Tax Type
Retail Sales and Use Tax
Description
Audit penalty; Compliance ratio
Topic
Collection of Delinquent Tax
Date Issued
06-15-1992
June 15, 1992
Re: §58.1-1821 Application: Sales and Use Tax
Dear**************:
This is in reply to your letter of November 21, 1991 in which you request reconsideration of waiver of penalty assessed on a recent sales and use tax audit of**************(the Taxpayer).
Specifically, the Taxpayer is protesting the procedure used by the department in computing compliance ratios. For audit purposes, the department computes a compliance ratio for the sales portion of the audit (retail sales made by the taxpayer), and the use tax portion of the audit (purchases on which no sales tax has been paid). The Taxpayer feels the use tax compliance ratio should be computed on the combination of sales tax paid to vendors and use tax accruals. Virginia Regulation (VR) 630-10-109 addresses use tax and states, in part, the following:
-
- The use tax applies to the use, consumption or storage of tangible personal property in Virginia when the Virginia sales or use tax is not paid at the time the property is purchased. The rate of the state and local use tax are the same as the rates of the state and local sales tax. There is no duplication of the tax. (Emphasis added).
- The use tax applies to the use, consumption or storage of tangible personal property in Virginia when the Virginia sales or use tax is not paid at the time the property is purchased. The rate of the state and local use tax are the same as the rates of the state and local sales tax. There is no duplication of the tax. (Emphasis added).
Based on the above, and absent any extenuating circumstances on the Taxpayer's part, I find my determination of October 8, 1991 with regard to audit penalty to be correct and waiver of penalty to be unwarranted. Therefore, I must deem the remainder of the audit liability to be due and payable in full.
Sincerely,
W. H. Forst
Tax Commissioner
TPD/5860K
Rulings of the Tax Commissioner