…
There is no question that Taxpayer
entered into retail transactions for which – absent an exemption – Taxpayer was
required to collect sales tax. Taxpayer has somewhat belatedly supplied
exemption certificates from its customers for certain of its sales. The audit
division is requested to review the late-filed exemption certificates and to
make whatever adjustments it deems appropriate. However, Taxpayer is reminded
that sales tax becomes due at the time of the transaction; either the purchaser
is exempt at the time of the transaction or it is not exempt. If the purchaser
claims an exemption, the exemption certificate should be obtained at the time
the transaction occurs otherwise the burden of proving the transaction was
exempt becomes measurably more difficult.
…
Initially, the Department found that
Taxpayer had recorded a $12,123 (audit report p.20) retail transaction in its
books and records for which Taxpayer had failed to pay sales tax at the time of
the transaction or remit use tax to the Department. Taxpayer asserts this adjustment
in its books and records represents an "accounting adjustment" and
not a transaction that is subject to sales and use tax.
…
During the protest, Taxpayer
presented additional documentation to support its assertions. Taxpayer has
provided sufficient documentation to establish the $12,123 "accounting
adjustment" was not a retail transaction, and, therefore, should not be
subjected to sales and use tax.
