S.B. 61 Enrolled

SALES AND USE TAX EXEMPTIONS - PENALTY AND INTEREST
1999 GENERAL SESSION
STATE OF UTAH
Sponsor: Howard A. Stephenson
AN ACT RELATING TO THE SALES AND USE TAX ACT; LIMITING THE AMOUNT OF
CERTAIN SALES AND USE TAX PENALTIES; AUTHORIZING THE STATE TAX
COMMISSION TO WAIVE, REDUCE, OR COMPROMISE CERTAIN SALES AND USE TAX
PENALTIES UNDER CERTAIN CIRCUMSTANCES; AND MAKING TECHNICAL
CHANGES.
This act affects sections of Utah Code Annotated 1953 as follows:
AMENDS:
59-12-105, as last amended by Chapter 318, Laws of Utah 1998
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 59-12-105 is amended to read:
59-12-105. Exempt sales to be reported -- Penalties.
[The] (1) An owner, vendor, or purchaser shall report to the commission the amount of
sales or uses exempt under [Subsections] Subsection 59-12-104 (14), (20), (40), [and] or (41)
[shall be reported to the commission by the owner, vendor, or purchaser, as the case may be. Upon
failure by].
(2) Except as provided in Subsections (3) and (4), if the owner, vendor, or purchaser fails
to report the full amount of the exemptions granted under [Subsections] Subsection 59-12-104
(14), (20), (40), [and] or (41) on the owner's, vendor's, or purchaser's original filed return, the
commission shall impose a penalty equal to the lesser of:
(a) 10% of the sales [or] and use tax that would have been imposed if the exemption had
not applied[. The penalty shall not be imposed if]; or
(b) $1,000.
(3) Notwithstanding Subsection (2), the commission may not impose a penalty under
Subsection (2) if the owner, vendor, or purchaser files an amended return containing the amount
of the exemption [is filed] prior to [notice of audit by the tax commission to] the owner, vendor,

or purchaser receiving a notice of audit from the commission.
(4) (a) Notwithstanding Subsection (2), the commission may waive, reduce, or compromise
a penalty imposed under this section if the commission finds there are reasonable grounds for the
waiver, reduction, or compromise.
(b) If the commission waives, reduces, or compromises a penalty under Subsection (4)(a),
the commission shall make a record of the grounds for waiving, reducing, or compromising the
penalty.

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