House Bill 1076

AN ACT TO AMEND SECTION 27-65-37, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT IF AN AUDIT BY THE DEPARTMENT OF REVENUE INDICATES THAT A TAXPAYER HAS MADE AN UNDERPAYMENT OF SALES TAX AND OWES ADDITIONAL TAXES, THE TAXPAYER WILL NOT BE LIABLE FOR ADDITIONAL TAXES DETERMINED TO BE OWED BEFORE THE DATE OF SUCH AUDIT IF TWO SUCCESSIVE DEPARTMENT OF REVENUE AUDITS IMMEDIATELY PRECEDING SUCH AUDIT DETERMINED THE TAXPAYER TO BE PROPERLY COLLECTING SALES TAX, THE PRACTICES OR CIRCUMSTANCES THAT INDICATE THE TAXPAYER IS LIABLE FOR ADDITIONAL TAXES IN THE CURRENT AUDIT ARE THE SAME PRACTICES OR CIRCUMSTANCES DETERMINED TO BE PROPER IN THE PREVIOUS AUDITS AND THE STATUTES PROVIDING THE TAXPAYER'S LIABILITY TO COLLECT SALES TAX WERE NOT CHANGED SINCE THE MOST RECENT PREVIOUS AUDIT IN SUCH A MANNER AS TO MAKE THE TAXPAYER LIABLE FOR THE ADDITIONAL TAX; AND FOR RELATED PURPOSES.

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

SECTION 1. Section 27-65-37, Mississippi Code of 1972, is amended as follows:

27-65-37. If adequate records of the gross income or gross proceeds of sales are not maintained or invoices preserved as provided herein, or if an audit of the records of a taxpayer, or any return filed by him, or any other information discloses that taxes are due and unpaid, the commissioner shall make assessments of taxes, damages, and interest from any information available, which shall be prima facie correct. However, if an audit of the records of a taxpayer indicates that the taxpayer has made an underpayment of taxes and owes additional taxes, the taxpayer shall not be liable for additional taxes determined to be owed before the date of such audit if: (a) the taxpayer was audited by the department on two (2) successive occasions immediately preceding the audit that indicates the taxpayer owes additional taxes and the previous audits determined the taxpayer to be collecting taxes in compliance with this chapter, (b) the practices or circumstances that indicate the taxpayer is liable for additional taxes in the current audit are the same practices or circumstances determined to be in compliance with this chapter in the previous audits, and (c) the statutes providing the taxpayer's liability to collect the tax were not changed since the most recent previous audit in such a manner as to make the taxpayer liable for the additional tax. The commissioner shall give notice to the taxpayer of such assessments and demand payment of the tax, damages and interest within sixty (60) days from the date of the notice. The notice shall be sent by regular mail or delivered by an agent of the commissioner either to the taxpayer or someone of suitable age and discretion at the taxpayer's residence or place of business.

If the taxpayer shall fail or refuse to comply with the notice of assessment or shall fail to petition for a hearing, the commissioner shall proceed as provided in Section 27-65-39.

SECTION 2. This act shall take effect and be in force from and after July 1, 2013.