About the law
Businesses that are late remitting state sales taxes will now be notified of possible closure action if they are delinquent for two months within a two-year period, according to the law.
If a business is delinquent for the third month, the Tax Commission issues a closure notice.
If the business doesn't pay all the delinquent tax, entering into an approved payment plan or ask for an administrative hearing, the Tax Commission issues a closure order.
If a hearing is requested, the Tax Commission is to hold the hearing within two weeks of the request. However, the only valid defense is proof of paying the tax or submitting a valid payment plan.
If a closure order is issued, a notice would be posted at the business.
The new law is intended to make sure businesses that are delinquent in remitting the sales tax don't get too far behind, she said.
“Most businesses for the most part want to pay taxes,” Ross said.
“At times they use that to run their business, but that is not the intent of sales tax money. For businesses that pay timely, which the majority do, this levels the playing field because you don't want to be competing with a business that's using their sales tax money and you're paying yours.”
Ross said the Tax Commission will continue to work with businesses that fall behind in remitting their sales tax.
“There are times when people have had illnesses in their business,” she said. “We take circumstances into account, but this gives us a guideline that if somebody just traditionally doesn't pay their taxes timely. … We don't really ever want to shut a business down.”
The Tax Commission will develop a payment plan for delinquent businesses so they can pay their back taxes and remain operating, Ross said.
Delaney said he doubts the state would close down big retailers for being late with remitting sales taxes.
Ross said the Tax Commission applies its regulations evenly.
Big retailers usually have systems in place to make sure sales taxes are remitted to the state promptly.
“It will be fair from the smallest business up to the largest business,” she said.
“What we will try to do is just get the state tax dollars that citizens pay — it's their money. They pay it. It's never the business'.”