§ 13-125.2. Gross receipts tax—Collection procedures.

Unless otherwise provided in this article, the following provisions and procedures shall apply with respect to the enforcement and collection of any gross receipt taxes levied by the city pursuant to A.C.A. § 26-75-602.

(1)

Permits.

a.

It shall be unlawful for any seller to transact business within the city prior to the issuance and receipt of an A&P Tax permit from the commission's office or the office of its designated agent.

b.

A separate A&P Tax permit must be obtained from the commission's office for each location at or from which a seller makes sales subject to the A&P Tax. An A&P Tax permit shall be considered a sub license to a seller's primary business license issued by the city. Any revocation or suspension by the city of a seller's primary business license or of any other city-issued permit or license shall result in an automatic revocation or suspension of the seller's A&P Tax permit.

(2)

Application for permit. Any seller transacting business in the city shall file with the commission or its designated agent an application for an A&P Tax permit, the form and contents of which shall be as prescribed by the commission from time to time.

(3)

Permits not assignable, display required, and expiration.

a.

The A&P Tax permit shall not be assignable and shall be valid only for the seller in whose name it is issued and for the location thereon designated.

b.

The A&P Tax permit shall at all times be conspicuously displayed at the location thereon designated.

c.

All A&P Tax permits must be renewed annually through the commission or its designated agent's office. The A&P Tax permit shall expire automatically at the time of cessation of sales subject to the A&P Tax at the location designated thereon.

(4)

Discontinuance of business; unpaid A&P Taxes.

a.

Any seller operating under an A&P Tax permit that has expired or been revoked shall immediately return the A&P Tax permit to the commission or to its designated agent together with remittance of any unpaid and accrued A&P Taxes, interest, and/or penalty. A seller shall provide a notarized, written statement to the commission or to its designated agent that, as of an effective date, it will no longer be selling prepared food or beverages and desires to surrender its A&P Tax permit. The seller shall, however, remain liable for any accrued taxes to the effective date of the surrender of the A&P Tax permit.

b.

In the case of the sale of any business having sales subject to the A&P Tax, the A&P Tax shall be deemed to be due and payable at the time of the sale of fixtures and equipment incident to the business and shall constitute a lien in the commission's favor against said fixtures and equipment in the hands of the purchaser of the business until all A&P Taxes have been paid.

c.

Upon a seller's failure to timely report or to pay any and all accrued A&P Tax, the commission or its designated agent may require the seller to post a cash bond, in an amount determined by the commission not to exceed ten thousand dollars ($10,000.00), as assurance of remitting said due tax in the future. In the event that further failures to timely report or to pay A&P Tax occur within sixty (60) days of the initial failure(s) with respect to the same issued A&P Tax permit, the posted cash bond shall be forfeited in favor of the commission at which time a second cash bond, in an amount determined by the commission not to exceed twenty thousand dollars ($20,000.00), may be required from the seller. The second cash bond shall be forfeited in favor of the commission if delinquency continues for an additional sixty (60) days with respect to the subject A&P Tax permit. If failures to timely report or to pay A&P Tax remain persistent after one hundred twenty (120) days from the initial failure, then notice of revocation of the business license permit and of the A&P Tax permit may be sent to the seller, and the seller's primary business license, as well as the A&P Tax permit, may be revoked.

(5)

Revocation of permit; renewal.

a.

In the event that any holder of an A&P Tax permit issued hereunder is found, by the commission or its designated agent, to be in violation of the provisions of this article or the commission's rules and regulations, the commission or its designated agent is hereby authorized to serve notice on the holder of the A&P Tax permit, of the commission's intention to revoke such permit. Unless the seller has filed a notice for review with the commission or its designated agent, within ten (10) days of receipt of such notice, the commission or its designated agent shall proceed to revoke the A&P Tax permit.

b.

If a notice for review is timely filed with the commission, the commission or its designated agent shall conduct a review to receive any information the seller desires to present prior to final action being taken. The hearing shall be conducted at a time and place to be designated by the commission and the seller requesting the hearing shall be entitled to introduce testimony and be represented by counsel, and the commission shall determine whether the seller's A&P Tax permit should be revoked or suspended. Failure of the seller to appear at the hearing shall be grounds for the commission, acting through its designated agent, to revoke the seller's A&P Tax permit.

c.

The seller shall be entitled, within thirty (30) days from the date of any revocation of the A&P Tax permit, to appeal to the circuit court of Sebastian County.

d.

An appeal shall lie from the circuit court to the Supreme Court of Arkansas as in other cases provided by law.

e.

Any revoked A&P Tax permit may be reinstated upon the filing of proper tax returns and the payment of all A&P Taxes, interest accrued thereon, and/or any assessed penalty due or removal of any other cause or basis for the permit's revocation.

(6)

Preparation of tax returns; payment of A&P Tax.

a.

The A&P Tax shall be due and payable as of the first day of each calendar month by the seller and shall be delinquent if not paid on or before the first day of the next calendar month on official forms prepared by the commission.

b.

1.

It shall be the duty of the seller on or before the twentieth day of each calendar month to deliver to the commission or its designated agent, upon forms prescribed and furnished by the commission, a tax return under oath showing the total combined gross receipts which are subject to the A&P Tax for the preceding calendar month and the amount of tax due. The tax due shall be remitted with the tax return.

2.

The tax returns shall contain such further information as the commission may require and, once the seller has become liable for the payment of the A&P Tax, the seller must continue to file a tax return, even though no tax may be due, until such time as the seller surrenders the A&P Tax permit.

c.

If the tax return is delivered on or before the twentieth day of the calendar month, the seller may remit therewith to the commission ninety-eight (98) percent of the A&P Tax due on or before the twentieth of that calendar month. A tax return is considered to be "delivered" on the date it is postmarked if it is delivered by the U.S. Postal Service.

d.

Failure of the seller to remit the A&P Tax on or before the twentieth of each calendar month shall cause the seller to forfeit seller's claim to the discount and the seller must remit to the commission one hundred (100) percent of the amount of the A&P Tax due, plus any assessed penalty and interest accrued thereon; provided, however, no penalty for delinquency nor interest shall be assessed if payment thereof is made on or before the first day of the calendar month next following.

(7)

Examinations and investigations.

a.

In the administration of this article, the commission or its designated agent, for the purpose of determining the accuracy of a tax return or fixing any A&P Tax liability of a seller, may make an examination, investigation, or inspection of the place of business, the tangible personal property, equipment, and facilities, and the books, records, papers, vouchers, accounts, and documents of any seller or person.

b.

No seller shall be subjected to unnecessary examinations or investigations, and only one (1) inspection of a seller's books of account may be made for each taxable year unless the seller requests otherwise or unless the commission, after investigation, notifies the seller in writing that an additional inspection is necessary.

c.

1.

When conducting an investigation or an audit of any seller, the commission or its designated agent may, in its discretion and unless privileged by law, examine the records and files of any person, any other business, institution, financial institution, as well as the records of any state agency, agency of the United States government, or agency of any other state where permitted by agreement or reciprocity.

2.

The commission or its designated agent may compel production of these records by summons. A summons may be served directly by the commission or its designated agent.

d.

In the administration of this article, the commission or its designated agent may:

1.

Administer oaths, conduct hearings, and compel by summons the attendance of witnesses, testimony, and the production of any books, records, papers, or other data of any person or seller; or

2.

Examine under oath any person regarding the business of any seller concerning any matter incident to the administration of this article, and pay witness fees to such witness required by the commission or its designated agent to attend any hearing, witness fees being the same as those allowed to witnesses appearing before circuit courts of this state.

e.

1.

A commission investigation may extend to any person that the commission or its designated agent determines has access to information which may be relevant to the examination or investigation.

2.

When any summons requiring the production of records is served on a person that is not a seller, written notice of the summons shall be mailed to the seller that the seller's records are being summoned, at least fourteen (14) days prior to the date fixed in the summons as the day for the examination of the records.

3.

Notice to the seller required by this section is sufficient if it is mailed by certified mail to the last address on record with the commission or its designated agent.

f.

The commission shall honor any reasonable request by any seller to issue a summons on the seller's behalf.

g.

1.

The commission or the seller may apply to a court of competent jurisdiction in Sebastian County, Arkansas, for an order compelling the production of summoned records.

2.

Failure to comply with the order of the court for the production of records may be punished by the court as for contempt.

h.

1.

The cost of producing records of a third party required by a summons shall be borne by the seller if the seller requests the summons to be issued.

2.

If the commission or its designated agents initiate the summons for records in the possession of a third-party, the commission shall bear the reasonable cost of producing the records. The commission or its designated agents may later assess the cost against any delinquent or deficient seller as determined by the records.

(8)

Time limitations for assessments, collection, refunds, and prosecution.

a.

Except as specifically provided otherwise in this article, no assessment of the A&P Tax shall be made after the expiration of three (3) years from the date the tax return was required to be filed or the date the tax return was actually filed, whichever period expires later. The commission shall not begin court proceedings after the expiration of the three-year period unless there has been a previous assessment for the collection of the tax.

b.

Upon written agreement of the commission and the seller, the time within which the commission may make a final assessment, as provided herein, may be extended to a date mutually agreed upon in the written agreement.

c.

Where, before the expiration of the time prescribed for the assessment of the tax or of extensions thereof, both the commission and the seller have consented in writing to an assessment after that time, then the A&P Tax may be assessed at any point prior to the expiration of the time agreed upon.

d.

In the case of a fraudulent tax return or failure to file a report or tax return required hereunder, the commission may compute, determine, and assess the estimated amount of A&P Tax due from any information in its possession or, at any time, may begin an action in a court of competent jurisdiction for the collection of the tax without assessment.

e.

Where the assessment of the A&P Tax has been made within the applicable period of limitation, the A&P Tax may be collected by levy or proceeding in court, but only if the levy is made or the proceeding is begun within ten (10) years after the date of the assessment of the tax.

(9)

Notice requirements.

a.

1.

The commission shall give a seller notice of any proposed or final assessment, demand, decision, or hearing before the commission or its designated body which directly involves that seller.

2.

Unless provided otherwise by this article, all notices required to be given by the commission to a seller shall be served either by personal service or sent by mail to the seller's last address on record with the commission. Except as to notices of final assessment, if this mail is returned unclaimed or refused, then proper notice shall be deemed to have been served and given, and the commission may take any action permitted by this article or otherwise by law.

3.

All notices of final assessment hereunder shall be sent either by certified mail, return receipt requested, or shall be by personal service.

b.

The seller, when giving notice to the commission, shall give notice either by mail or by personal service on the commission. The notice the seller gives shall be effective when postmarked or, in case of personal service, when so served.

c.

The commission and any seller may, by prior written agreement, provide for any other reasonable means of giving notice.

d.

All notices shall be in writing.

(10)

Assessment and collection of A&P Tax generally.

a.

1.

The commission or its designated agent is authorized and required to make the inquiries, determinations, and assessments of the A&P Tax, including interest, and assessable penalties, imposed hereby.

2.

The assessment shall be made by recording the liability of the seller in the commission's office or in the office of its designated agent.

b.

1.

The commission or its designated agent shall collect all A&P Taxes imposed by law.

2.

As soon as practicable after the making of assessment of the A&P Tax, the commission or its designated agent shall give notice to each person liable as a seller of the unpaid tax, stating the amount of the assessment and demanding payment within ten (10) days.

3.

Upon receipt of notice and demand from the commission or from its designated agent, the seller liable for the A&P Tax shall pay the stated amount including any accrued interest, additions to tax, and assessable penalties at the place and time stated in the notice and demand.

(11)

Proposed assessments.

a.

1.

If any seller fails to file any tax return as required hereunder, the commission or its designated agent, from any information in its possession or obtainable by it, may determine the correct amount of A&P Tax for the taxable period. If a tax return has been filed, the commission or its designated agent shall examine the tax return and make any audit or investigation that is considered necessary.

2.

When no tax return has been filed and the commission or its designated agent determines that there is A&P Tax due for the taxable period or when a tax return has been filed and the commission or its designated agent determines that the A&P Tax disclosed by the tax return is less than the tax disclosed by its examination, the commission or its designated agent shall propose the assessment of additional A&P Tax plus penalties, as the case may be, and shall give notice of the proposed assessment to the seller. The notice shall explain the basis for the proposed assessment and shall state that a final assessment, as provided for herein, will be made if the seller does not protest such proposed assessment as provided hereby. The seller does not have to protest a proposed assessment to be entitled subsequently to exercise the right to seek a judicial review of any final assessment resulting therefrom.

b.

Any demand for additional payment of the A&P Tax which is made as the result of a verification of a mathematical error on the tax return shall not be deemed to be a proposed assessment under the provisions of this section and shall not be subject to the hearing or appeal provisions of this section.

(12)

Seller's right to protest proposed assessment.

a.

Any seller who wishes to seek administrative relief from a proposed assessment of A&P Taxes by the commission or its designated agent shall follow the procedure provided by this section.

b.

1.

A seller may at its option either request the commission to consider its request for relief solely upon written documents furnished by the seller or upon the written documents and any evidence produced by the seller at a hearing.

2.

A seller who requests the commission to render its decision based on written documents is not entitled by law to any other administrative hearing prior to the commission's rendering of its decision and, if necessary, the issuing of a final assessment and demand for payment or issuing of a certificate of indebtedness.

c.

Within thirty (30) days after service of notice of the proposed assessment, the seller may file with the commission a written protest under oath, signed by seller or seller's authorized agent, setting forth the seller's reasons for opposing the proposed assessment.

d.

The commission may, in its discretion, extend the time for filing a protest for any period of time not to exceed an additional ninety-day period.

(13)

Hearing on protest of proposed assessments.

a.

1.

The commission or its designated agent or body shall serve as hearing officer to review all written protests submitted by sellers, hold all hearings, and make written findings as to the applicability of the proposed assessment.

2.

The hearing on written protests of proposed assessments and determinations made by the hearing officer shall not be subject to the provisions of the Arkansas Administrative Procedure Act, A.C.A. § 25-15-201 et seq.

b.

The hearing on the written protest shall be held in the commission's offices.

c.

1.

The hearing officer shall set the time and place for the hearing on the written protest and shall give the seller reasonable notice thereof.

2.

At the hearing, the seller may be represented by an authorized representative and may present evidence in support of its position.

3.

After the hearing, the hearing officer shall render a decision in writing and shall serve copies upon both the seller and the commission.

4.

A.

If the proposed assessment is sustained, in whole or part, the seller may request in writing, within twenty (20) days of the mailing of the decision, that the commission revise the decision of the hearing officer.

B.

If the commission refuses to make a revision or if the seller does not make a request for revision, then a final assessment shall be made upon the final determination of the hearing officer.

C.

(i)

In addition to the hearing procedures set out in this subsection, the commission or the hearing officer may hold administrative hearings by telephone, video conference, or other electronic means if the commission or the hearing officer determines that conducting the hearing in such a manner:

(a)

Is in the best interest of the seller and the commission;

(b)

Is agreed to by both parties; and

(c)

Is not fiscally unsound or administratively burdensome.

(ii)

The commission is authorized to contract with third parties for all services necessary to conduct hearings by telephone, video, or other electronic means.

(14)

Injunction proceedings. When a tax return required under this article has not been filed or does not furnish all the information required by the commission or when the A&P Taxes imposed by law have not been paid or when any required license or permit has not been secured, the commission may institute any necessary action or proceeding in a court of competent jurisdiction in Sebastian County to enjoin the seller from continuing operations until the report or tax return has been filed, required licenses or permits secured, or A&P Taxes paid as required. The injunction shall be issued without a bond being required from the commission.

(15)

Settlement or compromise of liability controversies.

a.

The commission may enter into an agreement to compound, settle, or compromise any controversy relating to the A&P Tax when:

1.

The controversy is over the amount of tax due; or

2.

The inability to pay results from the insolvency of the seller.

b.

The commission may waiver or remit the interest or penalty, or any portion thereof, ordinarily accruing because of a seller's failure to pay the A&P Tax within the statutory period allowed for its payment:

1.

If the seller's failure to pay the tax is satisfactorily explained to the commission; or

2.

If the failure results from a mistake by the seller of either the law or the facts subjecting him to such tax; or

3.

If the inability to pay the interest or penalty results from the insolvency or bankruptcy of the seller.

c.

In settling or compromising any controversy relating to the liability of a seller for the A&P Tax for any taxable period, the commission is authorized to enter into a written closing agreement concerning the liability. When the closing agreement is signed by the commission, it shall be final and conclusive, and, except upon a showing of fraud or misrepresentation of a material fact, no additional assessment or collection shall be made by the commission for the applicable taxable period.

d.

The commission shall promulgate rules and regulations establishing guidelines for determining whether a proposed offer in compromise is adequate and is acceptable to resolve a tax dispute.

(16)

Release of property from lien.

a.

Upon written application by any seller, the commission may release any property from the lien imposed by any assessment, order, judgment, or certificate of indebtedness obtained by or from any levy made by it if:

1.

Either full payment is made to the commission or its designated agent of the sum it considers adequate consideration for the release; or

2.

Adequate security deposit is made with the commission or its designated agent to secure the payment of the debt evidenced by the lien.

b.

When the commission determines that its lien or certificate of indebtedness is clouding the title of property because of an error in the description of properties or similarity in names, the commission may issue a release without the payment of any consideration.

(Ord. No. 33-11, § I, 5-3-11)