HomeMy WebLinkAboutORD04ORDINANCE NO. 4
AN ORDINANCE OF THE CITY OF APACHE JUNCTION,
ARIZONA IMPOSING AND LEVYING A TRANSACTION PRIVILEGE
TAX, AS AUTHORIZED BY THE CONSTITUTION OF THE STATE OF
ARIZONA, ARTICLE 9, SECTION 6.
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Article 8-5 TRANSACTION PRIVILEGE TAX .
8-5-1 Definitions
8-5-2 Permit Requirements
8-5-3 Imposition of Tax - -Tax Schedule
8-5-4 Exemptions
8-5-5 Administration and Procedures
8-5-6 Assessment and Appeal
8-5-7 Violations
Section 8-5-1 Definitions
In this article unless the context requires otherwise:
A."Assembler"means a person who unites or combines products,wares or
articles of manufacture so as to produce a .change in form or substance
without changing or altering the component parts.This definition
shall not be interpreted to include activities listed in paragraphs
2,3,4,5,8 and 9 of Section 8-5-3 (A)of this article.
B."Auditor"means any ci ty employee or agent authorized by the tax collector
to audit records of a person subject to the tax specified by this chapter
and may include an employee of another city or town.
C."Business"includes all activities or acts,personal or corporate,
engaged in and caused to be engaged in with the object of gain,benefit
or advantage,either direct :or indirect,but not casual activities .
or sales.
D."Contracting"means engaging in business as a contractor.
E."Contractor"means a person who,for either a fixed sum,price,fee,
percentage,bonus or other compensation other than actual wages,undertakes
to or offers to undertake to,or purports to have capacity to undertake
to,or submits a bid to,or does himself or by or through Others,construct,
alter,repair,add to,subtract from,improve,move,wreck or demolish
any building,highway,road,railroad excavation or other structure,
project,development or improvement,or to do any part thereof,including
the erection of scaffolding or other structures or works in connection
therewith.The term "contractor"includes subcontractors,specialty
contractors,developers and speculative builders.
F."Engaging",when used with reference to engaging or continuing in business,
means the exercise of corporate or franchise powers.
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G."Gross income"means the gross receipts of a taxpayer derived from '
trade,business,commerce or sales and the value proceeding cr accruing
from the sale of tangible personal property or service,or both,and
without any deduction on account of losses.
H."Gross proceeds of sales"means the value proceeding or accruing from
the sale of tangible personal property without any deduction on account
of the cost of property sold,expense of any kind,or losses,but cash
discounts allowed and taken on sales shall not be included as gross
income;"gross income"or "gross proceeds of sale"shall not be construed
to include goods,wares or merchandise,or value thereof,returned
by customers when the sale price is refunded either in cash or by credit,
nor the sale of any article accepted as part payment on any new article
sold,i f and when the full sale price of the new article is included
in the "gross income"or "gross proceeds of sales",as the case may
be.
I ."Gross receipts"means the total amount of sale,lease or rental price,
as the case may be,of the retail sales of retailers,including any
services that are a part of the sales,valued in money,whether received
in money or otherwise,including all receipts,cash,credits and property
of every kind or nature,and any amount for which credit is allowed
by the seller to the purchaser,without any deduction therefrom on
account of the cost of the property sold,materials used,labor service
performed,interest paid,losses or any other expense.The term does
not include cash discounts allowed and taken or the sale price of property
returned by customers,when the full sale price thereof is refunded
either in cash or by credit.
J."Hotel"means any public or private hotel,inn,hostelry,tourist home
or house,motel,rooming house,apartment house,trailer or other lodging
place within the City of Apache Junction offering lodgina,wherein the owner
and operator thereof,for compensation,furnishes lodging to any transient,
except foster homes,rest homes,sheltered care homes,nursing homes
or hospitals.
K."Lodging"and "lodging space"means the use or possession,or the right
to the use or possession,of any room or apartment in a hotel,or the
right to the use or possession of the furnishings or to the services
and accommodations accompanying the use and possession of the room,
including storage or parking space for the property of a transient.
L."Manufacturer"means a person who is principally engaged in the fabrication,
production or manufacture of products,wares or articles for use from
raw or prepared materials,imparting to such materials new forms,qualities,
properties or combinations.This definition shall not be interpreted
to include activities listed in paragraphs 2,3,4,5,8 and 9 of Section
8-5-3 (A)of this code.
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M."Modifier"means a person who reworks,changes or adds td products,
wares or articles of manufacture.This definition shall not be interpreted
to include activities listed in paragraphs 2,3,4,5,8 and 9 of Section
8-5-3 (A)of this code.
N."Notice"means a written instrument served by the town as follows,
with time commencing from date of mailing,serving,filing or recording:
1.By registered or certified mail to the last known address of the
person to whom i t is required to be given;or
2.By personal service upon the person or his lawful representative;
or
3.By filing or recording with a clerk of the superior court or a
county recorder.
0."Owner -builder"means a person who owns or leases real property within
the City acting as .a contractor in constructing any improvement upon
the real property Which real property as improved is held by such person
for his use or for rental purposes.An owner -builder who sells such
real property as improved at any time on or before the expiration of
twenty-four months after an occupancy permit for such improvement. is
issued,or i f no permit is issued,within twenty-four months after
final inspection of the improvement or when the improvement is completed,-
whichever is later,shall be treated as a "prime contractor"for purposes
of this article.For purposes of this definition,a "sale"of real
property as improved includes any form of transaction whether characterized
as a lease or otherwise which in substance is a sale and -includes any
lease of the improvement for A term of thirty years or more with all
options for renewal being included as a part of the term.
P."Permanent resident"means any person who,as of a given date,has
occupied lodging space or has paid or become obligated to pay for the
right to occupy lodging space,in a particular hotel for the thirty
consecutive days next preceding such date,or has signed and performs
under a lease.
Q."Person"or "company",herein used interchangeably,means an individual,
officer,agent,firm,partnership,joint venture,association,corporation,
estate,trust or any other group or combination acting as a unit,and
the plural as well as the singular number,unless the intent to give
a more limited meaning is clearly intended by the context.
R."Prime contractor"means a contractor which the owner or lessee of
the real property being improved treats as being responsible for admin-
istration,construction and completion of the improvement.For purposes
of this definition,a person who,for either a fixed sum,price,fee,
percentage,bonus or other compensation other than actual wages,undertakes
to or offers to undertake to,or submits a bid to,or does himself
or by or through others,supervises the construction of the improvement,
or coordinates the construction of the improvement,or both,is a'prime
contractor,unless such supervisor or coordinator demonstrates,to
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the CiVs satisfaction,that another contractor is,in fact,the prime
contractor for the improvement;provided,a person acting on behalf
of an owner -builder rendering consulting services shall -not be regarded
as a prime contractor if:
1.Such person does not guarantee a maximum price
to the owner -builder;
2.Such person does not contract with contractors
improvement;and
for the improvement
constructing the
3.Such person is not responsible to the owner -builder for the admin-
istration,construction and completion of the improvement.
S."Repairer"means a person who restores or renews products,wares or
articles of manufacture.This definition shall not be interpret0
to include activities listed in paragraphs 2,3,4,5,8 and 9 of
Section 8-5-3 (A)of this article.
T."Retailer"means every person engaged in the business of making sales
at retail,and when in the opinion of the tax collector i t is necessary
for the efficient administration of this article,includes dealers,
distributors,supervisors and employers,and salesmen,representatives,
peddlers or canvassers as the agents of such dealers,distributors,
supervisors or employers under whom they operate or from whom they
obtain the tangible personal property sold by them,whether in making
sales on their own behalf or on the behalf of such dealers,distributors,
supervisor or employers.
U."Retail sale"or "sale at retail"means a sale for any purpose other
than for resale in the form of tangible personal property but the
.expressions of "transfer of possession","lease"and "rental"as used
in the definition of "sale",mean only such transactions as are found
upon investigation to be in lieu of sales as defined without the words
"lease"or "rental".
V."Room rental"means the total charge,exclusive of all federal,state
and municipal taxes,made by any hotel for lodging or lodging space
furnished any transient.I f the charge made by such hotel to such
transient includes any charge for services or accommodations in addition
to that of lodging,or the use of lodging space,then such portion
of the total charge as represents only room or lodging space rental
shall be distinctly set out and billed to such transient by such hotel
as a separate item.
W."Sale"means any transfer of title or possession,or both,exchange,
barter;lease or rental,conditional or otherwise,in any manner or
by any means whatsoever,of tangible personal property,for a consideration
or any agreement therefor,and includes,but is not limited to:
1.Any transaction whereby the possession of property is transferred,
but the seller retains a security interest for the payment of the
purchase price.
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2.The fabrication.of tangible personal property for consumers who
furnish either directly or indirectly the materials used in the
fabrication work,where such fabrication is customarily included
in the sale price of similar tangible personal property sold to
consumers.
3.The furnishing,preparing or serving for a consideration of any
tangible personal property consumed on the premises of the person
furnishing,preparing or serving such tangible personal property.
X."Stock"means the goods and wares of a person kept for sale and traffic,
and for the purpose of this article shall include,but not be limited
to all tangible personal property specially ordered for any customer,
i f for any reason such specially ordered property is brought into the
City prior to completion of the sale.
Y."Tangible personal property"means personal •property which may be seen,
weighed,measured,felt,touched or is in any other manner perceptible
to the senses.
Z."Tax collector"means the Council of the City of its
agent.
authorized
AA."Taxpayer"means any person liable for any tax imposed by this article.
BB."Transient"means any person who,for any period of not more than
thirty days,either at his own expense or at the expense of another,
obtains lodging or the use of any lodging space in any hotel for which
lodging or use of lodging space a charge is made.
CC."Wholesaler"or "jobber"means any person who sells tangible personal
property for resale by a licensed retailer and does not sell tangible
personal property for consumption by the purchaser.When a person
normally selling for resale makes any sale at retail or for consumption
by the purchaser,such person is defined as a "retailer"for purposes
of this article.
Sec.8-5-2 Permit Requirements
A.Every person having a gross proceeds of sales or gross income upon
which a privilege tax is imposed by this article desiring to engage
in or to continue in business activities within the town shall make
application to the tax collector for a transaction privilege permit,
accompanied by a fee of two dollars,and no person shall engage in
business or continue in business within the town until he shall have
such a permit.This fee shall become effective for all new permits
at the start of the day on which this article becomes effective.
Previously existing privilege licenses shall be considered to be trans-
action privilege permits for the purposes of this article.
0 -0 -C DUJIIIL33 o --
B.Application for privilege permits required under this article shall
be made uport forms prescribed by the tax collector.
C.I t shall be a condition precedent to issuance of a permit that all
provisions of this code,ordinances,regulations and requirements
affecting the public peace,health and safety be complied with in toto.
D.The privilege permit required by Section 8-5-2 (A)shall be good so
long as all returns and tax payments are made as required by this
article.
E.Upon the failure of any person to pay the required tax,penalty and
interest within a period of thirty days after i t becomes due,the tax
collector may give such person notice of intent to cancel the privilege
permit.I f the person so notified requests a hearing within ten days
from notice,he shall be granted a hearing before the tax collector.
Upon a finding by the tax collector that tax,penalty and interest
is unpaid and has remained unpaid at least thirty days,or i f no request
for hearing has been received within ten days after notification as
herein provided,the privilege permit shall be cancelled and 5uch
permit shall not be reissued until all such taxes,penalty and interest
due shall have been paid.
F.Any person whose privilege permit has been cancelled shall be required
to pay a fee of twenty-five dollars for each reissue of a permit and
such permit shall not be reissued until all taxes,penalties and interest
have been paid.The tax collector may,at his discretion,reissue
under the previous permit number or issue a new permit.
G.A person engaged in or conducting taxable business in two or more
established locations within the City shall be required to obtain a
separate permit for each location,except that for the business of
leasing or renting the use or occupancy of real property,only one
application for such property within the City shall be required;however,
the applicant shall be required to list all such property by street
address or other satisfactory identification and shall notify the tax
collector within ten days after sale or acquisition of any such real
property,clearly identified by location in such instance.
H.At the time a taxable business is sold,or when any other ownership
change occurs,a new privilege permit shall be obtained for each permit
effective at the time of such change.
I .Any person holding a privilege permit shall be required to notify the
tax collector of any change in either mailing address or location
within fifteen days after such change occurs.A fee of one dollar
shall be required whenever any change in location of a business within
the City occurs.
J.The permit prescribed in Section 8-5-2 (A)shall be nontransferable
and shall be displayed in some conspicuous part of the applicant's
place of business.
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Sec.8-5-2 Imposition of Tai' --Tax Schedule
There is hereby levied and shall be collected by the tax collector for
the purpose of raising revenue to be used in defraying the necessary expenses
of the City,privilege taxes measured by the amounts or volume of business
transacted by persons on account of their business activities,and in the
amounts to be determined by the application of rates against values,gross
proceeds of sales or gross income,as the case may be,in accordance with
the following schedule:
A.Percentage of tax and business liable to taxation.An amount equal
to one percent of the gross proceeds of sale or gross income from the
business upon every person engaging in or continuing within the City
in the following businesses:
1.Transporting for hire persons or property by any means of transportation,
from a point within the City to another point within the City or
from a point within the City to another point within the State
of Arizona;provided,that the levy shall not apply to common or
contract carriers paying a tax under the provisions of Arizona
Revised Statutes Section 40-641.
2.Mining,quarrying,smelting or producing for sale,profit or commercial
use,any oil,natural gas,limestone,sand,gravel,copper,gold,
silver or other mineral product,compound or combination of mineral
products,or felling,producing or preparing timber or any produce
of the forest for sale,profit or commercial use.In computing
the tax,the price shall be reduced by the actual freight paid
by any person from the place of production to the place of delivery
when the freight is included in the sale prices of the products.
3.Producing and furnishing,or furnishing to consumers,electricity,
electric lights,current,power or gas,natural or artificial,
and water.
4.Transmitting local or long distance messages or conversations by
telephone,or messages by telegraph,from a point within theCity
to another point within the State of Arizona,including gross
income derived from tolls,subscriptions and services on behalf
of subscribers,or by publication of a directory of the names of
subscribers.
5.Operating a pipe line for transporting oil,or natural or artificial
gas,through pipes or conduits from a point within the City to
another point in the City or in the state.
6.Operating private railroad car lines,as they are defined in Title
42,Chapter 4,Article 3,Arizona Revised Statutes,from one point
within the town to another point in the City or state.
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7.Publication of newspapers,magazines or other periodicals and
publications,when published within the City,including the gross
incOme .derived from advertising,notices and subscriptions sold
within the City:Subscriptions sold within the City for newspapers,
magazines or other periodicals and publications published without -
the town shall also be taxable under this section,and advertising
sold within the town shall likewise be taxable.
8.Job printing,engraving,embossing and copying,advertising by
billboards,direct mail,radio,television or by any means calculated
to appeal to prospective purchasers or users.
9.The contracting business or acting as a prime contractor,or both.
a.For purposes of this classification,there shall be subtracted
from the gross income,gross proceeds .of sale or gross receipts
subject to the privilege tax,a deduction in the amount of
thirty-five percent of said gross income,gross proceeds of
sale or gross receipts in lieu of any labor,shop or subcontractor
deductions.Subcontractors or others who perform services
.in respect of the improvement,building,highway,road,railroad,
excavation or other structure,project,development or improvement
(hereinafter "job")are exempt from the privilege tax.on their
gross income,gross proceeds of sale or gross receipts derived
from the job i f they can demonstrate to the City's satisfaction
that the job was within the control of a prime contractor or
prime contractors and that such prime contractor paid or should
have paid the privilege tax upon the gross income,gross proceeds
of sale or gross receipts attributable to the job and from
which the subcontractors or others were paid.
b.An owner -builder,who is not a prime contractor,shall pay
the privilege tax or use tax,as the case may be,upon the
sales to him or to his account of all tangible personal property
incorporated or fabricated into any structure,project,development
or improvement undertaken by him;provided,i f the owner -builder
is treated as a prime contractor for privilege tax purposes,
he shall deduct from the gross income,gross proceeds of sale
or gross receipts derived from the sale (as defined under owner-
builder)of the real property as improved by him:
(1)An amount of thirty-five percent of said gross income,
gross proceeds of sale or gross receipts in lieu of any
labor,shop or subcontractor deductions;
(2)Either a tax credit equal to the amount of privilege or
use tax,or the equivalent tax,paid to the City of Apache Junction
or another city or town in respect of the tangible personal
property incorporated or fabricated into the said structure,
.project,development or improvement undertaken by him;
and
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(3)A tax credit equal to the amount of privilege taxes paid
by the contractor or subcontractors to the City of Apache Junction
on the gross income,gross proceeds of sale or gross
receipts derived by the contractor or subcontractor from
the construction of the improvement upon the real property
owned or leased by the owner -builder and sold by him.
c.Reporting by contractors.Contractors shall report on a progressive
billing basis or cash receipts basis,but home builders,speculative
or otherwise,and owner -builders shall report as gross income,
gross proceeds of sale or gross receipts the total selling
price at the time of closing of escrow or transfer of title:
d.Deductions allowable and pertaining to the gross income,gross
proceeds of sale or gross receipts may not be taken prior to
the time that said proceeds or receipts are reported.
10.Restaurants,dining rooms,lunchrooms,lunch stands,soda fountains,
bars,taverns or similar establishments where articles of food
or drink are sold,and catering or sale of food and drink from
mobile units within the town.Articles of food or drink prepared
for service or resale by another person may be deducted,providing
that the person reselling has a valid privilege permit for such
purpose.
11.Selling at retail such property used by human beings for food,
drink or condiment,whether simple,mixed or compound,where such
property is not customarily sold for consumption on the premises
commonly and generally known as the business of selling groceries
at retail..
The sale to hotels,restaurants,lunchrooms,boarding houses or
similar establishments of articles used by human beings for food,
drink or condiment,whether simple,mixed or compounded,where
such articles are customarily prepared and served to patrons for
consumption on the premises,shall be deemed wholesale sales as
to such ccmmodities,providing that the person reselling has a
valid privilege permit for such purpose.
12.Selling any tangible personal property whatsoever at retail or
to the ultimate consumer,including but not limited to sale of
new and used vehicles of any type,and sales made from mobile units
when within the town.Gross receipts from painting signs on structures
within the town or upon vehicles while within the town shall be
taxed as retail sales,without deduction.Sales of tangible personal
property within the State of Arizona which result from activities
of agents or representatives of a person whose principal office
within Arizona is within the City of Apache Junction shall be taxable,
provided that delivery is made from the City_
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13.Operating or conducting amusements including but not limited to
theaters,movies,operas,exhibitions,concerts,carnivals,circuses,
shows of any type or nature,amusement park admissions,amusement
rides,menageries,fairs,races,contests,games,golf courses,
tennis courts,batting or driving ranges,riding on any animals,
juke boxes,pinball machines,billiard and pool parlors,bowling
alleys,dance halls,public dances,boxing or wrestling matches,
or any other business charging admission fees for exhibition or
amusement.Nonprofit private clubs where basic membership fees
cover use of amusement facilities,and amusements conducted by
the organizations themselves on an occasional basis to raise funds
for projects of bona fide religious organizations,nonprofit educational
institutions and nonprofit fraternal or service clubs are exempt.
14.Leasing or renting for a consideration any tangible personal property;
sales of tangible personal property to be so leased or rented shall
be deemed to be resale sales.
15.Leasing or renting for a consideration the use or occupancy of
real property,including any improvements,rights or interest in
such property.
B.Basis for taxation under certain conditions.
1.In determining value as applied to sales from one to another person,
or other circumstances where the relation between the buyer and
seller is such that the gross proceeds from the sale are not indicative
of the true value of the subject matter of the sale,the council
may prescribe uniform and equitable rules for determining the value
upon which the tax herein levied shall be based,corresponding
as nearly as possible to the gross proceeds from the sale of similar
products of like quality or character of other taxpayers where
no common interest exists between the buyer and seller,but otherwise
under similar circumstances and conditions.
2.For the purpose of computing the tax by this article,"conditional
or time sales"shall be treated as credit sales and tax shall be
based only upon the amounts received under such security agreements,
but i f the seller transfers his interest in such agreements to
a third person,he shall pay an amount based upon the full sale
price of the commodity,unless a record is kept of payments thereafter
made on the contract in such, manner that the tax collector may
at all times ascertain from the records of the seller the amount
paid thereon by the purchaser.I f at any time the tax collector
cannot ascertain the amount paid thereon,the tax shall be computed
to include any amounts not shown to be paid by the records of the
seller to the satisfaction of the tax collector.
3.When any person is engaged in an occupation or business to which
Section 8-5-3 is applicable,such person's books shall be kept
so as to show separately the gross proceeds of sale of tangible
personal property and the gross income from sales of nontaxable
service,and i f not so kept,the tax shall be based upon the total -
of such person's gross proceeds of sales of tangible personal
property and gross income from service.
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4.When any person is engaged in the business of selling tangible
personal property at both wholesale and retail,the retail rate
shall be applied only to the gross proceeds of the sales made other
than at wholesale when such person's books are kept so as to show
separately the gross proceeds of sales of each class,and when
such books are not so kept,the retail rate shall be applied to
the gross proceeds of every sale so made.
5.For the purpose of Section 8-5-3,the total amount of gross income,
gross receipts or gross proceeds of sale shall be deemed to be
the amount of the sale,exclusive of the tax imposed by Section
8-5-3,providing the person upon whom the tax is imposed shall
establish to the satisfaction of the tax collector that any tax
collected from customers has been added to the sale price and not
absorbed by him.
Sec.8-5-4 Exemptions
The following shall not be subject to taxation under this article:
A.Any business,calling,profession or occupation where the general law
of the State of Arizona or general law of the United States of America
.preclude the levying of such a tax.
B.Sales in interstate or foreign commerce when prohibited from being
so taxed by the Constitution or general laws of the United States or
by the Constitution of the State of Arizona.
C.Professional services,instruction and other services not connected
with the making of retail sales.
D.Contracting,retail sales and any other taxable activity for the City
of Apache Junction.
E.Sales of gasoline upon which a tax has been imposed under the provisions
of Title 28,Chapter 9,Article 9,Arizona Revised Statutes.
F.Sales of tangible personal property to a person licensed as a contractor
under Title 32,Chapter 10,Arizona Revised Statutes,who holds a valid
privilege tax permit for engaging in or continuing in the business
of contracting when the property so sold is incorporated or fabricated
by the contractor into any structure,project,development or improvement
in fulfillment of a contract therefor.
G.Sales of tangible personal property made directly to the United States
Government,its departments or agencies,by the manufacturer,modifier,
assembler or repairer.A deduction of fifty percent shall be permitted
where such sales are made by persons other than those specified in
the previous sentence.
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H.Sales of tangible personal property by persons engaging nin or continuing
in the business of processing,manufacturing,fabricating,modifying,
assembling or repairing,when such sales are made for resale and not
at retail and not to an ultimate consumer.
This subsection shall not apply to any sales of tangible personal property
which are not the same as or similar to tangible personal property
sold through distributors,jobbers,wholesalers,retailers or other
persons than those substantially and principally engaging or continuing
in the actual manufacturing,processing,fabricating,modifying or
assembling thereof.
I .Sales of tangible personal property to manufacturers,modifiers,or
assemblers where such property directly enters into and becomes an
ingredient or component part of any manufactured,fabricated or processed
article,substance or commodity for sale in the regular course of business.
J.Services provided in connection with retail sales i f invoices to the
customer,sales tickets,cash register tapes and all other business
records show separate charges for such services.This exemption shall
apply only where such service is not customarily included in the retail
sale itself and where such service is not an essential element in the
retail sale itself.No deduction shall be allowed for fabrication
labor of retail items sold.
K.Sales of tangible personal property in which all of the following occur
without the City limits of the City of Apache Junction.
1.The placement of the order.
2.The stock from which delivery was made.
3.The transference of title and possession.
For the purposes of this exemption,any person engaging or continuing
in the business to which this exemption is applicable shall maintain
and keep accounting records or books indicating separately the gross
proceeds of sale or gross income of tangible personal property which
occur without the town limits,and i f not so maintained the tax to
be imposed will be upon the total of such person's gross proceeds of
sale or gross income.
L.The sale of drugs on the prescription of a member of the medical,
dental or veterinary profession who is licensed by law to administer
such drugs.
M.All personal property purchased in this City by any hospital organized
and operated exclusively for charitable purposes,no part of the net
earnings of which inures to the benefit of any private shareholder
or individual,or operated by the state or any political subdivision
of this state.
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N.The sale of stock and bonds.
0.Sales of machinery or equipment to be used directly in manufacturing,
processing,fabricating,job printing,refining or metallurgical operations,
including leaching,milling,precipitating,smelting and refining.
P.Sales of machinery or equipment to be used directly in the process
of extracting ore or minerals from the earth for commercial purposes,
including equipment required to prepare the materials for extraction
and for the handling,loading or transportation of such extracted
material to the surface.
Q.Sales to telephone or telegraph companies of central office switching
equipment,switchboards,private branch exchange equipment,microwave
radio and carrier equipment and coaxial cable.
R.Sales of machinery,equipment or transmission lines to be used directly
in the production or transmission of electrical power,but not for
such machinery,equipment or transmission lines that are to be used
for distribution and not for transformers and control equipment to
be used at transmission substation sites.
S.Sales of pipes or valves four inches in diameter or larger to be used
for transporting oil,natural gas,artificial gas,water or coal slurry.
T..Sales of aircraft,navigational and communication instruments and other
accessories and related equipment to be used in conjunction with or
.to become part of aircraft to be used in the transportation of persons,
property or U.S.Mail in intrastate,interstate or foreign air transportation
for hire by airlines holding a federal or state certificate of public
convenience and necessity or holding a foreign air carrier permit.
U.Sales of railroad rolling stock,rails,ties and signal control equipment
to be used directly in the transportation of persons or property in
intrastate or interstate transportation for hire.
V.Sales of machinery or equipment to be used directly in the drilling
for oil or gas or used directly in the process of extracting oil or
gas from the earth for commercial purposes.
Sec.8-5-5 Administration and Procedures
A.Vested administration and payment of tax.The administration of this
article is vested in and exercised by the City of Apache Junction,except
as otherwise specifically provided,and all payments shall be made to the
City of Apache Junction.I f payment is made in any other form than
money which is legal tender in the State of Arizona and the United
States of America,the tax obligation shall not be ended until the
check,bank draft or money order has been honored by the person on
whom drawn.
8-5-5 BUSINESS 8-5-5
B.Presumption that all gross receipts are taxable.For the purpose of
the proper administration of this article and to prevent evasion of
the tax hereby imposed,i t shall be presumed that all gross receipts
are subject to the tax until the contrary is established by the person
seeking the exemption from said taxation.
C.Burden of proving sale was not at retail.The burden of proving that
a sale of tangible personal property was not a sale at retail shall
be upon the person who made it,unless such person shall have taken
from the purchaser a certificate to the effect that the property was
purchased for resale.
D.Tax imposed is cumulative and supplemental to others.The tax imposed
by this article shall be cumulative and supplemental to all other taxes
levied by law.
E.Records of taxpayer.I t shall be the duty of every person engaging
or continuing in business activities within this town for which a
privilege tax is imposed by this article to keep and preserve for a
minimum of three years,suitable records of the gross income,gross
receipts of sales,invoices for goods and merchandise purchased and
sold,resale certificates,job labor records and all other such books
or accounts as shall be necessary to determine the amount of tax for .
which such person is liable under the provisions of this article.
Collection of back privilege taxes by the town shall be limited to
a period of three years prior to the date when the tax collector began
an audit of the taxpayer's books,wrote to the person through use of
ordinary mail concerning an apparent violation of the article,or took
some other recorded action to require a privilege tax permit application
or other compliance with the article.All records mentioned in this
subdivision above,shall be open for examination at any time by the
tax collector.
F.Divulging of information forbidden.I t is unlawful for any officer, employee
or agent of the City of Apache Junction.to make known i n any manner
whatsoever the business affairs,operations or information obtained
by an investigation of records and equipment of any person visited
or examined in the discharge of his official duty,or the amount or
source of income,profits,leases,expenditures or any particular
thereof,set forth or disclosed in any return or report,or the amount
of tax paid.The council may,by motion,authorize an examination
of the reports made pursuant to this article by the United States
Director of Internal Revenue or the proper officials of the State of
Arizona.Successors,receivers,trustees,executors,administrators
and assignees,i f directly interested,may be given information as
to the items included in the measure and amounts of any unpaid tax
or amounts of tax required to be collected interest and penalties.
Divulging of applicable information to any authorized employee or agent
of an incorporated city or town shall be permitted when an employee
or agent of another incorporated city or town is authorized by the
tax collector to conduct audits for the City -of Apache Junction.Information
supplied on privilege permit applications shall not be considered as
confidential.Any officer,employee or agent of the City of Apache Junction
shall be authorized to divulge such confidential information as may •
be necessary upon the order of a court of competent jurisdiction.
8-5-5 BUSINESS 8-5-5
G.Inadequate records.In the event the records of the gross income,
gross receipts or gross proceeds of sales of the business,kept by
the taxpayer,are deemed by the tax collector to be unsuitable,or
the taxpayer does not keep such other books or records as may be necessary
to determine the amount of the tax for which he is liable under the
provisions of this article,the tax collector may prescribe the form
and manner of keeping such books and records.In the event the taxpayer
fails or refuses to follow such prescribed form,and the tax collector
cannot ascertain from the records kept by the taxpayer the gross income,
gross receipts or gross proceeds of sale of the business or the amount
of the tax for which the taxpayer is liable under the provisions of
this article,the tax collector may proceed as though such taxpayer
failed or refused to make a return in the manner prescribed by this
article.
H.When tax payable.Except as otherwise specified in this article,the
taxes levied under this article shall be due and payable on or before
the fifteenth day of the month next succeeding the period in which
the tax accrues and shall be delinquent five days thereafter.The
taxpayer shall,on or before the fifteenth day of the stated month,
make out a return showing the gross amount,any authorized deductions,
taxable amount and amount of the tax due for the preceding month.
The taxpayer shall'be required to use the report form authorized by
the tax collector,and shall mail or deliver the same,together with
remittance for the amount of tax due,payable to the City of Apache Junction
to the tax collector or any City employee authorized to receive such
payment.The tax return shall be signed by the taxpayer or his authorized
agent,and such signature shall be evidence that the person signing
the return verifies the accuracy of the information supplied in the
return.
1.In any case where the taxpayer has a reported total "taxable amount"
of fifteen hundred dollars or less for the previous calendar quarter
of the year,the taxpayer may make application to report and pay
the tax on a quarterly basis,upon the written approval of the
tax collector.Any taxpayer on a quarterly.reporting basis must
report and pay accrued tax due on or before the fifteenth day of
the month following the calendar quarter to be reported.
2.I f the taxpayer later reports a total "taxable amount"for any
quarter of fifteen hundred dollars or more,he shall report and
pay on a monthly basis.
I .Cash receipts or accrual basis.The taxpayer may elect to file returns
and pay his tax either on a cash receipts or accrual basis,but the
taxpayer shall not change from one basis to the other,without the
prior written approval of the tax collector.As a condition of granting
such approval,the tax collector may require an audit of the taxpayer's
records.
8-5-5 BUSINESS 8-5-5
J.Consolidated returns.'Any person engaging in two or more forms of
business of like classification taxable under this article may file
a consolidated return covering all business activities of like classi-
fication in which he is engaged within the town.
K.Extension of time for making returns.The tax collector may for good
cause extend the date for making any return required under the provisions
of this article,but the date for filing such return shall not be
extended beyond the fifteenth day of the second month next succeeding
the regular due date.
L.Penalty for delinquency.Any taxpayer who shall have failed to pay
such tax within five days from the date upon which such payment shall
have become due shall be subject to and shall pay a penalty of ten
percent of the amount of such tax,together with interest on such tax
at the rate of one-half of one percent per month or fraction thereof
until paid.'
M.Correction of errors.I f the taxpayer makes an error or errors in
computing the tax assessable against him,the tax collector shall
correct such error and notify the taxpayer promptly by ordinary mail
that such correction has been made.Any additional tax for which the
taxpayer becomes liable shall be payable within ten days after the
letter or form showing the correction is mailed to the taxpayer.I f
the taxpayer makes an error which results in overpayment of tax,the
tax collector shall allow credit against tax due on future returns
or shall authorize a refund to the taxpayer.
N.Duties of person quitting business,his successor or assignee.Any
person who sells his business or stock of goods or quits business shall
be required to make the return provided for under this article within
fifteen days after the date he sold his business or stock of goods
or quit business,and his successor in business or assignee shall be
required to withhold a sufficient amount of the purchase money to cover
the amount of said taxes due and unpaid until such time as the former
owner shall produce a receipt from the tax collector showing that the
taxes have been paid,or a certificate that no taxes are due.
1.I f the purchaser of a business or stock of goods shall fail to
withhold purchase money as above provided and the taxes shall be
due and unpaid after the fifteen -day period herein provided,he
shall be personally liable for the payment of the taxes accrued
and unpaid on account of the operations of the business by the
former owner.
2.Transaction privilege tax liability of the purchaser shall be
limited to no more than that accrued during a period of one full
year prior to the date such business purchase becomes effective.
8-5-5 BUSINESS 8-5-5
3.I t is unlawful for the purchaser to refuse or fail to pay the back
taxes accrued during said period within thirty days after the tax
collector mails a letter or other notice by ordinary mail to the
purchaser requesting such payment of back taxes.
0.Tax shall be lien.The tax imposed by this article,i f not reported
and paid by the due date specified by this article,shall constitute
a lien on the property of any person subject to this article.The
procedure to perfect such lien shall be as follows:
1.The tax collector shall give written notice to the taxpayer at
his last known mailing address by certified or registered mail,
or such notice may be sent to the address at which the business
is conducted.This written notice shall indicate that the City
will file a lien on the subject property unless the taxpayer reports
and pays all the tax past due including any penalties and interest
due under this article or provides satisfactory evidence to the
tax collector that no taxes are due,within a period of thirty
days from service or receipt of said written notice.
2.I f the taxpayer does not pay taxes due or provide evidence that
no taxes are due within thirty days after service or receipt of
said written notice,the tax collector may prepare in triplicate
copies of a "Notice and Claim of Lien"and file one copy with the
county recorder of the county in which the property is located.
The tax collector shall then send by certified or registered mail
a copy to the taxpayer at his last known mailing address or at
the address at which the business is conducted.The "Notice and
Claim of Lien"shall contain the following:
a.A description of the property sufficient for identification.
b.The name of the taxpayer as owner or reputed owner of the
property.
c.The amount of the delinquent tax,including penalties and
interest;or i f this amount cannot be determined precisely
because suitable records and books were not made available
by the taxpayer,the amount assessed,including penalties and
interest,by the tax collector as authorized by this article
when such books and records are not available or are unsuitable.
From and after the date of its recording in the office of the county
recorder,the lien shall attach to the property until paid.A sale
of the property to satisfy the lien shall be made upon judgment of
foreclosure and order of sale.The Cityshall have the right to bring
an action to enforce the lien in the superior court of the county in
which the property is located,at any time after its recording,but
failure to enforce the lien by such actions shall not affect its validity.
The recorded "Notice and Claim of Lien"shall be prima facie evidence
of the truth of all matters recited therein and the regularity of all
proceedings prior to the recording therein.
8-5-6 BUSINESS 8-5-6
A prior recording for the purposes provided in this section shall not
be a bar to the subsequent recording of a lien for such purposes,and
any number of such liens on the same property may be enforced in the
same action.
P.Tax collector may examine books and papers.The tax collector may
examine any books,papers,records or other data bearing upon the
correctness of -any return or for the purpose of making a return where
none has been made,as required by the provisions of this article.
I f any person shall fail to appear before the tax collector or to
answer any material question or to produce any books,records,papers
or other data when requested to do so,such failure or refusal shall
be reported to the City attorney,who shall thereupon institute proceedings
in the superior court of the county where such witness resides to
obtain compliance.
Taxpayer's liability.The liability of the taxpayer for taxes due
shall remain the same,whether he collects sufficient added payments
from his customers to cover such taxes due.
Q.
1.Where the taxpayer fails to show "tax collected",deductible "repair
labor"and other deductible "service"on invoices to customers,.
sales slips and cash register slips,and on all applicable books
and records,he shall be liable for taxation on his full gross
receipts without allowance for such items.
2.The burden of proof for all deductions by any taxpayer shall be
on the taxpayer,who must prove to the satisfaction of the tax
collector that such deductions shall have been legal and proper
under this article.A person taking deductions for "resale"or
for "payments to subcontractors"shall not take such deductions
unless the persons for whom the deductions are taken have obtained
the required privilege tax permits.
R.Tax liabilities of partners.All taxes assessed under the provisions
of this article upon the business activities of a partnership shall
be a liability and charges against each and all of the individual
partners;but when paid by the partnership,•such liability against
each and all of the individual partners shall cease.
Sec.8-5-6 Assessment and Appeal
A.Assessment procedure.I f any person who is required to file a return
under the provisions of this article fails or refuses to make a return,
the tax collector shall proceed,in such a manner as he may deem best,
to obtain facts and information on which to base the assessment of
the tax herein prescribed;and to this end the tax collector may make
examination of the books,records and papers of any such person;and
may take the evidence on oath of any person whom he may believe to
be in possession of facts or information pertinent to the subject of
8-5-7 BUSINESS .8-5-7
3.I f court action has been taken by the taxpayer under paragraph
2 above,all subsequent payments due shall be paid on or before
the due date.However,i f each tax form is plainly marked "Paid
Under Protest",such subsequent payments shall be treated as part
of the original protest until such time as court remedies have
been exhausted or the court action withdrawn by the taxpayer.
D.Collection of delinquent taxes.
1.I f any tax imposed by this article,or any protion thereof,is
not paid within thirty days after the same becomes delinquent,
the tax collector shall be empowered to commence court action in
any appropriate court of competent jurisdiction to collect tax,
penalties and interest due,and to utilize any and all appropriate
remedies as authorized under the laws of the State of Anizona.
Such actions may be commenced whether separate criminal charges
have been filed to cover alleged failure to comply with this article.
2.Every tax imposed by this article and all increases,interest and
penalties thereon,shall become,from the time the same is due
and payable,a personal debt from the person liable to the town
and i t shall be payable to and recoverable by the tax collector.
E.Adoption of administrative procedure.The council is hereby authorized
to adopt written administrative regulations to implement the enforcement
of this article or to further define terms used in the article.Such
administrative regulations shall be enforceable as though they were
integral portions of the article itself.
F.State of Arizona administrative procedures.Except where such regulations
would conflict with administrative regulations adopted by the council
or with provisions of this article,all regulations on the transaction
privilege tax adopted by the State Department of Revenue under the
authority of Title 41,Chapter 6,Article 1,Arizona Revised Statutes
and amendments thereto,shall be considered as part of this article
and enforceable as such.
Sec.8-5-7 Violations
A.Advertisement regarding taxes.I t is unlawful for any person engaged
in any of the businesses classified in Section 8-5-3 to advertise or
hold out to the public in any manner,directly or indirectly,that
the tax herein imposed is not considered as an element in the price
to the consumer.
B.Permit required.I t is unlawful for any person engaging in a business
subject to the city transaction privilege tax to fail to obtain a
permit before beginning or continuing such business.
8-5-6 BUSINESS 8-5-6
inquiry,which oath the tax collector may administer.I f no other
information is readily available,the tax collector may make a reasonable
judgment on the basis of past reports by the taxpayer or by any predecessor.
When the tax collector has reached a decision as to the assessment,
he shall notify the taxpayer in writing of such assessment,which shall
become final within thirty days after such notice has been mailed or
served,unless the taxpayer shall notify the tax collector in writing
of a request for a tax hearing within said thirty days.
B.Hearing at taxpayer's request.When a taxpayer requests a hearing
as indicated in Section 8-5-6 (A)such hearing shall normally be held in the
offices of the City of Apache Junction provided that the tax collector
may choose another suitable room in the same city or by mutual agreement
with the taxpayer,he may hold the hearing in such other place as may
prove desirable.The hearing shall be conducted by the tax collector,
and i t shall be closed to all except the tax collector and his authorized
representatives and the taxpayer and his authorized representatives,
unless the taxpayer agrees in writing to waive restrictions on release
of confidential information.The tax collector shall provide the
taxpayer with not less than ten days notice of the date,time and place
of the hearing.During the hearing the taxpayer or his authorized
representative may present any evidence he deems appropriate to the
issues or questions under consideration.Within fifteen days after
the conclusion of the hearing,the tax collector shall affirm,modify
'or vacate any decision made with respect to the issues or questions
discussed in the course of the hearing.Notice of said decision shall
be provided to the taxpayer by the tax collector as provided in this
article,and said decision shall be effective in ten days after service
of notice.
C.Payment under protest.I f any person feels aggrieved by a tax assessment
or believes that any or all of his activities are not subject to the
privilege tax required by this article,he shall pay the amount of
such assessment or tax claimed due before the delinquent date and shall
at that time give notice in writing to the tax collector that all or
part of such payment is made under protest,and shall in the notice
give the grounds and reasons for such protest and that a certain part
thereof or that the total sum is protested.
1.Within ten days after receipt of such protest,the tax collector
shall reply in writing to the last known mailing address of the
taxpayer,stating whether the assessment or tax applied is to be
changed as requested,and giving reasons for the decision.
2.I f the taxpayer is then dissatisfied,he may take appropriate
action in the superior court to recover payments made under protest.
Court action shall be taken within sixty days after the tax collector
has mailed his reply as required by paragraph 1,above.Failure
to take court action within the required sixty day period shall
make the protest null and void.
8-5-7 BUSINESS 8-5-7
C.Tax collection from customers.Any person,who collects added payments
from customers stated or indicated to be for the purpose of meeting
privilege tax obligations of such person,shall be required to use
.such money only for such purpose.I t is unlawful for any person to fail
to pay privilege tax due to the City of Apache Junction within a period
of thirty days after the date such tax is due i f evidence is provided
that such person has at any time collected such added payments from
customers.
D Failure to make return.I t is unlawful for any person or for any
officer or agent of any company or corporation to fail or refuse to
make the returns and to pay the tax provided to be paid by the provisions
of this article,or to make or permit to be made any false or fraudulent
return or false statement in any return required by this article;or
for any reason to aid or abet another in any attempt to evade the
payment of the tax,or any part thereof,imposed by this article;or
for any person'or officer or agent of a company to fail or refuse to
permit the examination of any book,paper,account,record or other
data by the tax collector as required by this article;or to violate
any of the other provisions of this article.
PASSED AND ADOPTED by the Mayor and Common Council of
Apache Junction, Arizona this ,-./..a-Tday of;;;„i„,
1979.
157
ATTEST:
9 --
City Clerk
APPROVED AS TO FORM:
,
ty Attorney