House Bill 374

AN ACT TO AMEND SECTION 27-65-31, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT IF A DEALER IN FARM TRACTORS OR FARM IMPLEMENTS REQUIRES A PERSON WHO STATES HE IS ELIGIBLE FOR THE REDUCED SALES TAX RATE AUTHORIZED FOR SALES OF SUCH EQUIPMENT TO FARMERS TO SIGN AN AFFIDAVIT STATING THAT THE PERSON IS ELIGIBLE FOR SUCH REDUCED RATE, THE DEALER SHALL NOT BE LIABLE FOR ADDITIONAL SALES TAXES DUE IF THE PERSON WHO SIGNED THE AFFIDAVIT IS LATER DETERMINED NOT TO BE ELIGIBLE FOR THE REDUCED RATE; TO PROVIDE THAT THE PERSON WHO SIGNED THE AFFIDAVIT SHALL BE LIABLE FOR ANY ADDITIONAL SALES TAX DUE ON THE PURCHASE; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 27-65-31, Mississippi Code of 1972, is amended as follows:

27-65-31. (1) Except as otherwise provided in subsection (9) of this section, any person liable for a privilege tax levied and assessed by this chapter except the taxes levied by Sections 27-65-15, 27-65-17(3) and 27-65-21, Mississippi Code of 1972, shall add the amount of such tax due by him to the sales price or gross income and, in addition thereto, shall collect, insofar as practicable, the amount of the tax due by him from the purchaser at the time the sales price or gross income is collected.

(2) The commissioner is authorized, in his discretion, to prescribe by rule or regulation, brackets or schedules by which the applicable tax shall be collected from the purchaser.

(3) The commissioner shall have the authority to make changes as necessary by rule or regulation to implement an agreement for the collection of sales tax by direct marketers with limited contact in Mississippi if, in his discretion, it is beneficial to the state for him to do so.

(4) Except as otherwise provided in subsection (9) of this section, it shall be unlawful for any person, who is liable for a privilege tax levied by this chapter except the taxes levied by Sections 27-65-15, 27-65-17(3) and 27-65-21, Mississippi Code of 1972, to fail or refuse to add to the sales price and collect, insofar as practicable, the amount of tax due by him on each sale, except where the tax was included in the cost of furnishing service when said cost was a factor in the fixing of rates and charges.

(5) The tax due under the provisions of this chapter shall be computed and paid on gross income or gross proceeds of sales of the business, regardless of the fact that small unit sales may be within the bracket of one (1) of the schedules which does not provide for the collection of the tax from the customer.

(6) Nothing in this section with reference to the collection of the tax from the customer shall be construed to impair, abridge, alter or affect the obligation of any contract in existence at the time it becomes effective.

(7) When the tax collected for any filing period is in excess of the amount due, the total tax collected, including that in excess of the computed liability, shall be paid to the commissioner. This provision shall be construed with other provisions of the law and given effect so as to result in the payment to the commissioner of the total tax collected if in excess of the amount due when computed at the applicable rates.

(8) The funds collected by the taxpayer (seller) from the purchaser pursuant to the provisions of this chapter shall be considered "trust fund monies" and the taxpayer shall hold these funds in trust for the State of Mississippi; said funds to be separately accounted for as provided by regulation of the commissioner. If the taxpayer fails to remit these trust fund monies as required by law, then the taxpayer may be assessed with a penalty in three (3) times the amount of taxes due. This penalty is to be assessed and collected in the same manner as taxes imposed by this chapter and shall be in addition to all other penalties and/or interest otherwise imposed. For purposes of this section there shall be a presumption that the taxpayer collected the tax from the customer or purchaser.

(9) If a person states that the reduced sales tax rate on farm tractors or farm implements for farmers provided for in Section 27-65-17 applies to a purchase the person is making, and a dealer of farm tractors or farm implements requires the person to execute an affidavit stating that such person is a farmer and the purchase is otherwise eligible for the reduced sales tax rate:

(a) The dealer shall not be liable for additional sales taxes due on the purchase of a farm tractor or farm implements if it is later determined that the person was not eligible for the reduced sales tax rate; and

(b) The person who signed the affidavit shall be liable for the additional sales tax due.

(10) Any person violating the provisions of this section shall be guilty of a misdemeanor and, upon conviction, shall be fined in a sum not less than Fifty Dollars ($50.00) nor more than One Hundred Dollars ($100.00).

SECTION 2. This act shall take effect and be in force from and after July 1, 2005.