use tax deficiency.
Taxpayer maintains that the use tax compliance ratio as computed by the department is in error and that no penalty should be applied.
Determination
Based upon the facts as set forth in your correspondence of June 2, 1981, we have determined that an alternative computation of the use tax compliance yields a compliance ratio which is acceptable for a fourth generation audit. Therefore, your assessment will be adjusted to remove the penalty applied to the use tax deficiency.
Sincerely,
W. H. Forst
State Tax Commissioner
Rulings of the Tax Commissioner