2019 -- S 0674

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LC002129

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

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A N   A C T

RELATING TO TAXATION -- STATE TAX OFFICIALS -- SALES AND USE TAXES --

ENFORCEMENT AND COLLECTION

     

     Introduced By: Senators Euer, Lawson, Cano, Murray, and Valverde

     Date Introduced: March 21, 2019

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Section 44-1-7 of the General Laws in Chapter 44-1 entitled "State Tax

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Officials" is hereby amended to read as follows:

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     44-1-7. Interest on delinquent payments.

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     (a) Whenever the full amount of any state tax or any portion or deficiency, as finally

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determined by the tax administrator, has not been paid on the date when it is due and payable,

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whether the time has been extended or not, there shall be added as part of the tax or portion or

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deficiency interest at the rate as determined in accordance with subsection (b) of this section,

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notwithstanding any general or specific statute to the contrary.

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     (b) Each January 1 the tax administrator shall compute the rate of interest to be in effect

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for that calendar year by adding two percent (2%) to the prime rate, which was in effect on

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October 1 of the preceding year. In no event shall the rate of interest exceed twenty-one percent

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(21%) per annum nor be less than eighteen percent (18%) per annum. (1)There shall be added to

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the amount shown as tax on a return for which the full amount of any state tax or any portion or

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deficiency has not been paid up to thirty (30) days beyond date in which the payment became due

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and payable, or any fraction thereof which failure continues, a penalty of five percent (5%) of the

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amount of such tax;

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     (2) There shall be added to the amount shown as tax on a return for which the full amount

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of any state tax or any portion or deficiency has not been paid in an excess of thirty (30) days up

 

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to sixty (60) days, or any fraction thereof which failure continues, a penalty of seven and one-half

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percent (7.5%) of the amount of such tax;

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     (3) There shall be added to the amount shown as tax on a return for which the full amount

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of any state tax or any portion or deficiency has not been paid in an excess of sixty (60) days or

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more, which failure continues, a penalty of ten percent (10%) of the amount of such tax.

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     (c) "Prime rate" as used in subsection (b) of this section means the predominant prime

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rate quoted by commercial banks to large businesses as determined by the board of governors of

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the Federal Reserve System.

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     SECTION 2. Section 44-19-20 of the General Laws in Chapter 44-19 entitled "Sales and

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Use Taxes - Enforcement and Collection" is hereby amended to read as follows:

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     44-19-20. Interest and penalties on delinquent payments.

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     (a) Any person who fails to pay any tax to the state or any amount of tax required to be

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collected and paid to the state, except amounts of determinations made by the tax administrator

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under §§ 44-19-11 -- 44-19-14 within the required time shall pay a penalty of ten percent (10%)

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five percent (5%) of the tax or amount of the tax, in addition to the tax or amount of the tax, plus

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interest at the annual rate provided by § 44-1-7 from the date on which the tax or amount of the

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tax required to be collected became due and payable to the state until date of payment thirty (30)

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days from the date on which the tax or amount of the tax required to be collected became due and

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payable to the state; shall pay a penalty of seven and one-half percent (7.5%) of the tax or amount

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of the tax, in addition to the tax or amount of the tax, plus interest at the annual rate provided by §

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44-1-7 from thirty-one (31) days from the date on which the tax or amount of the tax required to

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be collected became due and payable to the state until sixty (60) days from the date on which the

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tax or amount of the tax required to be collected became due and payable to the state; shall pay a

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penalty of ten percent (10%) of the tax or amount of the tax, in addition to the tax or amount of

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the tax, plus interest at the annual rate provided by § 44-1-7 from sixty-one (61) days from the

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date the tax required to be collected became due and payable to the date until date of payment.

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     (b) Payment of any tax to the state or any amount of tax required to be collected and paid

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to the state shall be paid no later than midnight of the date when such tax is due and payable.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION -- STATE TAX OFFICIALS -- SALES AND USE TAXES --

ENFORCEMENT AND COLLECTION

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     This act would provide that a tax payment shall be paid by midnight on the date in which

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the tax becomes due and payable. It provides for penalties of five percent (5%) for taxes

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remaining unpaid from date such tax became due and payable up to thirty (30) days beyond the

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due date; seven and one-half percent (7.5%) for taxes remaining unpaid from thirty-one (31) days

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from the date such tax became due and payable up to sixty (60) days; and ten percent (10%) for

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taxes remaining unpaid from sixty-one days from the date such tax became due and payable and

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beyond.

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     This act would take effect upon passage.

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