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Item S8 JUN-06-03 11,42 FROM,MONROE COUNTY ATTY OFFICE 10,3052923516 PACE 1/1 BOARD OF COUNTY COMMISSIONERS AGENDA ITEM SUMMARY Meeting Date: June 18. 2003 DivisIon: County Administrator Bulk Item: Yes _ No -X- Department: County Administrator AGENDA ITEM WORDING: Approval of an Amnesty Program for property taxes due prior to July 1, 2003. ITEM BACKGROUND: On May 29, 2003 the Rorida Department of Revenue informed the County via the attached memorandum of the legislated Tax Amnesty Program. The Board will note that the State had to be informed of the County's interest by June 1, 2003. Given the limited amount of time available for a decision to be made, the Administrator spoke with the Tax Collector and it was determined that the County could indicate its intention by June 1 and that the final dedsion could be made no later than June 18. Since that is the date of this meeting the Tax Collector informed the State Department of Revenue of the County's interest so that the Board of County COmmissioners could have the opportunity to consider this policy. The description of the program is induded in the May 29, 2003 Rorida Department of Revenue memorandum. It is not posstble, especially on such notice, for the Tax Collector to determine any loss of revenue to the County. PREVIOUS RELEVANT BOCC ACTlONl N/A - CONTRACT I AGREEMENT CHANGES: N/A STAFF RECOMMENDAnONS: Approval TOTAL COST: Not Detennined BUDGETED: Yes _ No ~ SOURCE OF fUNDS: COST TO COUN1Y: Not Determined REVENUE PRODUCING: Yes X No AMOUNT PER MONTH_ YR APPROVED BY: County A4/ OMB/Purchaslng _ Risk Management_ DMSJON DIRECTOR APPROVAL, ---./ ~ ~ . James l. Roberts, County Administrator DOCUMENTATION: Included x To Follow Not Required DIsposmON: AGENDA ITEM # if!J Z"d "'vSv-2Sa-SO€ UJWPM o~ $~~~qg~ , 5~wer @80:01 EO 90 unr ENROLLED 2003 Legislature CS for SB 18-A 1 2 An act relating to taxation; directing the 3 Department of Revenue to develop and implement 4 an amnesty program for taxpayers subject to the 5 state and local taxes imposed by chapters 125, 6 198, 199, 201, 202, 203, 206, 211, 212, 220, 7 221, 336, 370, 376, 403, 538, 624, 627, and 8 681, F.S.; providing time periods; providing 9 program guidelines; providing for eligible 10 participants; providing for waiver of penalties 11 and interest under specified circumstances; 12 providing for emergency rules; amending ss. 13 213.235, 220.807, F.S.; providing that the 14 interest rate on certain tax deficiencies shall 15 be an adjusted prime rate plus 4 percentage 16 points; providing a maximum rate; providing 17 legislative intent; providing an appropriation; 18 amending s. 202.35, F.S.; providing a maximum 19 interest rate on delinquent taxes; amending s. 20 626.932, F.S.; changing the distribution of the 21 surplus lines tax; amending s. 626.938, F.S.; 22 changing the distribution of the tax on 23 independently procured coverages; providing for 24 construction of the act in pari materia with 25 laws enacted during the Regular Session of the 26 Legislature; providing effective dates. 27 28 Be It Enacted by the Legislature of the State of Florida: 29 30 Section 1. (1) No later than July 1, 2003, the 31 Department of Revenue shall develop and implement an amnesty 1 CODING:Words 5trickeI. are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SB 18-A 1 program for taxpayers subject to the state and local taxes 2 imposed by chapters 125, 198, 199, 201, 202, 203, 206, 211, 3 212, 220, 221, 336, 370, 376, 403, 538, 624, 627, and 681, 4 Florida Statutes. 5 (2) The amnesty program shall be a one-time 6 opportunity for eligible taxpayers to satisfy their tax 7 liabilities under the revenue laws of this state and thereby 8 avoid criminal prosecution, penalties, and interest as 9 provided in subsections (4), (5), and (6). Any taxpayer that 10 has entered into a settlement of liability for state or local 11 option taxes before July 1, 2003, whether or not full and 12 complete payment has been made of the settlement amount, shall 13 not be eligible to participate in the amnesty program. 14 (3) The amnesty program shall be in effect for a 15 4-month period beginning on July 1, 2003, and ending on 16 October 31, 2003. The amnesty program shall apply only to tax 17 liabilities due prior to July 1, 2003. In order to 18 participate in the amnesty program, eligible taxpayers must 19 file the forms and other documentation specified by the 20 Department of Revenue, including, but not limited to, returns 21 and amended returns, must make full payment of tax due, and 22 must make payment of the interest due as provided in 23 subsections (4) and (5). 24 (4) A taxpayer may participate in the amnesty program 25 whether or not the taxpayer is under audit, inquiry, 26 examination, or civil investigation initiated by the 27 Department of Revenue, regardless of whether the amount due is 28 included in a proposed assessment or an assessment, bill, 29 notice, or demand for payment issued by the Department of 30 Revenue, and without regard to whether the amount due is 31 subject to a pending administrative or judicial 2 CODING:Words st~icken are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SB 18-A 1 proceeding. If any of the circumstances set forth in this 2 subsection apply, the taxpayer shall be required to pay the 3 full amount of the tax due and 75 percent of the amount of 4 interest due. When the department has issued a notice of 5 intent to conduct an audit to a taxpayer but has not commenced 6 the audit, the taxpayer may apply to the department during the 7 amnesty program for approval to have the audit converted to 8 the certified audits program authorized by section 213.285, 9 Florida Statutes. When a taxpayer has been approved during the 10 amnesty program to have an audit converted to the certified 11 audits program, payment of any liability determined as a 12 result of this participation in the certified audits program 13 must be made during the period the amnesty program is in 14 effect. A taxpayer that is participating in the certified 15 audits program authorized by section 213.285, Florida 16 Statutes, shall be eligible tor the interest and penalty 17 compromises authorized by either the amnesty program or the 18 certified audits program, but not both. 19 (5) If the circumstances set forth in subsection (4) 20 do not apply and the initial contact with the Department of 21 Revenue is made by the taxpayer pursuant to the amnesty 22 program, the taxpayer shall be required to pay the full amount 23 of the tax due and 50 percent of the amount of interest due. 24 (6) No penalties shall be imposed on any tax paid 25 pursuant to the amnesty program, and the Department of Revenue 26 shall not initiate a criminal investigation against or refer 27 for prosecution any taxpayer participating in the amnesty 28 program with respect to the failure to timely pay the tax 29 disclosed in the amnesty program. 30 (7) Participation in the amnesty program shall be 31 conditioned upon the taxpayer's express waiver of rights to 3 CODING:Words stricken are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SB 18-A 1 contest taxes being reported pursuant to the amnesty program. 2 If the taxes reported pursuant to the amnesty program are the 3 subject of a pending informal protest under section 213.21, 4 Florida Statutes, or of administrative or judicial proceedings 5 that have not become final as of the date payment of the taxes 6 is made pursuant to the amnesty program, participation in the 7 amnesty program is conditioned upon the taxpayer's withdrawal 8 of such informal protest or dismissal of such administrative 9 or judicial proceeding. Participation in the amnesty program 10 shall also be conditioned upon the taxpayer's express 11 agreement to waive any right to claim a refund or to protest 12 or initiate an administrative or judicial proceeding to review 13 any denial of a refund claim for any refund of tax or interest 14 paid under the amnesty program except as provided in this 15 subsection. No refund may be made of any penalty or interest 16 paid prior to July 1, 2003. .Any credit or refund of tax or 17 interest paid as a result of participation in the amnesty 18 program shall be strictly limited to amounts determined by the 19 Department of Revenue to have been paid in error. 20 (8) A taxpayer under criminal investigation, 21 indictment, information, or prosecution regarding a revenue 22 law of this state shall not be eligible to participate in the 23 amnesty program. A taxpayer that has been convicted of a crime 24 regarding a revenue law of this state shall not be eligible to 25 participate in the amnesty program. 26 (9) With or without an audit, the Department of 27 Revenue is authorized to issue a notice or demand for payment 28 with respect to any tax or interest that it determines to be 29 due with any return filed under the tax amnesty program, and 30 such notice and demand shall be prima facie correct in any 31 administrative, judicial, or quasi-judicial proceeding. 4 CODING:Words st~icken are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SB 18-A 1 (10) The Department of Revenue may, on the basis of 2 fraud, misrepresentation, or mutual mistake of fact, rescind a 3 grant of amnesty, including any amnesty granted as a result of 4 participation in the certified audit program during the period 5 the amnesty program is in effect. Any taxpayer that files 6 under the amnesty program false or fraudulent returns, forms, 7 or documentation or attempts in any manner to defeat or evade 8 a tax is subject to applicable penalties and criminal 9 prosecution. 10 (11) Any local option tax administered by a local 11 government that imposed the tax pursuant to a statute 12 permitting self-administration is excluded from the amnesty 13 program unless the local government notifies the Department of 14 Revenue by June I, 2003, that it chooses to participate in the 15 amnesty program. 16 (12) The executive director of the Department of 17 Revenue is authorized to adopt emergency rules under sections 18 120.536(1) and 120.54(4), Florida Statutes, to implement the 19 amnesty program. Such rules may provide forms, procedures, 20 terms, conditions, and methods of payment appropriate for fair 21 and effective administration of the amnesty program and to 22 ensure the taxpayer's ongoing commitment to proper remittance 23 of taxes to the state. Notwithstanding any other law, the 24 emergency rules shall remain in effect until the later of the 25 date that is 6 months after the date of adoption of the rule 26 or the date of final resolution of all amnesty applications 27 filed pursuant to this section. 28 Section 2. Effective November 1, 2003, subsections (2) 29 and (3) of section 213.235, Florida Statutes, are amended to 30 read: 31 213.235 Determination of interest on deficiencies.-- 5 CODING:Words st~icken are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SB 18-A 1 (2) If the adjusted prime rate charged by banks, 2 rounded to the nearest full percent, plus 4 percentage points, 3 during either: 4 (a) The 6-month period ending on September 30 of any 5 calendar year, or 6 (b) The 6-month period ending on March 31 of any 7 calendar year 8 9 differs from the interest rate in effect on either such date, 10 the executive director of the department shall, within 20 11 days, establish an adjusted rate of interest equal to such 12 adjusted prime rate plus 4 percentage points. 13 (3) An adjusted rate of interest established under 14 this section becomes effective: 15 (a) On January 1 of the succeeding year, if based upon 16 the adjusted prime rate plus..4 percentage points for the 17 6-month period ending on September 30; or 18 (b) On July 1 of the same calendar year, if based upon 19 the adjusted prime rate plus 4 percentage points for the 20 6-month period ending on March 31. 21 Section 3. Amendments made by this act to section 22 213.235(2) and (3), Florida Statutes, apply to interest due on 23 tax payment deficiencies that arise on or after November 1, 24 2003, and also apply to interest due on tax payment 25 deficiencies that arose on or after January 1, 2000, but 26 remain unpaid as of November 1, 2003. When calculating the 27 rate that takes effect on November 1, 2003, the department 28 shall use in making that calculation the adjusted prime rate 29 charged by banks, rounded to the nearest full percent, during 30 the 6-month period ending on March 31, 2003. 31 6 CODING:Words stricken are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SB 18-A 1 Section 4. Effective November 1, 2003, subsections 2 (1), (2), and (3) of section 220.807, Florida Statutes, are 3 amended to read: 4 220.807 Determination of rate of interest.-- 5 (1) The annual rate of interest applicable to this 6 chapter shall be the adjusted rate established by the 7 executive director of the Department of Revenue under 8 subsection (2), except that the annual rate of interest shall 9 never be greater than 12 percent. 10 (2) If the adjusted prime rate charged by banks, 11 rounded to the nearest full percent, plus 4 percentage points, 12 during either: 13 (a) The 6-month period ending on September 30 of any 14 calendar year; or 15 (b) The 6-month period ending on March 31 of any 16 calendar year, 17 18 differs from the interest rate in effect on either such date, 19 the executive director of the Department of Revenue shall, 20 within 20 days, establish an adjusted rate of interest equal 21 to such adjusted prime rate plus 4 percentage points. 22 (3) An adjusted rate of interest established under 23 this section shall become effective: 24 (a) On January 1 of the succeeding year, if based upon 25 the adjusted prime rate plus 4 percentage points for the 26 6-month period ending on September 30; or 27 (b) On July 1 of the same calendar year, if based upon 28 the adjusted prime rate plus 4 percentage points for the 29 6-month period ending on March 31. 30 Section 5. Amendments made by this act to section 31 220.807(1), (2), and (3), Florida Statutes, apply to interest 7 CODING:Words stricker. are deletions; words underlined are additions. .~:,,';\,~~:;~!,':;'~jl;''iJ!:'~'',~~'~'''''''', - ENROLLED 2003 Legislature CS for SB 18-A 1 due on tax payment deficiencies that arise on or after 2 November 1, 2003, and also apply to interest due on tax 3 payment deficiencies that arose on or after January 1, 2000, 4 but remain unpaid as of November 1, 2003. When calculating the 5 rate that takes effect on November 1, 2003, the department 6 shall use in making that calculation the adjusted prime rate 7 charged by banks, rounded to the nearest full percent, during 8 the 6-month period ending on March 31, 2003. 9 Section 6. Effective November 1, 2003, subsection (1) 10 of section 202.35, Florida Statutes, is amended to read: 11 202.35 Powers of department in dealing with 12 delinquents; tax to be separately stated.-- 13 (1) If any dealer or other person fails to remit the 14 tax, or any portion thereof, on or before the day when the tax 15 is required by law to be paid, there will be added to the 16 amount due interest at the rate calculated pursuant to s. 17 213.235 of the amount due from the date due until paid, except 18 that the annual rate of interest shall never be greater than 19 12 percent. Interest on the delinquent tax is to be calculated 20 beginning on the 21st day of the month following the month for 21 which the tax is due, except as otherwise provided in this 22 chapter. 23 Section 7. The sum of $610,000 is appropriated from 24 the General Revenue Fund to the Department of Revenue for the 25 purpose of administering the amnesty program created by this 26 act. Funds remaining unexpended or unencumbered from this 27 appropriation as of June 30, 2003, shall revert and be 28 reappropriated for the same purpose in fiscal year 2003-2004. 29 Section 8. Subsection (5) of section 626.932, Florida 30 Statutes, is amended to read: 31 626.932 Surplus lines tax.-- 8 CODING:Words ~tricken are deletions; words underlined are additions. ENROLLED 2003 Legislature CS for SE 18-A 1 (5) The department shall deposit 24.3 55 percent of 2 all taxes collected under this section to the credit of the 3 Insurance Commissione~'s Regulatory Trust Fund. Seventy-five 4 and seven-tenths Fo~ty five percent of all taxes collected 5 under this section shall be deposited into the General Revenue 6 Fund. 7 Section 9. Subsection (7) of section 626.938, Florida 8 Statutes, is amended to read: 9 626.938 Report and tax of independently procured 10 coverages.-- 11 (7) The department shall deposit 24.3 55 percent of 12 all taxes and interest collected under this section to the 13 credit of the Insurance ConLflLissiOI.e~' s Regulatory Trust Fund. 14 Seventy-five and seven-tenths Forty five percent of all taxes 15 and interest collected under this section shall be deposited 16 into the General Revenue Fund. 17 Section 10. If any law that is amended by this act was 18 also amended by a law enacted at the 2003 Regular Session of 19 the Legislature, such laws shall be construed as if they had 20 been enacted during the same session of the Legislature, and 21 full effect should be given to each if that is possible. 22 Section 11. Except as otherwise specifically provided 23 in this act, this act shall take effect upon becoming a law. 24 25 26 27 28 29 30 31 9 CODING:Words st~icken are deletions; words underlined are additions.