The bill requires the executive director of the department of revenue (executive director) to issue a voucher to the controller in favor of a purchaser who makes a valid and complete claim for a sales and use tax overpayment refund on or after July 1, 2022. The voucher must be for the amount of the refund of the sales or use tax overpayment without interest. Under the bill, if a purchaser files a sales and use tax refund claim between July 1, 2022, and July 1, 2026, interest will accrue on the refund from the date that the purchaser files the claim, so long as the refund is paid more than 180 days from the date that the purchaser files the claim.
If a purchaser
makes files a frivolous claim for a sales and use tax refund that is incomplete, duplicative of another claim, or lacks a reasonable basis in law or fact , the bill requires the executive director of the department of revenue (executive director) to assess and collect, in addition to other penalties provided by law, a civil penalty. The civil penalty is equal to 5% of the total refund claimed if the claim is materially incomplete, and is equal to 10% of the total refund claimed if the claim is duplicative or lacking a reasonable basis in law or in fact . Prior to assessing the civil penalty for a claim that the executive director deems materially incomplete, the executive director must provide notice to the purchaser or the preparer of the claim, specify what is missing, and state what conditions will lead to the executive director assessing a civil penalty. If the frivolous sales and use tax refund claim on which the executive director assesses a civil penalty is prepared, in whole or in part, by a person other than the purchaser, the executive director can impose the penalty on that other person. The executive director shall give the person against whom the civil penalty is assessed written notice, and that person may petition for a hearing and appeal the civil penalty. In certain cases, the executive director may waive this the penalty.
(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)
(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)