34 TAC §3.305
The Comptroller of Public Accounts adopts a new §3.305,
concerning criminal offenses and penalties, with one change in subsection
(b)(7) to the proposed text as published in the November 30, 2001, issue of
the
Texas Register
(26 TexReg 9753).
This section is adopted to implement Senate Bill 1123, 77th Legislature,
2001, which amended Tax Code, Chapter 151, to create new offenses and impose
penalties and to increase penalties for other criminal offenses. This section
will provide information to taxpayers concerning sales and use tax criminal
offenses and penalties.
No comments were received regarding adoption of the amendment.
The new section is adopted under Tax Code, §111.002, which
provides the comptroller with the authority to prescribe, adopt, and enforce
rules relating to the administration and enforcement of the provisions of
the Tax Code, Title 2.
The new section implements the Tax Code, Chapter 151.
§3.305.Criminal Offenses and Penalties.
(a)
General. Tax Code, Chapter 151, prohibits certain activities
and provides criminal penalties for violations.
(b)
Criminal offenses provided in Tax Code, Chapter 151, include,
but are not limited to the following:
(1)
A seller commits an offense if the seller directly or indirectly
advertises or holds out to the public that the seller will assume, absorb,
or refund any portion of the tax, or that the seller will not add the tax
to the sales price of taxable items. This offense is a misdemeanor punishable
by a fine of not more than $500 for each occurrence.
(2)
A person commits an offense if the person intentionally
or knowingly makes a false entry in, or a fraudulent alteration of, an exemption
or resale certificate, or if the person makes, presents, or uses an exemption
or resale certificate with knowledge that it is false and with intent that
the certificate be accepted as valid. An offense is:
(A)
a Class C misdemeanor if the tax evaded by the invalid
certificate is less than $20;
(B)
a Class B misdemeanor if the tax evaded by the invalid
certificate is $20 or more but less than $200;
(C)
a Class A misdemeanor if the tax evaded by the invalid
certificate is $200 or more but less than $750;
(D)
a felony of the third degree if the tax evaded by the invalid
certificate is $750 or more but less than $20,000; and
(E)
a felony of the second degree if the tax evaded by the
invalid certificate is $20,000 or more.
(3)
A person or officer of a corporation commits an offense
if the person or the corporation engages in business as a seller in this state
without a permit or with a suspended permit. A separate offense is committed
each day a person operates a business without a permit or with a suspended
permit. An offense is:
(A)
a Class C misdemeanor for a first offense;
(B)
a Class B misdemeanor punishable by a fine not to exceed
$2,000 for a second conviction;
(C)
a Class A misdemeanor punishable by a fine not to exceed
$4,000 for a third conviction; and
(D)
a Class A misdemeanor punishable by a fine not to exceed
$4,000, confinement in jail for a term not to exceed a year, or both the fine
and confinement for a fourth or subsequent conviction.
(4)
A person commits an offense if the person intentionally
or knowingly fails to pay to the comptroller the tax collected by that person.
An offense is:
(A)
a Class C misdemeanor if the amount of the tax collected
and not paid is less than $10,000;
(B)
a state jail felony if the amount of the tax collected
and not paid is $10,000 or more but less than $20,000;
(C)
a felony of the third degree if the amount of the tax collected
and not paid is $20,000 or more but less than $100,000; and
(D)
a felony of the second degree if the amount of the tax
collected and not paid is $100,000 or more.
(5)
A person commits an offense if the person refuses to furnish
a report as required by Tax Code, Chapter 151, or by the comptroller. An offense
is:
(A)
a Class C misdemeanor for a first offense;
(B)
a Class B misdemeanor punishable by a fine not to exceed
$2,000 for a second conviction; and
(C)
a Class A misdemeanor punishable by a fine not to exceed
$4,000 for a third or subsequent conviction.
(6)
A person commits an offense if the person intentionally
or knowingly conceals, destroys, makes a false entry in, or fails to make
an entry in records that are required to be made or kept under Tax Code, Chapter
151. An offense is a felony of the third degree.
(7)
A person commits an offense if the person fails to produce
or allow inspection of a record that is required to be kept under Tax Code,
Chapter 151, within an allowed period of time after a person who is authorized
by the comptroller requests the record. An offense is a Class C misdemeanor.
A separate offense is committed each day the person fails to allow inspection
of records or fails to produce records after the allowed time period expired.
See subsection (c) of this section for certain restrictions.
(c)
Inspection and Demand for Production. Tax Code, §151.023
permits the comptroller to inspect business premises where a taxable event
has occurred and to issue a written demand notice to a taxpayer or to an employee,
an authorized representative, or agent of the taxpayer for the production
of documents within 10 business days of delivery of the notice. This authority
will be exercised within the parameters outlined in subsection (f) of §3.281
of this title (relating to Records Required; Information Required). The Comptroller
may file criminal charges with appropriate authorities for violations of Tax
Code, §151.023, if the taxpayer fails to permit inspection or fails to
produce documents in response to a demand by the comptroller's Enforcement
Division or Criminal Investigation Division.
(d)
Venue. Travis County or the county in which any element
of the offense occurs is the venue for prosecution for any offense incurred
under Tax Code, Chapter 151.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on January 29, 2002.
TRD-200200529
Martin Cherry
Deputy General Counsel for Taxation
Comptroller of Public Accounts
Effective date: February 18, 2002
Proposal publication date: November 30, 2001
For further information, please call: (512) 475-0387