No. 27092 (Amendment): R865-21U-1. Nature of Tax Pursuant to Utah Code Ann. Section 59-12-103

DAR File No.: 27092
Filed: 04/14/2004, 11:06
Received by: NL

 

RULE ANALYSIS

Purpose of the rule or reason for the change:

Section 59-12-103 authorizes a state sales and use tax, and various sections throughout the chapter authorize the different local sales and use taxes.

 

Summary of the rule or change:

The proposed amendment indicates when the sales and use tax is a sales tax and when it is a use tax. Although this proposed amendment will change that determination, there will be no impact to the consumer because the rates of the taxes are the same. It will, however, in some instances bear impact on who is responsible for the payment of the tax to the Tax Commission.

 

State statutory or constitutional authorization for this rule:

Section 29-12-103

 

Anticipated cost or savings to:

the state budget:

None--The determination of whether a tax is a sales tax or a use tax has no impact on the amount of revenue collected.

 

local governments:

None--The determination of whether a tax is a sales tax or a use tax has no impact on the amount of revenue collected.

 

other persons:

None--The determination of whether a tax is a sales tax or a use tax has no impact on the amount of revenue collected.

 

Compliance costs for affected persons:

None--The terminology used in referring to the tax has no impact on the amount of revenue collected.

 

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

None--There is no difference to the taxpayer whether the tax is collected is a sales or use tax.

 

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:

Cheryl Lee at the above address, by phone at 801-297-3900, by FAX at 801-297-3919, or by Internet E-mail at [e-mail]

 

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:

06/01/2004

 

This rule may become effective on:

06/02/2004

 

Authorized by:

Pam Hendrickson, Commissioner

 

 

RULE TEXT

R865. Tax Commission, Auditing.

R865-21U. Use Tax.

R865-21U-1. Nature of Use Tax Pursuant to Utah Code Ann. Section 59-12-103.

[A. The use tax is an excise tax on the storage, use, or other consumption of tangible personal property in Utah, the sale of which was not subject to Utah sales tax. The use tax also applies to amounts paid or charged for repair services and renovation services performed on tangible personal property and installation charges in connection with installing tangible personal property to other tangible personal property. The charges for these services are taxable if the property is stored, used, or otherwise consumed in Utah after the services are performed, whether the services are performed outside Utah or if a retailer was called to this state to perform the services.

B. In general, the use tax applies to the purchase of tangible personal property for consumption if the sale or rental of the property or the services performed on the property would have been subject to the sales tax if purchased within the state. The primary purpose of the use tax is to protect the merchants of Utah from discrimination arising from the inability of the state of Utah to impose a sales tax on sales made to residents of this state in interstate commerce or by merchants in other states.]A. The tax imposed on amounts paid or charged for transactions under Title 59, Chapter 12 is a:

1. sales tax, if the tax is collected and remitted by a seller on the seller's in-state or out-of-state sales; or

2. use tax, if the tax is remitted by a purchaser.

B. The two taxes are compensating taxes, one supplementing the other, but both cannot be applicable to the same transaction. The rate of tax is the same.

 

KEY: taxation, user tax

[August 20, 1996]2004

Notice of Continuation March 27, 2001

59-12-103