Tax Commission, Auditing

Section R865-19S-103

Municipal Energy Sales and Use Tax Pursuant to Utah Code Ann. Sections 10-1-303, 10-1-306, and 10-1-307

Notice of Proposed Rule

(Amendment)

DAR File No.: 34757
Filed: 05/02/2011 09:24:17 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The proposed amendment replaces an unnecessary quarterly filing with an annual filing.

Summary of the rule or change:

The proposed amendment reduces the filing frequency from a quarterly to an annual filing for the report required from persons that deliver taxable energy to users for whom the person does not supply taxable energy.

State statutory or constitutional authorization for this rule:

• Section 10-1-303
• Section 10-1-307
• Section 10-1-306

Anticipated cost or savings to:

the state budget:

None--The proposed amendment reduces the frequency of filing for an information return.

local governments:

None--The proposed amendment reduces the frequency of filing for an information return.

small businesses:

None--The proposed amendment reduces the frequency of filing for an information return.

persons other than small businesses, businesses, or local governmental entities:

None--The proposed amendment reduces the frequency of filing for an information return.

Compliance costs for affected persons:

None--The proposed amendment reduces the filing frequency of an information return from a quarterly filing to an annual filing.

Comments by the department head on the fiscal impact the rule may have on businesses:

May reduce fiscal impact by reducing tax returns from form to one in each year.

Michael Cragun, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Tax Commission
Auditing
210 N 1950 W
SALT LAKE CITY, UT 84134

Direct questions regarding this rule to:

• Christa Johnson at the above address, by phone at 801-297-3901, by FAX at 801-297-3907, or by Internet E-mail at cj@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

06/14/2011

This rule may become effective on:

06/21/2011

Authorized by:

Michael Cragun, Tax Commissioner

R865. Tax Commission, Auditing.

R865-19S. Sales and Use Tax.

R865-19S-103. Municipal Energy Sales and Use Tax Pursuant to Utah Code Ann. Sections 10-1-303, 10-1-306, and 10-1-307.

[A.](1) Definitions.

[1.](a) "Gas" means natural gas in which those hydrocarbons, other than oil and natural gas liquids separated from natural gas, that occur naturally in the gaseous phase in the reservoir are produced and removed at the wellhead in gaseous form.

[2.](b) "Supplying taxable energy" means the selling of taxable energy to the user of the taxable energy.

[B.](2) Except as provided in [C.]Subsection (3), the delivered value of taxable energy for purposes of Title 10, Chapter 1, Part 3, shall be the arm's length sales price for that taxable energy.

[C.](3) If the arm's length sales price does not include all components of delivered value, any component of the delivered value that is not included in the sales price shall be determined with reference to the most applicable tariffed price of the gas corporation or electrical corporation in closest proximity to the taxpayer.

[D.](4) The point of sale or use of the taxable energy shall normally be the location of the taxpayer's meter unless the taxpayer demonstrates that the use is not in a municipality imposing the municipal energy sales and use tax.

[E.](5) An energy supplier shall collect the municipal energy sales and use tax on all component parts of the delivered value of the taxable energy for which the energy supplier bills the user of the taxable energy.

[F.](6) A user of taxable energy is liable for the municipal energy sales and use tax on any component of the delivered value of the taxable energy for which the energy supplier does not collect the municipal energy sales and use tax.

[G.](7) A user of taxable energy who is required to pay the municipal energy sales and use tax on any component of the delivered value of taxable energy shall remit that tax to the [Tax Commission]commission:

[1.](a) on forms provided by the [Tax Commission]commission, and

[2.](b) at the time and in the manner sales and use tax is remitted to the [Tax Commission]commission.

[H.](8) A person that delivers taxable energy to the point of sale or use of the taxable energy shall provide the following information to the [Tax Commission]commission for each user for whom the person does not supply taxable energy, but provides only the transportation component of the taxable energy's delivered value:

[1.](a) the name and address of the user of the taxable energy;

[2.](b) the volume of taxable energy delivered to the user; and

[3.](c) the entity from which the taxable energy was purchased.

[I.](9) The information required under [H.]Subsection (8) shall be provided to the [Tax Commission]commission:

[1. on or before the last day of the month following each calendar quarter; and

2.](a) for each user for whom, during the preceding calendar quarter, the person did not supply taxable energy, but provided only the transportation component of the taxable energy's delivered value ; and

(b)(i) except as provided in Subsection (9)(b)(ii), at the time the person delivering the taxable energy files sales and use tax returns with the commission; or

(ii) if the person delivering the taxable energy files an annual information return under Subsection 10-1-307(5), at the time that annual information return is filed with the commission.

 

KEY: charities, tax exemptions, religious activities, sales tax

Date of Enactment or Last Substantive Amendment: [January 27, ]2011

Notice of Continuation: March 13, 2007

Authorizing, and Implemented or Interpreted Law: 10-1-303; 10-1-306; 10-1-307