Senate Bill sb0018A

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    Florida Senate - 2003                                  SB 18-A

    By Senator Campbell





    32-2569B-03

  1                      A bill to be entitled

  2         An act relating to taxation; directing the

  3         Department of Revenue to develop and implement

  4         an amnesty program for taxpayers subject to the

  5         state and local taxes imposed by chapters 125,

  6         198, 199, 201, 202, 203, 206, 211, 212, 220,

  7         221, 336, 370, 376, 403, 538, 624, 627, and

  8         681, F.S.; providing time periods; providing

  9         program guidelines; providing for eligible

10         participants; providing for waiver of penalties

11         and interest under specified circumstances;

12         providing for emergency rules; amending ss.

13         213.235, 220.807, F.S.; providing that the

14         interest rate on certain tax deficiencies shall

15         be an adjusted prime rate plus 4 percentage

16         points; providing a maximum rate; providing

17         legislative intent; providing an appropriation;

18         amending s. 202.35, F.S.; providing a maximum

19         interest rate on delinquent taxes; amending s.

20         626.932, F.S.; changing the distribution of the

21         surplus lines tax; amending s. 626.938, F.S.;

22         changing the distribution of the tax on

23         independently procured coverages; providing for

24         construction of the act in pari materia with

25         laws enacted during the Regular Session of the

26         Legislature; providing effective dates.

27  

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

29  

30         Section 1.  (1)  No later than July 1, 2003, the

31  Department of Revenue shall develop and implement an amnesty

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    Florida Senate - 2003                                  SB 18-A
    32-2569B-03




 1  program for taxpayers subject to the state and local taxes

 2  imposed by chapters 125, 198, 199, 201, 202, 203, 206, 211,

 3  212, 220, 221, 336, 370, 376, 403, 538, 624, 627, and 681,

 4  Florida Statutes.

 5         (2)  The amnesty program shall be a one-time

 6  opportunity for eligible taxpayers to satisfy their tax

 7  liabilities under the revenue laws of this state and thereby

 8  avoid criminal prosecution, penalties, and interest as

 9  provided in subsections (4), (5), and (6). Any taxpayer that

10  has entered into a settlement of liability for state or local

11  option taxes before July 1, 2003, whether or not full and

12  complete payment has been made of the settlement amount, shall

13  not be eligible to participate in the amnesty program.

14         (3)  The amnesty program shall be in effect for a

15  4-month period beginning on July 1, 2003, and ending on

16  October 31, 2003. The amnesty program shall apply only to tax

17  liabilities due prior to July 1, 2003.  In order to

18  participate in the amnesty program, eligible taxpayers must

19  file the forms and other documentation specified by the

20  Department of Revenue, including, but not limited to, returns

21  and amended returns, must make full payment of tax due, and

22  must make payment of the interest due as provided in

23  subsections (4) and (5).

24         (4)  A taxpayer may participate in the amnesty program

25  whether or not the taxpayer is under audit, inquiry,

26  examination, or civil investigation initiated by the

27  Department of Revenue, regardless of whether the amount due is

28  included in a proposed assessment or an assessment, bill,

29  notice, or demand for payment issued by the Department of

30  Revenue, and without regard to whether the amount due is

31  subject to a pending administrative or judicial

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    Florida Senate - 2003                                  SB 18-A
    32-2569B-03




 1  proceeding.  If any of the circumstances set forth in this

 2  subsection apply, the taxpayer shall be required to pay the

 3  full amount of the tax due and 75 percent of the amount of

 4  interest due. When the department has issued a notice of

 5  intent to conduct an audit to a taxpayer but has not commenced

 6  the audit, the taxpayer may apply to the department during the

 7  amnesty program for approval to have the audit converted to

 8  the certified audits program authorized by section 213.285,

 9  Florida Statutes. When a taxpayer has been approved during the

10  amnesty program to have an audit converted to the certified

11  audits program, payment of any liability determined as a

12  result of this participation in the certified audits program

13  must be made during the period the amnesty program is in

14  effect. A taxpayer that is participating in the certified

15  audits program authorized by section 213.285, Florida

16  Statutes, shall be eligible for the interest and penalty

17  compromises authorized by either the amnesty program or the

18  certified audits program, but not both.

19         (5)  If the circumstances set forth in subsection (4)

20  do not apply and the initial contact with the Department of

21  Revenue is made by the taxpayer pursuant to the amnesty

22  program, the taxpayer shall be required to pay the full amount

23  of the tax due and 50 percent of the amount of interest due.

24         (6)  No penalties shall be imposed on any tax paid

25  pursuant to the amnesty program, and the Department of Revenue

26  shall not initiate a criminal investigation against or refer

27  for prosecution any taxpayer participating in the amnesty

28  program with respect to the failure to timely pay the tax

29  disclosed in the amnesty program.

30         (7)  Participation in the amnesty program shall be

31  conditioned upon the taxpayer's express waiver of rights to

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    Florida Senate - 2003                                  SB 18-A
    32-2569B-03




 1  contest taxes being reported pursuant to the amnesty program.

 2  If the taxes reported pursuant to the amnesty program are the

 3  subject of a pending informal protest under section 213.21,

 4  Florida Statutes, or of administrative or judicial proceedings

 5  that have not become final as of the date payment of the taxes

 6  is made pursuant to the amnesty program, participation in the

 7  amnesty program is conditioned upon the taxpayer's withdrawal

 8  of such informal protest or dismissal of such administrative

 9  or judicial proceeding.  Participation in the amnesty program

10  shall also be conditioned upon the taxpayer's express

11  agreement to waive any right to claim a refund or to protest

12  or initiate an administrative or judicial proceeding to review

13  any denial of a refund claim for any refund of tax or interest

14  paid under the amnesty program except as provided in this

15  subsection. No refund may be made of any penalty or interest

16  paid prior to July 1, 2003.  Any credit or refund of tax or

17  interest paid as a result of participation in the amnesty

18  program shall be strictly limited to amounts determined by the

19  Department of Revenue to have been paid in error.

20         (8)  A taxpayer under criminal investigation,

21  indictment, information, or prosecution regarding a revenue

22  law of this state shall not be eligible to participate in the

23  amnesty program. A taxpayer that has been convicted of a crime

24  regarding a revenue law of this state shall not be eligible to

25  participate in the amnesty program.

26         (9)  With or without an audit, the Department of

27  Revenue is authorized to issue a notice or demand for payment

28  with respect to any tax or interest that it determines to be

29  due with any return filed under the tax amnesty program, and

30  such notice and demand shall be prima facie correct in any

31  administrative, judicial, or quasi-judicial proceeding.

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    Florida Senate - 2003                                  SB 18-A
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 1         (10)  The Department of Revenue may, on the basis of

 2  fraud, misrepresentation, or mutual mistake of fact, rescind a

 3  grant of amnesty, including any amnesty granted as a result of

 4  participation in the certified audit program during the period

 5  the amnesty program is in effect. Any taxpayer that files

 6  under the amnesty program false or fraudulent returns, forms,

 7  or documentation or attempts in any manner to defeat or evade

 8  a tax is subject to applicable penalties and criminal

 9  prosecution.

10         (11)  Any local option tax administered by a local

11  government that imposed the tax pursuant to a statute

12  permitting self-administration is excluded from the amnesty

13  program unless the local government notifies the Department of

14  Revenue by June 1, 2003, that it chooses to participate in the

15  amnesty program.

16         (12)  The executive director of the Department of

17  Revenue is authorized to adopt emergency rules under sections

18  120.536(1) and 120.54(4), Florida Statutes, to implement the

19  amnesty program. Such rules may provide forms, procedures,

20  terms, conditions, and methods of payment appropriate for fair

21  and effective administration of the amnesty program and to

22  ensure the taxpayer's ongoing commitment to proper remittance

23  of taxes to the state. Notwithstanding any other law, the

24  emergency rules shall remain in effect until the later of the

25  date that is 6 months after the date of adoption of the rule

26  or the date of final resolution of all amnesty applications

27  filed pursuant to this section.

28         Section 2.  Effective November 1, 2003, subsections (2)

29  and (3) of section 213.235, Florida Statutes, are amended to

30  read:

31         213.235  Determination of interest on deficiencies.--

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    Florida Senate - 2003                                  SB 18-A
    32-2569B-03




 1         (2)  If the adjusted prime rate charged by banks,

 2  rounded to the nearest full percent, plus 4 percentage points,

 3  during either:

 4         (a)  The 6-month period ending on September 30 of any

 5  calendar year, or

 6         (b)  The 6-month period ending on March 31 of any

 7  calendar year

 8  

 9  differs from the interest rate in effect on either such date,

10  the executive director of the department shall, within 20

11  days, establish an adjusted rate of interest equal to such

12  adjusted prime rate plus 4 percentage points.

13         (3)  An adjusted rate of interest established under

14  this section becomes effective:

15         (a)  On January 1 of the succeeding year, if based upon

16  the adjusted prime rate plus 4 percentage points for the

17  6-month period ending on September 30; or

18         (b)  On July 1 of the same calendar year, if based upon

19  the adjusted prime rate plus 4 percentage points for the

20  6-month period ending on March 31.

21         Section 3.  Amendments made by this act to section

22  213.235(2) and (3), Florida Statutes, apply to interest due on

23  tax payment deficiencies that arise on or after November 1,

24  2003, and also apply to interest due on tax payment

25  deficiencies that arose on or after January 1, 2000, but

26  remain unpaid as of November 1, 2003. When calculating the

27  rate that takes effect on November 1, 2003, the department

28  shall use in making that calculation the adjusted prime rate

29  charged by banks, rounded to the nearest full percent, during

30  the 6-month period ending on March 31, 2003.

31  

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    Florida Senate - 2003                                  SB 18-A
    32-2569B-03




 1         Section 4.  Effective November 1, 2003, subsections

 2  (1), (2), and (3) of section 220.807, Florida Statutes, are

 3  amended to read:

 4         220.807  Determination of rate of interest.--

 5         (1)  The annual rate of interest applicable to this

 6  chapter shall be the adjusted rate established by the

 7  executive director of the Department of Revenue under

 8  subsection (2), except that the annual rate of interest shall

 9  never be greater than 12 percent.

10         (2)  If the adjusted prime rate charged by banks,

11  rounded to the nearest full percent, plus 4 percentage points,

12  during either:

13         (a)  The 6-month period ending on September 30 of any

14  calendar year; or

15         (b)  The 6-month period ending on March 31 of any

16  calendar year,

17  

18  differs from the interest rate in effect on either such date,

19  the executive director of the Department of Revenue shall,

20  within 20 days, establish an adjusted rate of interest equal

21  to such adjusted prime rate plus 4 percentage points.

22         (3)  An adjusted rate of interest established under

23  this section shall become effective:

24         (a)  On January 1 of the succeeding year, if based upon

25  the adjusted prime rate plus 4 percentage points for the

26  6-month period ending on September 30; or

27         (b)  On July 1 of the same calendar year, if based upon

28  the adjusted prime rate plus 4 percentage points for the

29  6-month period ending on March 31.

30         Section 5.  Amendments made by this act to section

31  220.807(1), (2), and (3), Florida Statutes, apply to interest

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    Florida Senate - 2003                                  SB 18-A
    32-2569B-03




 1  due on tax payment deficiencies that arise on or after

 2  November 1, 2003, and also apply to interest due on tax

 3  payment deficiencies that arose before January 1, 2003, but

 4  remain unpaid as of November 1, 2003. When calculating the

 5  rate that takes effect on November 1, 2003, the department

 6  shall use in making that calculation the adjusted prime rate

 7  charged by banks, rounded to the nearest full percent, during

 8  the 6-month period ending on March 31, 2003.

 9         Section 6.  Effective November 1, 2003, subsection (1)

10  of section 202.35, Florida Statutes, is amended to read:

11         202.35  Powers of department in dealing with

12  delinquents; tax to be separately stated.--

13         (1)  If any dealer or other person fails to remit the

14  tax, or any portion thereof, on or before the day when the tax

15  is required by law to be paid, there will be added to the

16  amount due interest at the rate calculated pursuant to s.

17  213.235 of the amount due from the date due until paid, except

18  that the annual rate of interest shall never be greater than

19  12 percent. Interest on the delinquent tax is to be calculated

20  beginning on the 21st day of the month following the month for

21  which the tax is due, except as otherwise provided in this

22  chapter.

23         Section 7.  The sum of $610,000 is appropriated from

24  the General Revenue Fund to the Department of Revenue for the

25  purpose of administering the amnesty program created by this

26  act. Funds remaining unexpended or unencumbered from this

27  appropriation as of June 30, 2003, shall revert and be

28  reappropriated for the same purpose in fiscal year 2003-2004.

29         Section 8.  Subsection (5) of section 626.932, Florida

30  Statutes, is amended to read:

31         626.932  Surplus lines tax.--

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    Florida Senate - 2003                                  SB 18-A
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 1         (5)  The department shall deposit 24.3 55 percent of

 2  all taxes collected under this section to the credit of the

 3  Insurance Commissioner's Regulatory Trust Fund. Seventy-five

 4  and seven-tenths Forty-five percent of all taxes collected

 5  under this section shall be deposited into the General Revenue

 6  Fund.

 7         Section 9.  Subsection (7) of section 626.938, Florida

 8  Statutes, is amended to read:

 9         626.938  Report and tax of independently procured

10  coverages.--

11         (7)  The department shall deposit 24.3 55 percent of

12  all taxes and interest collected under this section to the

13  credit of the Insurance Commissioner's Regulatory Trust Fund.

14  Seventy-five and seven-tenths Forty-five percent of all taxes

15  and interest collected under this section shall be deposited

16  into the General Revenue Fund.

17         Section 10.  If any law that is amended by this act was

18  also amended by a law enacted at the 2003 Regular Session of

19  the Legislature, such laws shall be construed as if they had

20  been enacted during the same session of the Legislature, and

21  full effect should be given to each if that is possible.

22         Section 11.  Except as otherwise specifically provided

23  in this act, this act shall take effect upon becoming a law.

24  

25            *****************************************

26                          SENATE SUMMARY

27    Revises the distribution of revenues between various
      trust funds and the General Revenue Fund. Directs the
28    Department of Revenue to develop and implement an amnesty
      program for delinquent taxpayers. (See bill for details.)
29  

30  

31  

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