Senate Bill 0888

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    Florida Senate - 1999                                   SB 888

    By Senator Horne





    6-664-99

  1                      A bill to be entitled

  2         An act relating to tax administration; amending

  3         s. 199.106, F.S.; granting a credit against the

  4         intangibles tax to natural persons for an

  5         identical tax paid in another state; creating

  6         s. 201.165, F.S.; granting a credit against the

  7         documentary stamp tax for an identical tax paid

  8         in another state; amending s. 212.02, F.S.;

  9         amending the definition of the term "retail

10         sale" with respect to materials that are

11         incorporated into repaired motor vehicles,

12         airplanes, or boats; amending ss. 212.04,

13         212.12, 212.13, F.S., and creating s. 213.757,

14         F.S.; increasing the criminal penalties for

15         willful violations of certain tax provisions;

16         amending ss. 212.07, 212.18, F.S.; providing

17         for the annual issuance of resale certificates

18         to active accounts; amending s. 213.053, F.S.;

19         authorizing the Department of Revenue to

20         disclose to a dealer or taxpayer whether a

21         specified certificate is active, canceled,

22         inactive, or invalid; amending s. 212.08, F.S.;

23         amending the exemption for electricity and

24         steam used for manufacturing; providing an

25         exemption for sales or leases to organizations

26         holding current exemption from federal income

27         tax under s. 501(c)(3) of the Internal Revenue

28         Code; amending s. 213.27, F.S.; authorizing the

29         Department of Revenue to enter into contracts

30         with private vendors to develop an automated

31         case-tracking system; amending s. 213.67, F.S.;

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  1         authorizing the Department of Revenue to reduce

  2         the amount of an administrative garnishment

  3         which is subject to a freeze to the amount

  4         equal to the delinquent amount; amending ss.

  5         220.151, 220.21, 220.221, 220.222, F.S.;

  6         authorizing the Department of Revenue to accept

  7         electronic or telephonic corporate income tax

  8         returns in lieu of written paper returns;

  9         directing the Department of Revenue to

10         establish a toll-free number for the

11         verification of valid registration numbers and

12         resale certificates; directing the Department

13         of Revenue to establish a system for receiving

14         information from dealers regarding certificate

15         numbers; directing the Department of Revenue to

16         expand its dealer education program regarding

17         the proper use of resale certificates;

18         providing appropriations; providing an

19         effective date.

20

21  Be It Enacted by the Legislature of the State of Florida:

22

23         Section 1.  Subsections (2) and (3) of section 199.106,

24  Florida Statutes, are amended to read:

25         199.106  Credit for taxes imposed by other states.--

26         (2)  For intangible personal property that has a

27  taxable situs in this state under s. 199.175(1) or any similar

28  predecessor statute, a credit against the tax imposed by s.

29  199.032 is allowed to a taxpayer, other than a natural person,

30  in an amount equal to a like tax lawfully imposed and paid by

31  that taxpayer on the same property in another state, territory

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  1  of the United States, or the District of Columbia when the

  2  other taxing authority is also claiming situs under provisions

  3  similar or identical to those in s. 199.175(1) or any similar

  4  predecessor statute.  For purposes of this subsection, "like

  5  tax" means an ad valorem tax on intangible personal property

  6  which is also subject to tax under s. 199.032.  The credit may

  7  not exceed the tax imposed on the property under s. 199.032.

  8  Proof of entitlement to such a credit must be made pursuant to

  9  rules and forms adopted by the department.

10         (3)  The credits provided by this section subsections

11  (1) and (2) apply retroactively to December 31, 1979.

12  However, notwithstanding the retroactivity of these credit

13  provisions, this section does not reopen a closed period of

14  nonclaim under s. 215.26 or any other statute or extend the

15  period of nonclaim under s. 215.26 or any other statute.

16         Section 2.  Section 201.165, Florida Statutes, is

17  created to read:

18         201.165  Credit for tax paid to other states.--

19         (1)  With respect to each tax imposed by any section of

20  this chapter, a credit against the specific tax imposed by

21  that section is allowed in an amount equal to the amount of a

22  like tax lawfully imposed and paid on the same document or

23  instrument in another state or territory of the United States

24  or in the District of Columbia. As used in this subsection,

25  the term "like tax" means an excise tax on documents which is

26  in substance identical to the tax imposed by this chapter on

27  the same document. The credit may not exceed the amount of the

28  tax imposed on the document by this chapter. Proof of

29  entitlement to the credit must be provided to the department.

30  The department may adopt rules to implement this credit and

31  designate forms that establish what proof is required.

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  1         (2)  The credit provided by this section applies

  2  retroactively. Notwithstanding the retroactivity of this

  3  credit provision, this section does not reopen a closed period

  4  of nonclaim under s. 215.26 or any other statute, nor does

  5  this section extend the period of nonclaim under s. 215.26 or

  6  any other statute.

  7         Section 3.  Paragraph (c) of subsection (14) of section

  8  212.02, Florida Statutes, 1998 Supplement, is amended to read:

  9         212.02  Definitions.--The following terms and phrases

10  when used in this chapter have the meanings ascribed to them

11  in this section, except where the context clearly indicates a

12  different meaning:

13         (14)

14         (c)  "Retail sales," "sale at retail," "use,"

15  "storage," and "consumption" do not include materials,

16  containers, labels, sacks, bags, or similar items intended to

17  accompany a product sold to a customer without which delivery

18  of the product would be impracticable because of the character

19  of the contents and be used one time only for packaging

20  tangible personal property for sale or for the convenience of

21  the customer or for packaging in the process of providing a

22  service taxable under this chapter. When a separate charge for

23  packaging materials is made, the charge shall be considered

24  part of the sales price or rental charge for purposes of

25  determining the applicability of tax. The terms do term also

26  does not include the sale, use, storage, or consumption of

27  industrial materials, including chemicals and fuels except as

28  provided herein, for future processing, manufacture, or

29  conversion into articles of tangible personal property for

30  resale when such industrial materials, including chemicals and

31  fuels except as provided herein, become a component or

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  1  ingredient of the finished product and do not include the

  2  sale, use, storage, or consumption of materials for use in

  3  repairing a motor vehicle, airplane, or boat, when such

  4  materials are incorporated into the repaired vehicle,

  5  airplane, or boat. However, the terms include the sale, use,

  6  storage, or consumption of tangible personal property,

  7  including machinery and equipment or parts thereof, purchased

  8  electricity, and fuels used to power machinery, when such

  9  items are used and dissipated in fabricating, converting, or

10  processing tangible personal property for sale, even though

11  they may become ingredients or components of the tangible

12  personal property for sale through accident, wear, tear,

13  erosion, corrosion, or similar means. The terms do not include

14  the sale of materials to a registered repair facility for use

15  in repairing a motor vehicle, airplane, or boat when such

16  materials are incorporated into and sold as part of the

17  repair. Such a sale is to be considered a purchase for resale

18  by the repair facility even though every material is not

19  separately stated or separately priced on the repair invoice.

20         Section 4.  Effective January 1, 2000, subsections (4)

21  and (5) of section 212.04, Florida Statutes, 1998 Supplement,

22  are amended to read:

23         212.04  Admissions tax; rate, procedure, enforcement.--

24         (4)  Each person who exercises the privilege of

25  charging admission taxes, as herein defined, shall apply for,

26  and at that time shall furnish the information and comply with

27  the provisions of s. 212.18 not inconsistent herewith and

28  receive from the department, a certificate of right to

29  exercise such privilege, which certificate shall apply to each

30  place of business where such privilege is exercised and shall

31  be in the manner and form prescribed by the department.  Such

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  1  certificate shall be issued upon payment to the department of

  2  a registration fee of $5 by the applicant.  Each person

  3  exercising the privilege of charging such admission taxes as

  4  herein defined shall cause to be kept records and accounts

  5  showing the admission which shall be in the form as the

  6  department may from time to time prescribe, inclusive of

  7  records of all tickets numbered and issued for a period of not

  8  less than the time within which the department may, as

  9  permitted by s. 95.091(3), make an assessment with respect to

10  any admission evidenced by such records and accounts, and

11  inclusive of all bills or checks of customers who are charged

12  any of the taxes defined herein, showing the charge made to

13  each for that period.  The department is empowered to use each

14  and every one of the powers granted herein to the department

15  to discover the amount of tax to be paid by each such person

16  and to enforce the payment thereof as are hereby granted the

17  department for the discovery and enforcement of the payment of

18  taxes hereinafter levied on the sales of tangible personal

19  property.  The failure of any person to pay such taxes before

20  the 21st day of the succeeding month after the taxes are

21  collected shall render such person liable to the same

22  penalties that are hereafter imposed upon such person for

23  being delinquent in the payment of taxes imposed upon the

24  sales of tangible personal property; the failure of any person

25  to render returns and to pay taxes as prescribed herein shall

26  render such person subject to the same penalties, by way of

27  charges for delinquencies, at the rate of 10 percent per month

28  for a total amount of tax delinquent up to a total of 50

29  percent of such tax and at the rate of 100-percent penalty for

30  attempted evasion of payment of any such tax or for any

31

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  1  attempt to file false or misleading returns that are required

  2  to be filed by the department.

  3         (5)  All of the provisions of this chapter relating to

  4  collection, investigation, discovery, and aids to collection

  5  of taxes upon sales of tangible personal property shall

  6  likewise apply to all privileges described or referred to in

  7  this section, and the obligations imposed in this chapter upon

  8  retailers are hereby imposed upon the seller of such

  9  admissions. All penalties applicable to a dealer of tangible

10  personal property for failure to meet any such obligation,

11  including, but not limited to, any failure related to the

12  filing of returns, the payment of taxes, or the maintenance

13  and production of records, are applicable to the seller of

14  admissions. When tickets or admissions are sold and not used

15  but returned and credited by the seller, the seller may apply

16  to the department for a credit allowance for such returned

17  tickets or admissions if advance payments have been made by

18  the buyer and have been returned by the seller, upon such form

19  and in such manner as the department may from time to time

20  prescribe.  The department may, upon obtaining satisfactory

21  proof of the refunds on the part of the seller, credit the

22  seller for taxes paid upon admissions that have been returned

23  unused to the purchaser of those admissions. The seller of

24  admissions, upon the payment of the taxes before they become

25  delinquent and the rendering of the returns in accordance with

26  the requirement of the department and as provided in this law,

27  shall be entitled to a discount of 2.5 percent of the amount

28  of taxes upon the payment thereof before such taxes become

29  delinquent, in the same manner as permitted the sellers of

30  tangible personal property in this chapter.  However, if the

31  amount of the tax due and remitted to the department for the

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  1  reporting period exceeds $1,200, no discount shall be allowed

  2  for all amounts in excess of $1,200.

  3         Section 5.  Effective February 1, 2000, paragraph (b)

  4  of subsection (1) of section 212.07, Florida Statutes, 1998

  5  Supplement, is amended to read:

  6         212.07  Sales, storage, use tax; tax added to purchase

  7  price; dealer not to absorb; liability of purchasers who

  8  cannot prove payment of the tax; penalties; general

  9  exemptions.--

10         (1)

11         (b)  A resale must be in strict compliance with s.

12  212.18 and the rules and regulations, and any dealer who makes

13  a sale for resale which is not in strict compliance with s.

14  212.18 and the rules and regulations shall himself or herself

15  be liable for and pay the tax. A dealer who makes a sale for

16  resale shall document the exempt status of the transaction, as

17  established by rules adopted by the department, by retaining a

18  copy of the purchaser's resale certificate. In lieu of

19  maintaining a copy of the certificate, a dealer may document,

20  before the sale, an authorization number provided by the

21  department electronically or by telephone, or by other means

22  established by the department by rule. The department shall

23  adopt rules that provide that, for purchasers who continually

24  purchase on account from a dealer, the dealer may rely on a

25  resale certificate issued under s. 212.18(3)(c), which is

26  valid at the time of receipt from the purchaser, without

27  seeking annual verification of the resale certificate. A

28  dealer may, through the informal protest provided for in s.

29  213.21 and the rules of the Department of Revenue, provide the

30  department with evidence of the exempt status of a sale.  The

31  Department of Revenue shall adopt rules which provide that

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  1  valid resale certificates and Consumer certificates of

  2  exemption executed by those dealers or exempt entities that

  3  which were registered with the department at the time of sale,

  4  resale certificates provided by purchasers who were active

  5  dealers at the time of sale, and verification by the

  6  department of a purchaser's active dealer status at the time

  7  of sale in lieu of a resale certificate shall be accepted by

  8  the department when submitted during the protest period, but

  9  may not be accepted in any proceeding under chapter 120 or any

10  circuit court action instituted under chapter 72.

11         Section 6.  Paragraph (ii) of section 212.08, Florida

12  Statutes, 1998 Supplement, is amended, and paragraph (zz) is

13  added to that subsection, to read:

14         212.08  Sales, rental, use, consumption, distribution,

15  and storage tax; specified exemptions.--The sale at retail,

16  the rental, the use, the consumption, the distribution, and

17  the storage to be used or consumed in this state of the

18  following are hereby specifically exempt from the tax imposed

19  by this chapter.

20         (7)  MISCELLANEOUS EXEMPTIONS.--

21         (ii)  Certain electricity or steam uses.--

22         1.  Subject to the phase-in provisions in subparagraph

23  4., charges for electricity or steam used to operate machinery

24  and equipment at a fixed location in this state when such

25  machinery and equipment is used to manufacture, process,

26  compound, produce, or prepare for shipment items of tangible

27  personal property for sale, or to operate pollution control

28  equipment, recycling equipment, maintenance equipment, or

29  monitoring or control equipment used in such operations are

30  exempt to the extent provided in this paragraph. If In order

31  to qualify for this exemption, 75 percent or more of the

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  1  electricity or steam used at the fixed location is must be

  2  used to operate qualifying machinery or equipment, 100 percent

  3  of the charges for electricity or steam used at the fixed

  4  location is exempt. If less than 75 percent but 50 percent or

  5  more of the electricity or steam is used at the a fixed

  6  location is used to operate qualifying machinery or equipment,

  7  then it is presumed that 50 percent of the charges for

  8  electricity or steam used at the fixed location is exempt

  9  charge for electricity is for nonexempt purposes. If less than

10  50 percent of the electricity or steam used at the fixed

11  location is used to operate qualifying machinery and

12  equipment, none of the charges for electricity or steam used

13  at the fixed location is exempt.

14         2.  This exemption applies only to industries

15  classified under SIC Industry Major Group Numbers 10, 12, 13,

16  14, 20, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34,

17  35, 36, 37, 38, and 39. As used in this paragraph, "SIC" means

18  those classifications contained in the Standard Industrial

19  Classification Manual, 1987, as published by the Office of

20  Management and Budget, Executive Office of the President.

21         3.  Possession by a seller of a written certification

22  by the purchaser, certifying the purchaser's entitlement to an

23  exemption permitted by this subsection, relieves the seller

24  from the responsibility of collecting the tax on the

25  nontaxable amounts, and the department shall look solely to

26  the purchaser for recovery of such tax if it determines that

27  the purchaser was not entitled to the exemption.

28         4.  Such exemption shall be applied as follows:

29         a.  Beginning July 1, 1996, 20 percent of the charges

30  for such electricity shall be exempt.

31

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  1         b.  Beginning July 1, 1997, 40 percent of the charges

  2  for such electricity shall be exempt.

  3         c.  Beginning July 1, 1998, 60 percent of the charges

  4  for such electricity or steam shall be exempt.

  5         d.  Beginning July 1, 1999, 80 percent of the charges

  6  for such electricity or steam shall be exempt.

  7         e.  Beginning July 1, 2000, 100 percent of the charges

  8  for such electricity or steam shall be exempt.

  9         5.  Notwithstanding any other provision in this

10  paragraph to the contrary, in order to receive the exemption

11  provided in this paragraph a taxpayer must first register with

12  the WAGES Program Business Registry established by the local

13  WAGES coalition for the area in which the taxpayer is located.

14  Such registration establishes a commitment on the part of the

15  taxpayer to hire WAGES program participants to the maximum

16  extent possible consistent with the nature of their business.

17         6.a.  In order to determine whether the exemption

18  provided in this paragraph from the tax on charges for

19  electricity or steam has an effect on retaining or attracting

20  companies to this state, the Office of Program Policy Analysis

21  and Governmental Accountability shall periodically monitor and

22  report on the industries receiving the exemption.

23         b.  The first report shall be submitted no later than

24  January 1, 1997, and must be conducted in such a manner as to

25  specifically determine the number of companies within each SIC

26  Industry Major Group receiving the exemption as of September

27  1, 1996, and the number of individuals employed by companies

28  within each SIC Industry Major Group receiving the exemption

29  as of September 1, 1996.

30         c.  The second report shall be submitted no later than

31  January 1, 2001, and must be comprehensive in scope, but, at a

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  1  minimum, must be conducted in such a manner as to specifically

  2  determine the number of companies within each SIC Industry

  3  Major Group receiving the exemption as of September 1, 2000,

  4  the number of individuals employed by companies within each

  5  SIC Industry Major Group receiving the exemption as of

  6  September 1, 2000, whether the change, if any, in such number

  7  of companies or employees is attributable to the exemption

  8  provided in this paragraph, whether it would be sound public

  9  policy to continue or discontinue the exemption, and the

10  consequences of doing so.

11         d.  Both reports shall be submitted to the President of

12  the Senate, the Speaker of the House of Representatives, the

13  Senate Minority Leader, and the House Minority Leader.

14         (zz)  Internal Revenue Code s. 501(c)(3)

15  organizations.--Also exempt from the tax imposed by this

16  chapter are sales or leases to organizations holding recurrent

17  exemptions from federal income tax under s. 501(c)(3) of the

18  Internal Revenue Code of 1986, as amended.

19

20  Exemptions provided to any entity by this subsection shall not

21  inure to any transaction otherwise taxable under this chapter

22  when payment is made by a representative or employee of such

23  entity by any means, including, but not limited to, cash,

24  check, or credit card even when that representative or

25  employee is subsequently reimbursed by such entity.

26         Section 7.  Effective January 1, 2000, subsections (2)

27  and (13) of section 212.12, Florida Statutes, 1998 Supplement,

28  are amended to read:

29         212.12  Dealer's credit for collecting tax; penalties

30  for noncompliance; powers of Department of Revenue in dealing

31

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  1  with delinquents; brackets applicable to taxable transactions;

  2  records required.--

  3         (2)(a)  When any person, firm, or corporation required

  4  hereunder to make any return or to pay any tax or fee imposed

  5  by this chapter fails to timely file such return or fails to

  6  pay the tax or fee due within the time required hereunder, in

  7  addition to all other penalties provided herein and by the

  8  laws of this state in respect to such taxes or fees, a

  9  specific penalty shall be added to the tax or fee in the

10  amount of 10 percent of any unpaid tax or fee if the failure

11  is for not more than 30 days, with an additional 10 percent of

12  any unpaid tax or fee for each additional 30 days, or fraction

13  thereof, during the time which the failure continues, not to

14  exceed a total penalty of 50 percent, in the aggregate, of any

15  unpaid tax or fee.  In no event may the penalty be less than

16  $10 for failure to timely file a tax return required by s.

17  212.11(1)(b) or $5 for failure to timely file a tax return

18  authorized by s. 212.11(1)(c) or (d).

19         (b)  Any person who knowingly and with a willful intent

20  to evade any tax imposed under this chapter fails to file six

21  consecutive returns as required by law commits a felony of the

22  third degree, punishable as provided in s. 775.082 or s.

23  775.083.

24         (c)  Any person who makes a false or fraudulent return

25  with a willful intent to evade payment of any tax or fee

26  imposed under this chapter is, in addition to the other

27  penalties provided by law, liable for a specific penalty of

28  100 percent of the tax bill or fee and for fine and punishment

29  as provided in s. 775.082, s. 775.083, or s. 775.084.

30         1.  If the total amount of unreported taxes or fees is

31  less than $300, the first offense is a misdemeanor of the

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  1  second degree, the second offense is a misdemeanor of the

  2  first degree, and the third and each subsequent offense is a

  3  felony of the third degree.

  4         2.  If the total amount of unreported taxes or fees is

  5  at least $300 but less than $20,000, the offense is a felony

  6  of the third degree.

  7         3.  If the total amount of unreported taxes or fees is

  8  at least $20,000 but less than $100,000, the offense is a

  9  felony of the second degree.

10         4.  If the total amount of unreported taxes or fees is

11  $100,000 or more, the offense is a felony of the first degree.

12  In the case of a false or fraudulent return or a willful

13  intent to evade payment of any tax or fee imposed under this

14  chapter, in addition to the other penalties provided by law,

15  the person making such false or fraudulent return or willfully

16  attempting to evade the payment of such a tax or fee shall be

17  liable for a specific penalty of 100 percent of the tax bill

18  or fee and for fine and punishment as provided by law for a

19  conviction of a misdemeanor of the first degree.

20         (d)(b)  When any person, firm, or corporation fails to

21  timely remit the proper estimated payment required under s.

22  212.11, a specific penalty shall be added in an amount equal

23  to 10 percent of any unpaid estimated tax. Beginning with

24  January 1, 1985, returns, The department, upon a showing of

25  reasonable cause, is authorized to waive or compromise

26  penalties imposed by this paragraph. However, other penalties

27  and interest shall be due and payable if the return on which

28  the estimated payment was due was not timely or properly

29  filed.

30         (e)(c)  Dealers filing a consolidated return pursuant

31  to s. 212.11(1)(e) s. 212.11(1)(d) shall be subject to the

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  1  penalty established in paragraph (b) unless the dealer has

  2  paid the required estimated tax for his or her consolidated

  3  return as a whole without regard to each location.  If the

  4  dealer fails to pay the required estimated tax for his or her

  5  consolidated return as a whole, each filing location shall

  6  stand on its own with respect to calculating penalties

  7  pursuant to paragraph (b).

  8         (13)  In order to aid the administration and

  9  enforcement of the provisions of this chapter with respect to

10  the rentals and license fees, each lessor or person granting

11  the use of any hotel, apartment house, roominghouse, tourist

12  or trailer camp, real property, or any interest therein, or

13  any portion thereof, inclusive of owners; property managers;

14  lessors; landlords; hotel, apartment house, and roominghouse

15  operators; and all licensed real estate agents within the

16  state leasing, granting the use of, or renting such property,

17  shall be required to keep a record of each and every such

18  lease, license, or rental transaction which is taxable under

19  this chapter, in such a manner and upon such forms as the

20  department may prescribe, and to report such transaction to

21  the department or its designated agents, and to maintain such

22  records as long as required by s. 213.35, subject to the

23  inspection of the department and its agents.  Upon the failure

24  by such owner; property manager; lessor; landlord; hotel,

25  apartment house, roominghouse, tourist or trailer camp

26  operator; or real estate agent to keep and maintain such

27  records and to make such reports upon the forms and in the

28  manner prescribed, such owner; property manager; lessor;

29  landlord; hotel, apartment house, roominghouse, tourist or

30  trailer camp operator; receiver of rent or license fees; or

31  real estate agent is guilty of a misdemeanor of the second

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  1  degree, punishable as provided in s. 775.082 or s. 775.083,

  2  for the first offense; for subsequent offenses, they are each

  3  guilty of a misdemeanor of the first degree, punishable as

  4  provided in s. 775.082 or s. 775.083. However, any subsequent

  5  offense that involves intentional destruction of such records

  6  with intent to evade payment of or deprive the state of any

  7  tax revenues is a felony of the third degree, punishable as

  8  provided in s. 775.082 or s. 775.083.

  9         Section 8.  Effective January 1, 2000, subsection (1)

10  and (2) of section 212.13, Florida Statutes, are amended to

11  read:

12         212.13  Records required to be kept; power to inspect;

13  audit procedure.--

14         (1)  For the purpose of enforcing the collection of the

15  tax levied by this chapter, the department is hereby

16  specifically authorized and empowered to examine at all

17  reasonable hours the books, records, and other documents of

18  all transportation companies, agencies, or firms that conduct

19  their business by truck, rail, water, aircraft, or otherwise,

20  in order to determine what dealers, or other persons charged

21  with the duty to report or pay a tax under this chapter, are

22  importing or are otherwise shipping in articles or tangible

23  personal property which are liable for said tax.  In the event

24  said transportation company, agency, or firm refuses to permit

25  such examination of its books, records, or other documents by

26  the department as aforesaid, it is guilty of a misdemeanor of

27  the first degree, punishable as provided in s. 775.082 or s.

28  775.083. However, any subsequent offense that involves

29  intentional destruction of such records with an intent to

30  evade payment of or deprive the state of any tax revenues is a

31  felony of the third degree, punishable as provided in s.

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  1  775.082 or s. 775.083. The department shall have the right to

  2  proceed in any chancery court to seek a mandatory injunction

  3  or other appropriate remedy to enforce its right against the

  4  offender, as granted by this section, to require an

  5  examination of the books and records of such transportation

  6  company or carrier.

  7         (2)  Each dealer, as defined in this chapter, shall

  8  secure, maintain, and keep as long as required by s. 213.35 a

  9  complete record of tangible personal property or services

10  received, used, sold at retail, distributed or stored, leased

11  or rented by said dealer, together with invoices, bills of

12  lading, gross receipts from such sales, and other pertinent

13  records and papers as may be required by the department for

14  the reasonable administration of this chapter; all such

15  records which are located or maintained in this state shall be

16  open for inspection by the department at all reasonable hours

17  at such dealer's store, sales office, general office,

18  warehouse, or place of business located in this state. Any

19  dealer who maintains such books and records at a point outside

20  this state must make such books and records available for

21  inspection by the department where the general records are

22  kept. Any dealer subject to the provisions of this chapter who

23  violates these provisions is guilty of a misdemeanor of the

24  first degree, punishable as provided in s. 775.082 or s.

25  775.083. However, any subsequent offense that involves

26  intentional destruction of such records with an intent to

27  evade payment of or deprive the state of any tax revenues is a

28  felony of the third degree, punishable as provided in s.

29  775.082 or s. 775.083.

30

31

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  1         Section 9.  Effective January 1, 2000, subsection (3)

  2  of section 212.18, Florida Statutes, 1998 Supplement, is

  3  amended to read:

  4         212.18  Administration of law; registration of dealers;

  5  rules.--

  6         (3)(a)  Every person desiring to engage in or conduct

  7  business in this state as a dealer, as defined in this

  8  chapter, or to lease, rent, or let or grant licenses in living

  9  quarters or sleeping or housekeeping accommodations in hotels,

10  apartment houses, roominghouses, or tourist or trailer camps

11  that are subject to tax under s. 212.03, or to lease, rent, or

12  let or grant licenses in real property, as defined in this

13  chapter, and every person who sells or receives anything of

14  value by way of admissions, must file with the department an

15  application for a certificate of registration for each place

16  of business, showing the names of the persons who have

17  interests in such business and their residences, the address

18  of the business, and such other data as the department may

19  reasonably require. However, owners and operators of vending

20  machines or newspaper rack machines are required to obtain

21  only one certificate of registration for each county in which

22  such machines are located. The department, by rule, may

23  authorize a dealer that uses independent sellers to sell its

24  merchandise to remit tax on the retail sales price charged to

25  the ultimate consumer in lieu of having the independent seller

26  register as a dealer and remit the tax. The department may

27  appoint the county tax collector as the department's agent to

28  accept applications for registrations. The application must be

29  made to the department before the person, firm, copartnership,

30  or corporation may engage in such business, and it must be

31  accompanied by a registration fee of $5. However, a

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  1  registration fee is not required to accompany an application

  2  to engage in or conduct business to make mail order sales.

  3         (b)  The department, upon receipt of such application,

  4  will grant to the applicant a separate certificate of

  5  registration for each place of business, which certificate may

  6  be canceled by the department or its designated assistants for

  7  any failure by the certificateholder to comply with any of the

  8  provisions of this chapter. The certificate is not assignable

  9  and is valid only for the person, firm, copartnership, or

10  corporation to which issued. The certificate must be placed in

11  a conspicuous place in the business or businesses for which it

12  is issued and must be displayed at all times. Except as

13  provided in this paragraph, no person shall engage in business

14  as a dealer or in leasing, renting, or letting of or granting

15  licenses in living quarters or sleeping or housekeeping

16  accommodations in hotels, apartment houses, roominghouses,

17  tourist or trailer camps, or real property as hereinbefore

18  defined, nor shall any person sell or receive anything of

19  value by way of admissions, without first having obtained such

20  a certificate or after such certificate has been canceled; no

21  person shall receive any license from any authority within the

22  state to engage in any such business without first having

23  obtained such a certificate or after such certificate has been

24  canceled. The engaging in the business of selling or leasing

25  tangible personal property or services or as a dealer, as

26  defined in this chapter, or the engaging in leasing, renting,

27  or letting of or granting licenses in living quarters or

28  sleeping or housekeeping accommodations in hotels, apartment

29  houses, roominghouses, or tourist or trailer camps that are

30  taxable under this chapter, or real property, or the engaging

31  in the business of selling or receiving anything of value by

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  1  way of admissions, without such certificate first being

  2  obtained or after such certificate has been canceled by the

  3  department, is prohibited. The failure or refusal of any

  4  person, firm, copartnership, or corporation to so qualify when

  5  required hereunder is a misdemeanor of the first degree,

  6  punishable as provided in s. 775.082 or s. 775.083, or subject

  7  to injunctive proceedings as provided by law. Such failure or

  8  refusal also subjects the offender to a $100 initial

  9  registration fee in lieu of the $5 registration fee authorized

10  in this paragraph (a).  However, the department may waive the

11  increase in the registration fee if it is determined by the

12  department that the failure to register was due to reasonable

13  cause and not to willful negligence, willful neglect, or

14  fraud.

15         (c)  In addition to the certificate of registration,

16  the department shall provide to each newly registered dealer

17  an initial resale certificate that is valid for the remainder

18  of the period of issuance. The department shall provide each

19  active dealer with an annual resale certificate. As used in

20  this section, the term "active dealer" means a person who is

21  currently registered with the department and who complies with

22  the requirement to file at least once during each applicable

23  reporting period.

24         (d)(b)  The department may revoke any dealer's

25  certificate of registration when the dealer fails to comply

26  with this chapter. Prior to revocation of a dealer's

27  certificate of registration, the department must schedule an

28  informal conference at which the dealer may present evidence

29  regarding the department's intended revocation or enter into a

30  compliance agreement with the department. The department must

31  notify the dealer of its intended action and the time, place,

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  1  and date of the scheduled informal conference by written

  2  notification sent by United States mail to the dealer's last

  3  known address of record furnished by the dealer on a form

  4  prescribed by the department. The dealer is required to attend

  5  the informal conference and present evidence refuting the

  6  department's intended revocation or enter into a compliance

  7  agreement with the department which resolves the dealer's

  8  failure to comply with this chapter. The department shall

  9  issue an administrative complaint under s. 120.60 if the

10  dealer fails to attend the department's informal conference,

11  fails to enter into a compliance agreement with the department

12  resolving the dealer's noncompliance with this chapter, or

13  fails to comply with the executed compliance agreement.

14         (e)(c)  As used in this paragraph, the term "exhibitor"

15  means a person who enters into an agreement authorizing the

16  display of tangible personal property or services at a

17  convention or a trade show.  The following provisions apply to

18  the registration of exhibitors as dealers under this chapter:

19         1.  An exhibitor whose agreement prohibits the sale of

20  tangible personal property or services subject to the tax

21  imposed in this chapter is not required to register as a

22  dealer.

23         2.  An exhibitor whose agreement provides for the sale

24  at wholesale only of tangible personal property or services

25  subject to the tax imposed in this chapter must obtain a

26  resale certificate from the purchasing dealer but is not

27  required to register as a dealer.

28         3.  An exhibitor whose agreement authorizes the retail

29  sale of tangible personal property or services subject to the

30  tax imposed in this chapter must register as a dealer and

31  collect the tax imposed under this chapter on such sales.

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  1         4.  Any exhibitor who makes a mail order sale pursuant

  2  to s. 212.0596 must register as a dealer.

  3

  4  Any person who conducts a convention or a trade show must make

  5  their exhibitor's agreements available to the department for

  6  inspection and copying.

  7         Section 10.  Effective January 1, 2000, subsection (10)

  8  of section 213.053, Florida Statutes, 1998 Supplement, is

  9  amended to read:

10         213.053  Confidentiality and information sharing.--

11         (10)  Notwithstanding any other provision of this

12  section, with respect to a request for verification of a

13  certificate of registration issued pursuant to s. 212.18 to a

14  specified dealer or taxpayer or with respect to a request by a

15  law enforcement officer for verification of a certificate of

16  registration issued pursuant to s. 538.09 to a specified

17  secondhand dealer or pursuant to s. 538.25 to a specified

18  secondary metals recycler, the department may disclose whether

19  the specified person holds a valid certificate or whether a

20  specified certificate number is valid, canceled, inactive, or

21  invalid and the name of the holder of the such certificate.

22  This subsection shall not be construed to create a duty to

23  request verification of any certificate of registration.

24         Section 11.  Subsection (8) is added to section 213.27,

25  Florida Statutes, to read:

26         213.27  Contracts with debt collection agencies.--

27         (8)(a)  The executive director of the department may

28  enter into contracts with private vendors to develop and

29  implement systems for enhancing tax collections. The vendor's

30  compensation under such a contract must be funded through

31  increased tax collections. The amount of the compensation paid

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  1  to a vendor must be a percentage of the increase in the amount

  2  of tax collected which is attributable to the system, after

  3  all administrative and judicial appeals are exhausted, and the

  4  total amount of compensation paid to a vendor may not exceed

  5  the maximum amount stated in the contract.

  6         (b)  A person acting on behalf of the department under

  7  a contract authorized by this section does not exercise any of

  8  the powers of the department, except that the person is an

  9  agent of the department for the purposes of developing and

10  implementing a system for enhancing tax collections.

11         (c)  Disclosure of information under this subsection

12  must be governed by a written agreement between the executive

13  director and the private vendor. The vendor is bound by the

14  confidentiality requirements that apply to the Department of

15  Revenue. Breach of confidentiality is a misdemeanor of the

16  first degree, punishable as provided in s. 775.082 or s.

17  775.083.

18         Section 12.  Subsection (1) of section 213.67, Florida

19  Statutes, 1998 Supplement, is amended to read:

20         213.67  Garnishment.--

21         (1)  If a person is delinquent in the payment of any

22  taxes, penalties, and interest owed to the department, the

23  executive director or his or her designee may give notice of

24  the amount of such delinquency by registered mail to all

25  persons having in their possession or under their control any

26  credits or personal property, exclusive of wages, belonging to

27  the delinquent taxpayer, or owing any debts to such delinquent

28  taxpayer at the time of receipt by them of such notice.

29  Thereafter, any person who has been notified may not transfer

30  or make any other disposition of such credits, other personal

31  property, or debts until the executive director or his or her

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  1  designee consents to a transfer or disposition or until 60

  2  days after the receipt of such notice, except that the amount

  3  by which the value of the credits, other personal property, or

  4  debts, wherever held, exceeds the delinquent amount stipulated

  5  in the notice is exempt from this section if the dealer does

  6  not have a prior history of tax delinquencies. If during the

  7  effective period of the notice to withhold, any person so

  8  notified makes any transfer or disposition of the property or

  9  debts required to be withheld hereunder, he or she is liable

10  to the state for any indebtedness owed to the department by

11  the person with respect to whose obligation the notice was

12  given to the extent of the value of the property or the amount

13  of the debts thus transferred or paid if, solely by reason of

14  such transfer or disposition, the state is unable to recover

15  the indebtedness of the person with respect to whose

16  obligation the notice was given. If the delinquent taxpayer

17  contests the intended levy in circuit court or under chapter

18  120, the notice under this section remains effective until

19  that final resolution of the contest. Any financial

20  institution receiving such notice will maintain a right of

21  setoff for any transaction involving a debit card occurring on

22  or before the date of receipt of such notice.

23         Section 13.  Effective January 1, 2000, section

24  213.757, Florida Statutes, is created to read:

25         213.757  Willful failure to pay over funds or

26  destruction of records by agent.--Any person who accepts from

27  a taxpayer money that is due to the department, for the

28  purpose of acting as the taxpayer's agent to make the payment

29  to the department, but who willfully fails to remit the

30  payment to the department when due, commits a felony of the

31  third degree, punishable as provided in s. 775.082, s.

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  1  775.083, or s. 775.084. Any person who has possession as a

  2  taxpayer's agent of the taxpayer's records that are required

  3  to be maintained under the revenue laws of this state and who

  4  intentionally destroys those records with the intent of

  5  depriving the state of tax revenues commits a felony of the

  6  third degree, punishable as provided in s. 775.082, s.

  7  775.083, or s. 775.084.

  8         Section 14.  Paragraph (b) of subsection (1) of section

  9  220.151, Florida Statutes, is amended to read:

10         220.151  Apportionment; methods for special

11  industries.--

12         (1)

13         (b)  If the principal source of premiums written by an

14  insurance company consists of premiums for reinsurance

15  accepted by it, the tax base of such company shall be

16  apportioned to this state by multiplying such base by a

17  fraction the numerator of which is the sum of:

18         1.  Direct premiums written for insurance upon

19  properties and risks in this state, plus

20         2.  Premiums written for reinsurance, accepted in

21  respect to properties and risks in this state,

22

23  and the denominator of which is the sum of direct premiums

24  written for insurance upon properties and risks everywhere

25  plus premiums written for reinsurance accepted in respect to

26  properties and risks everywhere.  For purposes of this

27  paragraph, premiums written for reinsurance accepted in

28  respect to properties and risks in this state, whether or not

29  otherwise determinable, shall may, at the election of the

30  company, either be determined on the basis of the proportion

31  which premiums written for reinsurance accepted from companies

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  1  resident in or having a regional home office in the state

  2  bears to premiums written for reinsurance accepted from all

  3  sources or, alternatively, on the basis of the proportion

  4  which the sum of the direct premiums written for insurance

  5  upon properties and risks in this state by each ceding company

  6  from which reinsurance is accepted bears to the sum of the

  7  total direct premiums written by each such ceding company for

  8  the taxable year.

  9         Section 15.  Section 220.21, Florida Statutes, is

10  amended to read:

11         220.21  Returns and records; regulations.--Every

12  taxpayer liable for the tax imposed by this code shall keep

13  such records, render such statements, make such returns and

14  notices, and comply with such rules and regulations, as the

15  department may from time to time prescribe.  The director may

16  require any taxpayer or class of taxpayers, by notice or by

17  regulation, to make such returns and notices, render such

18  statements, and keep such records as the director deems

19  necessary to determine whether such taxpayer or taxpayers are

20  liable for tax under this code. The department may prescribe

21  standards for acceptance of electronic or telephonic returns;

22  however, national standards for taxpayer authentication must

23  be used in lieu of signature.

24         Section 16.  Subsection (3) of section 220.221, Florida

25  Statutes, is amended to read:

26         220.221  Returns; signing and verification.--

27         (3)  Each return or notice required to be filed under

28  this code shall be verified by a written declaration that it

29  is made under the penalties of perjury, and if prepared by

30  someone other than the taxpayer the return shall also contain

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  1  a declaration by the preparer that it was prepared on the

  2  basis of all information of which the preparer had knowledge.

  3         Section 17.  Paragraphs (a) and (b) of subsection (2)

  4  of section 220.222, Florida Statutes, 1998 Supplement, are

  5  amended to read:

  6         220.222  Returns; time and place for filing.--

  7         (2)(a)  When a taxpayer has been granted an extension

  8  or extensions of time within which to file its federal income

  9  tax return for any taxable year, and if the requirements of s.

10  220.32 are met, the filing of a written request for such

11  extension or extensions with the department shall

12  automatically extend the due date of the return required under

13  this code until 15 days after the expiration of the federal

14  extension or until the expiration of 6 months from the

15  original due date, whichever first occurs.

16         (b)  The department may grant an extension or

17  extensions of time for the filing of any return required under

18  this code upon receiving a prior written request therefor if

19  good cause for an extension is shown.  However, the aggregate

20  extensions of time under paragraphs (a) and (b) shall not

21  exceed 6 months. No extension granted under this paragraph

22  shall be valid unless the taxpayer complies with the

23  requirements of s. 220.32.

24         Section 18.  Effective January 1, 2000, the Department

25  of Revenue shall establish a toll-free number for the

26  verification of valid registration numbers and resale

27  certificates. The system must be adequate to guarantee a low

28  busy rate, must respond to keypad inquiries, and must provide

29  data that is updated daily.

30         Section 19.  The Department of Revenue shall establish

31  a system, effective January 1, 2000, for receiving information

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  1  from dealers regarding certificate numbers of those who are

  2  seeking to make purchases for resale. The department must

  3  provide such dealers, free of charge, with verification of

  4  those numbers that are canceled or invalid.

  5         Section 20.  Effective July 1, 1999, the Department of

  6  Revenue shall expand its dealer education program regarding

  7  the proper use of resale certificates. The expansion must

  8  include, but need not be limited to, revision of the

  9  registration application for clarity, development of

10  industry-specific brochures, development of a media campaign

11  to heighten awareness of resale fraud and its consequences,

12  outreach to business and professional organizations, and

13  creation of seminars and continuing-education programs for

14  taxpayers and licensed professionals.

15         Section 21.  (1)  There is appropriated from the

16  General Revenue Fund to the Department of Revenue in fiscal

17  year 1999-2000, to be used in implementing the changes to the

18  resale certificate and related provisions of this act:

19         (2)  One and one-half full-time-equivalent positions

20  and the sum of $211,065 to be used for salaries, benefits, and

21  expenses; and

22         (3)  The sum of $23,455 to be used for operating

23  capital outlay.

24         Section 22.  Except as otherwise expressly provided in

25  this act, this act shall take effect July 1, 1999.

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  1            *****************************************

  2                          SENATE SUMMARY

  3    Amends provisions relating to tax administration. Grants
      credits against the intangibles tax and against the
  4    documentary stamp tax for an identical tax paid in
      another state. Amends the definition of the term "retail
  5    sale" with respect to materials that are incorporated
      into repaired motor vehicles, airplanes, or boats.
  6    Increases the criminal penalties for willful violations
      of certain tax provisions. Provides for the annual
  7    issuance of resale certificates to active accounts.
      Authorizes the Department of Revenue to disclose to a
  8    dealer or taxpayer whether a specified certificate is
      active, canceled, inactive, or invalid. Amends the
  9    exemption for electricity and steam used for
      manufacturing. Provides an exemption for sales or leases
10    to organizations holding current exemption from federal
      income tax under s. 501(c)(3) of the Internal Revenue
11    Code. Authorizes the Department of Revenue to enter into
      contracts with private vendors to develop an automated
12    case-tracking system. Authorizes the Department of
      Revenue to reduce the amount of an administrative
13    garnishment which is subject to a freeze to the amount
      equal to the delinquent amount. Authorizes the Department
14    of Revenue to accept electronic or telephonic corporate
      income tax returns in lieu of written paper returns.
15    Directs the Department of Revenue to establish a
      toll-free number for the verification of valid
16    registration numbers and resale certificates. Directs the
      Department of Revenue to establish a system for receiving
17    information from dealers regarding certificate numbers.
      Directs the Department of Revenue to expand its dealer
18    education program regarding the proper use of resale
      certificates. Provides appropriations.
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