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HomeMy WebLinkAboutORD972ORDINANCE NO.972 AN ORDINANCE OF THE MAYOR AND CITY COUNCIL OF THE CITY OF APACHE JUNCTION,ARIZONA,RELATING TO THE PRIVILEGE LICENSE TAX;ADOPTING "THE 1996 AMENDMENTS TO THE CITY TAX CODE OF THE CITY OF APACHE JUNCTION,ARIZONA,INCLUDING A TAXPAYER BILL OF RIGHTS"BY REFERENCE; ESTABLISHING AN EFFECTIVE DATE; REPEALING ANY CONFLICTING PROVISIONS;PROVIDING FOR SEVERABILITY;AND PROVIDING PENALTIES FOR VIOLATIONS. BE IT ORDAINED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF APACHE JUNCTION, ARIZONA,AS FOLLOWS: SECTION I IN GENERAL That certain document known as "The 1996 Amendments to the City Tax Code of the City of Apache Junciton,Arizona,including a Taxpayer Bill of Rights",three copies of which are on file in the office of the city clerk of the City of Apache Junction, Arizona,which document was made a public record by Resolution No.96- 38 of the City of Apache Junciton,Arizona,is hereby referred to,adopted and made a part hereof as if fully set out in this ordinance. SECTION I I EFFECTIVE DATE The provisions of this ordinance and the public record adopted herein are effective from and after December 31,1996. SECTION III REPEALING ANY CONFLICTING PROVISIONS All ordinances and parts of ordinances in conflict with the provisions of this ordinance or any part of the tax code adopted herein by reference are hereby repealed. SECTION IV PROVIDING FOR SEVERABILITY I f any section,subsection,sentence,phrase,clause or portion of this ordinance,or any part of the tax code adopted herein by reference is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction,such decision shall not affect the validity of the remaining portions thereof. SECTION V PROVIDING PENALTIES Any person found guilty of violating any provision of these amendments to the tax code shall be guilty of a class one mismemeanor.Each day that a violation continues shall be a separate offense punishable as herein above described. APPROVED AND ADOPTED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF APACHE JUNCTION,ARIZONA,THIS 5TH DAY OF NOVEMBER ,1996. ORDINANCE NO.972 PAGE 1 OF 2 SIGNED AND ATTESTED TO THIS 5TH DAY OF NOVEMBER ,1996. ATTEST: KATHLEEN CON City Clerk d7,4_ ELEY ORDINANCE NO.972 PAGE 2 OF 2 Mayor THE 1996 AMENDMENTS TO THE CITY TAX CODE OF THE CITY OF APACHE JUNCTION, ARIZONA INCLUDING A TAXPAYER BILL OF RIGHTS Section 1.Section 8A-100 of the City Tax Code of the City of Apache Junction is amended to read: Sec. 8A-100. General definitions. For the purposes of this Chapter, the following definitions apply: "Assembler"means a person who unites or combines products, wares, or articles of manufacture so as to produce a change in form or substance of such items without changing or altering component parts. "Broker"means any person engaged or continuing in business who acts for another for a consideration in the conduct of a business activity taxable under this Chapter, and who receives for his principal all or part of the gross income from the taxable activity. "Business"means 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. "Business Day"means any day of the week when the Tax Collector's office is open for the public to conduct the Tax Collector's business. "Casual Activity or Sale"means a transaction of an isolated nature made by a person who neither represents himself to be nor is engaged in a business subject to a tax imposed by this Chapter.However, no sale, rental, license for use, or lease transaction concerning real property nor any activity entered into by a business taxable by this Chapter shall be treated, or be exempt, as casual. This definition shall include sales of used capital assets, provided that the volume and frequency of such sales do not indicate that the seller regularly engages in selling such property. "Combined Taxes"means the sum of all applicable Arizona Transaction Privilege and Use Taxes; all applicable transportation taxes imposed upon gross income by this County as authorized by Chapter 8.3, Title 42, Arizona Revised Statutes; and all applicable taxes imposed by this Chapter. "Commercial Property"is any real property, or portion of such property, used for any purpose other than lodging or lodging space, including structures built for lodging but used otherwise, such as model homes, apartments used as offices, etc. "Communications Channel"means any line, wire, cable, microwave, radio signal, light beam, telephone, telegraph, or any other electromagnetic means of moving a message. "Construction Contracting"refers to the activity of a construction contractor. "Construction Contractor"means a person who undertakes to or offers to undertake to, or purports to have the 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 to real property, or to do any part thereof."Construction contractor" includes subcontractors, specialty contractors, prime contractors, and any person receiving consideration for the general supervision and/or coordination of such a construction project. This definition shall govern without regard to whether or not the construction contractor is acting in fulfillment of a contract. "Delivery (of Notice) by the Tax Collector"means "receipt (of notice) by the taxpayer". 1 "Delivery. Installation. or Other Direct Customer Services"means services or labor, excluding repair labor, provided by a taxpayer to or for his customer at the time of transfer of tangible personal property; provided further that the charge for such labor or service is separately billed to the customer and maintained separately in the taxpayer's books and records. "Engaging",when used with reference to engaging or continuing in business, includes the exercise of corporate or franchise powers. "Equivalent Excise Tax"means either: (1)a Privilege or Use Tax levied by another Arizona municipality upon the transaction in question, and paid either to such Arizona municipality directly or to the vendor; or (2)an excise tax levied by a political subdivision of a state other than Arizona upon the transaction in question, and paid either to such jurisdiction directly or to the vendor; or (3)an excise tax levied by a Native American Government organized under the laws of the federal government upon the transaction in question, and paid either to such jurisdiction directly or to the vendor. "Federal Government"means the United States Government, its departments and agencies; but not including national banks or federally chartered or insured banks, savings and loan institutions, or credit unions. "Eoggl" means any items intended for human consumption as defined by rules and regulations adopted by the Department of Revenue, State of Arizona, pursuant to A.R.S. Section 42-1387.Under no circumstances shall "food" include alcoholic beverages or tobacco, or food items purchased for use in conversion to any form of alcohol by distillation, fermentation, brewing, or other process. "Hotel"means any public or private hotel, inn, hostelry, tourist home, house, motel, rooming house, apartment house, trailer,or other lodging place within the City offering lodging, wherein the owner thereof, for compensation, furnishes lodging to any transient, except foster homes, rest homes, sheltered care homes, nursing homes, or primary health care facilities. "Job Printing"means the activity of copying or reproducing an article by any means, process, or method."Job printing" includes engraving of printing plates, embossing, copying, micrographics, and photo reproduction. "Lessee"includes the equivalent person in a rental or licensing agreement for all purposes of this Chapter. "Lessor"includes the equivalent person in a rental or licensing agreement for all purposes of this Chapter. "Licensing (for Use)"means any agreement between the user ("licensee") and the owner or the owner's agent ("licensor") for the use of the licensor's property whereby the licensor receives consideration, where such agreement does not qualify as a "sale" or "lease" or "rental" agreement. "Lodging (Lodging Space)"means any room or apartment in a hotel or any other provider of rooms, trailer spaces,or other residential dwelling spaces;or the furnishings or services and accommodations accompanying the use and possession of said dwelling space, including storage or parking space for the property of said tenant. "Manufactured Buildings"means a manufactured home, mobile home or factory built building, as defined in A.R.S. Section 41-2142. "Manufacturer"means a person engaged or continuing in the business of fabricating,producing,or manufacturing products, wares, or articles for use from other forms of tangible personal property, imparting to such new forms, qualities, properties, and combinations. "Mining and Metallurgical Supplies"means all tangible personal property acquired by persons engaged in activities defined in Section 8A-432 for such use. This definition shall not include: (1)janitorial equipmentand supplies. 2 (2)office equipment, office furniture, and office supplies. (3)motor vehicles licensed for use upon the highways of the State. "Modifier"means a person who reworks, changes, or adds to products, wares, or articles of manufacture. "Nonprofit Entity"means any entity organized and operated exclusively for charitable purposes, or operated by the Federal Government, the State, or any political subdivision of the State. "Occupancy (of Real Property)"means any occupancy or use, or any right to occupy or use, real property including any improvements, rights, or interests in such property. "Out -of -City Sale"means the sale of tangible personal property and job printing if all of the following occur: (1)transference of title and possession occur without the City;anq (2)the stock from which such personal property was taken was not within the corporate limits of the City;an (3)the order is received at a permanent business location of the seller located outside the City; which location is used for the substantial and regular conduct of such business sales activity. In no event shall the place of business of the buyer be determinative of the situs of the receipt of the order. For the purpose of this definition it does not matter that all other indicia of business occur within the City, including, but not limited to, accounting, invoicing, payments, centralized purchasing, and supply to out -of -City storehouses and out -of -City retail branch outlets from a primary storehouse within the City. "Out -of -State Sale"means the sale of tangible personal property and job printing if all of the following occur: (1)The order is placed from without the State of Arizona; aLL11 (2)the order is placed by other than a resident of the State to be determined in a manner similar to "resides within the City";and (3)the property is delivered to the buyer at a location outside the State;and (4)the property is purchased for use outside the State. "Owner -Builder"means an owner or lessor of real property who, by himself or by or through others, constructs or has constructed or reconstructs or has reconstructed any improvement to real property. "Person"means an individual, firm, partnership, joint venture, association, corporation, estate, trust, receiver, syndicate, broker, the Federal Government, this State, or any political subdivision or agency of this State.For the purposes of this Chapter, a person shall be considered a distinct and separate person from any general or limited partnership or joint venture or other association with which such person is affiliated. A subsidiary corporation shall be considered a separate person from its parent corporation for purposes of taxation of transactions with its parent corporation. "Primary Health Care Facility"means any hospital or any licensed nursing care institution or licensed residential care institution, licensed pursuant to Chapter 4, Title 36, Arizona Revised Statutes, or any licensed kidney dialysis center. "Prosthetic"means any of the following tangible personal property if such items are prescribed or recommended by a licensed podiatrist, chiropractor, dentist, physician or surgeon, naturopath, optometrist, osteopathic physician or surgeon, psychologist, hearing aid dispenser, physician assistant, nurse practitioner or veterinarian: (1)any man-made device for support or replacement of a part of the body, or to increase acuity of one of the senses.Such items include: prescription eyeglasses; contact lenses; hearing aids; artificial limbs or teeth; neck, back, arm, leg, or similar braces. (2)insulin,afid insulin syringes,AND GLUCOSE TEST STRIPS sold with or without a prescription. (3)hospital beds, crutches, wheelchairs, similar home health aids, or corrective shoes. (4)drugs or medicine, including oxygen. 3 (5)equipment used to generate, monitor, or provide health support systems, such as respiratory equipment, oxygen concentrator, dialysis machine. (6)DURABLE MEDICAL EQUIPMENT WHICH HAS A FEDERAL HEALTH CARE FINANCING ADMINISTRATION COMMON PROCEDURE CODE, IS DESIGNATED REIMBURSABLE BY MEDICARE,CAN WITHSTAND REPEATED USE,IS PRIMARILY AND CUSTOMARILY USED TO SERVE A MEDICAL PURPOSE,IS GENERALLY NOT USEFUL TO A PERSON IN THE ABSENCE OF ILLNESS OR INJURY AND IS APPROPRIATE FOR USE IN THE HOME. "Receipt (of Notice) by the Taxpayer"means the earlier of actual receipt or the first attempted delivery by certified United States mail to the taxpayer's address of record with the Tax Collector. "Rental Equipment"means tangible personal property sold, rented, leased, or licensed to customers to the extent that the item is actually used by the customer for rental, lease, or license to others; provided that: (1)(Reserved) (2)the vendee is regularly engaged in the business of renting, leasing, or licensing such property for a consideration; and (3)the item so claimed as "rental equipment" is not used by the person claiming the exemption for any purpose other than rental, lease, or license for compensation, to an extent greater than fifteen percent (15%) of its actual use. "Rental Supply"means an expendable or nonexpendable repair or replacement part sold to become part of "rental equipment", provided that: (1)the documentation relating to each purchased item so claimed specifically itemizes to the vendor the actual item of "rental equipment" to which the purchased item is intended to be attached as a repair or replacement part;and (2)the vendee is regularly engaged in the business of renting, leasing, or licensing such property for a consideration;and (3 )the item so claimed as "rental equipment" is not used by the person claiming the exemption for any purpose other than rental, lease, or license for compensation, to an extent greater than fifteen percent (15%) of its actual use. "Repairer"means a person who restores or renews products, wares, or articles of manufacture. "Resides within the City"means in cases other than individuals, whose legal addresses are determinative of residence, the engaging, continuing, or conducting of regular business activity within the City. "Restaurant"means any business activity where articles of food, drink, or condiment are customarily prepared or served to patrons for consumption on or off the premises, also including bars, cocktail lounges, the dining rooms of hotels, and all caterers.For the purposes of this Chapter, a "fast food" business, which includes street vendors and mobile vendors selling in public areas or at entertainment or sports or similar events, who prepares or sells food or drink for consumption on or off the premises is considered a "restaurant", and not a "retailer". "Retail Sale (Sale at Retail)"means the sale of tangible personal property, except the sale of tangible person property to a person regularly engaged in the business of selling such property. "Retailer"means any person engaged or continuing in the business of sales of tangible personal property at retail. "Sale"means any transfer of title or possession, or both, exchange, barter, conditional or otherwise, in any manner or by any means whatsoever, including consignment transactions and auctions, of property for a consideration. "Sale" includes any transaction whereby the possession of such property is transferred but the seller retains the title as security for the payment of the price."Sale" also includes the fabrication of tangible personal property for consumers who, in whole or in part, furnish either directly or indirectly the materials used in such fabrication work. 4 "Speculative Builder"means either: (1)an owner -builder who sells or contracts to sell, at anytime, improved real property (as provided in Section 8A-416) consisting of: A)custom, model, or inventory homes, regardless of the stage of completion of such homes; or B)improved residential or commercial lots without a structure; or (2)an owner -builder who sells or contracts to sell improved real property, other than improved real property specified in subsection (1) above: A)prior to completion; or B)before the expiration of twenty-four (24) months after the improvements of the real property sold are substantially complete. "Substantially Complete"means the construction contracting or reconstruction contracting: (1)has passed final inspection or its equivalent; or (2)certificate of occupancy or its equivalent has been issued; or (3)is ready for immediate occupancy or use. "Supplier"means any person who rents, leases, licenses, or makes sales of tangible personal property within the City, either directly to the consumer or customer or to wholesalers, jobbers, fabricators, manufacturers, modifiers, assemblers, repairers, or those engaged in the business of providing services which involve the use, sale, rental, lease, or license of tangible personal property. "Tax Collector"means the Revenue Officer/City Clerk or their designee or agent for all purposes under this Chapter. "Taxpayer"means any person liable for any tax under this Chapter. 'TAXPAYER PROBLEM RESOLUTION OFFICER"MEANS THE INDIVIDUAL DESIGNATED BY THE CITY TO PERFORM THE DUTIES IDENTIFIED IN SECTIONS 8A-515 AND 8A-516.IN CITIES WITH A POPULATION OF 50,000 OR MORE, THE TAXPAYER PROBLEM RESOLUTION OFFICER SHALL BE AN EMPLOYEE OF THE CITY.IN CITIES WITH A POPULATION OF LESS THAN 50,000, THE TAXPAYER PROBLEM RESOLUTION OFFICER NEED NOT BE AN EMPLOYEE OF THE CITY.REGARDLESS OF WHETHER THE TAXPAYER PROBLEM RESOLUTION OFFICER IS OR IS NOT AN EMPLOYEE OF THE CITY, THE TAXPAYER PROBLEM RESOLUTION OFFICER SHALL HAVE SUBSTANTIVE KNOWLEDGE OF TAXATION.THE IDENTITY OF AND TELEPHONE NUMBER FOR THE TAXPAYER PROBLEM RESOLUTION OFFICER CAN BE OBTAINED FROM THE TAX COLLECTOR. 'Telecommunication Service"means any service or activity connected with the transmission or relay of sound, visual image, data, information, images, or material over a communications channel or any combination of communications channels. "Utility Service"means the producing, providing, or furnishing of electricity, electric lights, current, power, gas (natural or artificial), or water to consumers or ratepayers. Section 2. Section 8A-230 of the City Tax Code of the City of Apache Junction is amended to read: Sec. 8A-230.Determination of gross income based upon method of reporting. The method of reporting chosen by a taxpayer, as provided in Section 8A-520, necessitates the following adjustments to gross income for all purposes under this Chapter: (a)aesh basis — When a person elects to report and pay taxes on a cash basis, gross income for the reporting period shall include: (1)the total amounts received on "paid in full" transactions, against which are allowed all applicable deductions and exclusions; and 5 (2)all amounts received on accounts receivable, conditional sales contract, or other similar transactions, against which no deductions and no exclusions from gross income are allowed. INTEREST ON FINANCE CONTRACTS MAY BE DEDUCTED IF SEPARATELY ITEMIZED ON ALL BOOKS AND RECORDS. (b)Accrual basis — When a person elects to report and pay taxes on an accrual basis, gross income shall include all gross income for the applicable period regardless of whether receipts are for cash, credit, conditional, or partially deferred transactions, and regardless of whether or not any security document or instrument is sold, assigned, or otherwise transferred to another.Persons reporting on the accrual basis may deduct bad debts, provided that: (1)the amount deducted for the bad debt must be deducted from gross income of the month in which the actual charge -off was made, and only to the extent that such amount was actually charged -off, and also only to the extent that such amount is or was included as taxable gross income; and (2)if any amount is subsequently collected on such charged -off account, it shall be included in gross income for the month in which it was collected, without deduction for expense of collection. Section 3. Section 8A-240 of the City Tax Code of the City of Apache Junction is amended to read: Sec. 8A-240. Exclusion of cash discounts, returns, refunds, trade-in values, vendor -issued coupons, and rebates from gross income. (a)The following items are not included in gross income: (1)Cash discounts allowed by the vendor for timely payment, but only discounts allowed against taxable gross income. (2)The value of property returned by customers to the extent of the amount actually refunded either in cash or by credit and the amount refunded was included in taxable gross income. (3 )The trade-in allowance for tangible personal property accepted as payment, not to exceed the full sales price for any tangible personal property sold, when the full sales price is included in taxable gross income.Trade-in allowances are not allowed for manufactured buildings taxable under Section 8A-427. (4)When coupons issued by a vendor are later accepted by the vendor as a discount against the transaction, the discount may be excluded from gross income as a cash discount. Amounts credited or refunded by a vendor for redemption of coupons issued by any person other than the vendor may not be excluded from gross income. (5 )Rebates issued by the vendor to a customer as a discount against the transaction may be excluded from gross income as a cash discount.Rebates issued by a person other than the vendor may not be excluded from gross income, even when the vendee assigns his right to the rebate to the vendor. (6)IN COMPUTING THE TAX BASE, GROSS PROCEEDS OF SALES OR GROSS INCOME DOES NOT INCLUDE A MANUFACTURER'S CASH REBATE ON THE SALES PRICE OF A MOTOR VEHICLE IF THE BUYER ASSIGNS THE BUYER'S RIGHT IN THE REBATE TO THE RETAILER. (b)If the amount specified in subsection (a) above is credited by a vendor subsequent to the reporting period in which the original transaction occurs, such amount may be excluded from the taxable gross income of that subsequent reporting period, but only to the extent that the excludable amount was reported as taxable gross income in that prior reporting period. 6 Section 4.Section 8A-260 of the City Tax Code of the City of Apache Junction is amended to read: Sec. 8A-260. Exclusion of motor vehiclefees and taxes from gross income; limitations. (a)There shall be excluded from gross income of vendors of motor vehicles those motor vehicle registration fees, license fees and taxes, and lieu taxes imposed pursuant to Title 28, Arizona Revised Statutes in connection with the initial purchase of a motor vehicle, but only to the extent that such taxes or fees or both have been separately itemized and collected from the purchaser of the motor vehicle by the vendor, actually remitted to the proper registering, licensing, and taxing authorities, and the provisions of Article III,regarding recordkeeping, are met.For the purpose of the exclusion provided by this subsection only, the, terms vendor and vendee shall also apply to a lessor and lessee respectively, of a motor vehicle if, in addition to all other requirements of this subsection, the lease agreement specifically requires the lessee to pay such fees or taxes, and such amounts are separately itemized in the documentation provided to the lessee. (b)There shall be excluded from gross income of vendors at retail of heavy trucks and trailers, the amount attributable to Federal Excise Taxes imposed by 26 U.S.C. Section 4051, but only to the extent that the provisions of Article III,relating to recordkeeping, have been met. (c)THERE SHALL BE EXCLUDED FROM GROSS INCOME THE FOLLOWING FEES, TAXES, AND LIEU TAXES, BUT ONLY TO THE EXTENT THAT SUCH TAXES OR FEES OR BOTH HAVE BEEN SEPARATELY ITEMIZED AND COLLECTED FROM THE PURCHASER BY THE VENDOR, ACTUALLY REMITTED TO THE PROPER REGISTERING, LICENSING, AND TAXING AUTHORITIES,AND THE PROVISIONS OF ARTICLE III,REGARDING RECORDKEEPING, ARE MET: (1)EMERGENCY TELECOMMUNICATION SERVICES EXCISE TAX IMPOSED PURSUANT TO A.R.S. SECTION 42-1472."EMERGENCY TELECOMMUNICATION SERVICES" MEANS TELECOMMUNICATION SERVICES OR SYSTEMS THAT USE NUMBER 911 OR A SIMILARLY DESIGNATED TELEPHONE NUMBER FOR EMERGENCY CALLS; (2)THE TELECOMMUNICATION DEVICES FOR THE DEAF AND THE SEVERELY HEARING AND SPEECH IMPAIRED EXCISE TAX IMPOSED PURSUANT TO A.R.S. SECTION 42-1 472 ; (3)FEDERAL EXCISE TAXES ON COMMUNICATIONS SERVICES AS IMPOSED BY 26 U.S.C. § 4251; (4)CAR RENTAL SURCHARGE IMPOSED PURSUANT TO A.R.S. SECTION 48-4234; (5)FEDERAL EXCISE TAXES ON PASSENGER VEHICLES AS IMPOSED BY 26 U.S.C. §4001(.01); (6)WASTE TIRE DISPOSAL FEES,IMPOSED PURSUANT TO A.R.S.SECTION 44-1302; LEAD ACID BATTERY FEES, IMPOSED PURSUANT TO A.R.S. SECTION 44-1323; AND USED OIL FEES IMPOSED PURSUANT TO A.R.S. SECTION 49- 814(B),(C). (d)THERE SHALL BE EXCLUDED FROM GROSS INCOME OF VENDORS OF MOTOR VEHICLES DEALER DOCUMENTATION FEES, BUT ONLY TO THE EXTENT THAT SUCH FEES HAVE BEEN SEPARATELY ITEMIZED AND COLLECTED FROM THE PURCHASER OF THE MOTOR VEHICLE BY THE VENDOR. Section 5. Section 8A-350 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-350.Recordkeeping requirements. (a)It shall be the duty of every person subject to the tax imposed by this Chapter to keep and preserve suitable records and such other books and accounts as may be necessary to determine the amount of tax for which he is liable under this Chapter.The books and records 7 must contain, at a minimum, such detail and summary information as may be required by Regulation; OR WHEN RECORDS ARE MAINTAINED WITHIN AN ELECTRONIC DATA PROCESSING (EDP) SYSTEM, THE REQUIREMENTS ESTABLISHED BY THE ARIZONA DEPARTMENT OF REVENUE FOR PRIVILEGE TAX FILINGS WILL BE ACCEPTED.It shall be the duty of every person to keep and preserve such books and records for a period equal to the applicable limitation period for assessment of tax, and all such books and records shall be open for inspection by the Tax Collector during any business day. (b)The Tax Collector may direct, by letter, a specific taxpayer to keep specific other books, records, and documents.Such letter directive shall apply: (1)only for future reporting periods, and (2)only by express determination of the Tax Collector that such specific recordkeeping is necessary due to the inability of the City to conduct an adequate examination of the past activities of the taxpayer, which inability resulted from inaccurate or inadequate books, records, or documentation maintained by the taxpayer. Section 6. Section 8A-460 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-460.Retail sales:measure of tax; burden of proof; exclusions. (a)The tax rate shall be at an amount equal to two percent (2%) of the gross income from the business activity upon every person engaging or continuing in the business of selling tangible personal property at retail. (b)The burden of proving that a sale of tangible personal property is not a taxable retail sale shall be upon the person who made the sale. (c)Exclusions.For the purposes of this Chapter, sales of tangible personal property shall not include: (1)sales of stocks, bonds, options, or other similar materials. (2)sales of lottery tickets or shares pursuant to Article I, Chapter 5, Title 5, Arizona Revised Statutes. (3)sales of platinum, bullion, or monetized bullion, except minted or manufactured coins transferred or acquired primarily for their numismatic value as prescribed by Regulation: (4)gross income derived from the transfer of tangible personal property which is specifically included as the gross income of a business activity upon which another Section of this Article imposes a tax, shall be considered gross income of that business activity, and are not includable as gross income subject to the tax imposed by this Section. (5)sales by professional or personal service occupations where such sales are inconsequential elements of the service provided. (d)Notwithstanding the provisions of subsection (a) above, when the gross income from the sale of a single item of tangible personal property exceeds two thousand dollars ($2,000), the two percent (2%) tax rate shall apply to the first $2,000.Above $2,000, the measure of tax shall be at a rate of one percent (1%). (e)•3 ••'• •'•;•,"-WHEN this City and another Arizona city or town with an equivalent excise tax could claim nexus for taxing a retail sale, the city or town where the permanent business location of the seller at which the order was received shall be deemed to have precedence, and for the purposes of this Chapter such city or town has sole and exclusive right to such tax. 5.1!1 errterein 8 (f)The appropriate tax liability for any retail sale where the order is received at a permanent business location of the seller located in this City or in an Arizona city or town that levies an equivalent excise tax shall be at the tax rate of the city or town of such seller's location. Section 7. Section 8A-465 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-465.Retail sales:exemptions. Income derived from the following sources is exempt from the tax imposed by Section 8A-460: (a)sales of tangible personal property to a person regularly engaged in the business of selling such property. (b)out -of -City sales or out -of -State sales. (c)charges for delivery,installation,or other direct customer services as prescribed by Regulation. (d)charges for repair services as prescribed by Regulation, when separately charged and separately maintained in the books and records of the taxpayer. (e)(Reserved)SALES OF WARRANTY, MAINTENANCE, AND SERVICE CONTRACTS, WHEN SEPARATELY CHARGED AND SEPARATELY MAINTAINED IN THE BOOKS AND RECORDS OF THE TAXPAYER. (f)sales of prosthetics. (9)sales of income -producing capital equipment. (h)sales of rental equipment and rental supplies. (i)sales of mining and metallurgical supplies. (j)sales of motor vehicle fuel and use fuel which are subject to a tax imposed under the provisions of Article I or II, Chapter 9, Title 28, Arizona Revised Statutes; or sales of use fuel to a holder of a valid single trip use fuel tax permit issued under A.R.S. Section 28-1559, OR SALES OF NATURAL GAS OR LIQUEFIED PETROLEUM GAS USED TO PROPEL A MOTOR VEHICLE. (k)sales of tangible personal property to a construction contractor who holds a valid Privilege Tax License for engaging or continuing in the business of construction contracting where the tangible personal property sold is incorporated into any structure or improvement to real property as part of construction contracting activity. (I)(Reserved) SALES OF MOTOR VEHICLES TO NONRESIDENTS OF THIS STATE FOR USE OUTSIDE THIS STATE IF THE VENDOR SHIPS OR DELIVERS THE MOTOR VEHICLE TO A DESTINATION OUTSIDE THIS STATE. (m)sales of tangible personal property which directly enters into and becomes an ingredient or component •part of a product sold in the regular course of the business of job printing, manufacturing, or publication of newspapers, magazines, or other periodicals.Tangible personal property which is consumed or used up in a manufacturing, job printing, publishing, or production process is not an ingredient nor component part of a product. (n)sales made directly to the Federal government to the extent of: 9 (1)one hundred percent (100%) of the gross income derived from retail sales made by a manufacturer, modifier, assembler, or repairer. (2)fifty percent (50%) of the gross income derived from retail sales made by any other person. (o)sales to hotels, bars, restaurants, dining cars, lunchrooms, boarding houses, or similar establishments of articles consumed as food, drink, or condiment, whether simple, mixed, or compounded, where such articles are customarily prepared or served to patrons for consumption on or off the premises, where the purchaser is properly licensed and paying a tax under Section 8A-455 or the equivalent excise tax upon such income. (P) (q) sales of tangible personal property to any nonprofit primary health care facility, except when the property sold is for use in activities resulting in gross income from unrelated business income as that term is defined in 26 U.S.C. Section 512. Food purchased with food stamps provided through the Food Stamp Program established by the Food Stamp Act of 1977 (P.L. 95-113; 91 Stat. 958.7 U.S.C. Section 2011 Et Seq.)or purchased with food instruments issued under Section 17 of the Child Nutrition Act (P.L. 95-627; 92 Stat. 3603; and P.L. 99- 669; Section 4302), but only to the extent that food stamps or food instruments were actually used to purchase such food. (r)(Reserved) (1)(Reserved) (2)(Reserved) (3)(Reserved) (4)(Reserved) (s)sales of groundwater measuring devices required by A.R.S. Section 45-604. (t)(Reserved) (u)sales of aircraft acquired for use outside the State, as prescribed by regulation. (v)fliesenteel) SALES OF FOOD PRODUCTS BY PRODUCERS AS PROVIDED FOR BY A.R.S. SECTIONS 3-561, 3-562 AND 3-563. (w)(Reserved) (x)(Reserved) (y)(Reserved) (z)(Reserved) Section 8. Section 8A-480 of the City Tax Code of the City of Apache Junction is amended to read: Sec. 8A-480.Utility services. (a)The tax rate shall be at an amount equal to three percent (3%) of the gross income from the business activity upon every person engaging or continuing in the business of producing, providing, or furnishing utility services, including electricity, electric lights, current, power, gas (natural or artificial), or water to: (1)consumers or ratepayers who reside within the City. (2)(Reserved) 10 (b)Exclusion of certain sales of natural gas to a public utility.Notwithstanding the provisions of subsection (a) above, the gross income derived from the sale of natural gas to a public utility for the purpose of generation of power to be transferred by the utility to its ratepayers shall be considered a retail sale of tangible personal property subject to Sections 8A-460 and 8A-465, and not considered gross income taxable under this Section. (c)Resale utility services.Sales of utility services to another provider of the same utility services for the purpose of providing such utility services either to another properly licensed utility provider or directly to such purchaser's customers or ratepayers shall be exempt and deductible from the gross income subject to the tax imposed by this Section, provided that the purchaser is properly licensed by all applicable taxing jurisdictions to engage or continue in the business of providing utility services, and further provided that the seller maintains proper documentation, in a manner similar to that for sales for resale, of such transactions. (d)Tax credit offset for franchise fees.There shall be allowed as an offset any franchise fees paid to the City pursuant to the terms of a franchise agreement. However, such offset shall not be allowed against taxes imposed by any other Section of this Chapter.Such offsets shall not be deemed in conflict with or violation of subsection 8A -400(b). (e)The tax imposed by this Section shall not apply to sales of utility services to any nonprofit primary health care facility, except when sold for use in activities resulting in gross income from unrelated business income as that term is defined in 26 U.S.C. Section 512. (f) (g) THE TAX IMPOSED BY THIS SECTION SHALL NOT APPLY TO SALES OF NATURAL GAS OR LIQUEFIED PETROLEUM GAS USED TO PROPEL A MOTOR VEHICLE. THE TAX IMPOSED BY THIS SECTION SHALL NOT APPLY TO: (1)REVENUES RECEIVED BY A MUNICIPALLY OWNED UTILITY IN THE FORM OF FEES CHARGED TO PERSONS CONSTRUCTING RESIDENTIAL, COMMERCIAL OR INDUSTRIAL DEVELOPMENTS OR CONNECTING RESIDENTIAL, COMMERCIAL OR INDUSTRIAL DEVELOPMENTS TO A MUNICIPAL UTILITY SYSTEM OR SYSTEMS IF THE FEES ARE SEGREGATED AND USED ONLY FOR CAPITAL EXPANSION, SYSTEM ENLARGEMENT OR DEBT SERVICE OF THE UTILITY SYSTEM OR SYSTEMS. (2)REVENUES RECEIVED BY ANY PERSON OR PERSONS OWNING A UTILITY SYSTEM IN THE FORM OF REIMBURSEMENT OR CONTRIBUTION COMPENSATION FOR PROPERTY AND EQUIPMENT INSTALLED TO PROVIDE UTILITY ACCESS TO,ON OR ACROSS THE LAND OF AN ACTUAL UTILITY CONSUMER IF THE PROPERTY AND EQUIPMENT BECOME THE PROPERTY OF THE UTILITY.THIS EXCLUSION SHALL NOT EXCEED THE VALUE OF SUCH PROPERTY AND EQUIPMENT. Section 9. The notice which appears as an introduction to Article V and Section 8A-500 of the City Tax Code of the City of Apache Junction are amended to read: (NOTICE:Both the Department of Revenue and the city may perform audits of local taxpayers.Although many of the administrative procedures are the same, regardless of which entity is performing the audit, some differences will apply.To identify those differences, the words "State ADMINISTRATION AND Audits" or "Local Audits" appear following the title of the section.If the section applies to audits performed by both the state and the city, no notation appears.) 11 Sec.8A-500.Administration of this Chapter; rule making.(State ADMINISTRATION AND Audits) (a)The administration of this Chapter is vested in and exercised by the City of Apache Junction, and except as otherwise provided, and all payments shall be made to the City of Apache Junction. The City may, pursuant to an intergovernmental agreement, contract with the State of Arizona Department of Revenue for the administration of the tax.In such cases, "Tax Collector" shall also mean the Arizona Department of Revenue, when acting as agent in administering this tax. (b)The Tax Collector shall prescribe the forms and procedures necessary for the administration of the taxes imposed by this Chapter. (c)Except where such Regulations would conflict with administrative regulations adopted by the City Council or with provisions of this Chapter, all regulations on the Transaction Privilege Tax adopted by the Arizona Department of Revenue under the authority of A.R.S. Section 42- 105 shall be considered Regulations of this Chapter and enforceable as such. (d)TAXPAYERS SHALL BE SUBJECT TO THE STATE TAXPAYER BILL OF RIGHTS (A.R.S. § 42-139 ET SEQ.). Sec.8A-500.Administration of this Chapter; rule making.(Local Audits) (a)The administration of this Chapter is vested in and exercised by the City of Apache Junction, and except as otherwise provided, and all payments shall be made to the City of Apache Junction. The City may, pursuant to an intergovernmental agreement, contract with the State of Arizona Department of Revenue for the administration of the tax.In such cases, "Tax Collector" shall also mean the Arizona Department of Revenue, when acting as agent in administering this tax. (b)The Tax Collector shall prescribe the forms and procedures necessary for the administration of the taxes imposed by this Chapter. (c)Except where such Regulations would conflict with administrative regulations adopted by the City Council or with provisions of this Chapter, all regulations on the Transaction Privilege Tax adopted by the Arizona Department of Revenue under the authority of A.R.S. Section 42- 105 shall be considered Regulations of this Chapter and enforceable as such. (d)(RESERVED) Section 10.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-515 to read: Sec.8A-515.(RESERVED)(State ADMINISTRATION AND Audits) Sec.8A-515.DUTIES OF THE TAXPAYER PROBLEM RESOLUTION OFFICER.(Local Audits) (a)THE TAXPAYER PROBLEM RESOLUTION OFFICER SHALL ASSIST TAXPAYERS IN: (1)OBTAINING EASILY UNDERSTANDABLE TAX INFORMATION AND INFORMATION ON AUDITS, CORRECTIONS AND APPEALS PROCEDURES OF THE CITY. (2)ANSWERING QUESTIONS REGARDING PREPARING AND FILING THE RETURNS REQUIRED UNDER THIS CHAPTER. 12 (3)LOCATING DOCUMENTS FILED WITH OR PAYMENTS SUBMITTED TO THE TAX COLLECTOR BY THE TAXPAYER. (b)THE TAXPAYER PROBLEM RESOLUTION OFFICER SHALL ALSO: (1)RECEIVE AND EVALUATE COMPLAINTS OF IMPROPER,ABUSIVE OR INEFFICIENT SERVICE BY THE TAX COLLECTOR OR ANY OF HIS DESIGNEES, EMPLOYEES, OR AGENTS AND RECOMMEND TO THE CITY MANAGER OR, FOR A CITY WITHOUT A CITY MANAGER, THE CHIEF ADMINISTRATIVE OFFICER APPROPRIATE ACTION TO CORRECT SUCH SERVICE. (2)IDENTIFY POLICIES AND PRACTICES OF THE TAX COLLECTOR OR ANY OF HIS DESIGNEES, EMPLOYEES, OR AGENTS THAT MIGHT BE BARRIERS TO THE EQUITABLE TREATMENT OF TAXPAYERS AND RECOMMEND ALTERNATIVES TO THE CITY MANAGER OR, FOR A CITY WITHOUT A CITY MANAGER, THE CHIEF ADMINISTRATIVE OFFICER. (3)PROVIDE EXPEDITIOUS SERVICE TO TAXPAYERS WHOSE PROBLEMS ARE NOT RESOLVED THROUGH NORMAL CHANNELS. (4)NEGOTIATE WITH THE TAX COLLECTOR, HIS DESIGNEES, EMPLOYEES, OR AGENTS TO RESOLVE THE MOST COMPLEX AND SENSITIVE TAXPAYER PROBLEMS. (5)TAKE ACTION TO STOP OR PROHIBIT THE TAX COLLECTOR FROM TAKING AN ACTION AGAINST A TAXPAYER. (6)PARTICIPATE AND PRESENT TAXPAYERS'INTERESTS AND CONCERNS IN MEETINGS FORMULATING THE CITY'S POLICIES AND PROCEDURES UNDER AND INTERPRETATION OF THIS CHAPTER. (7)COMPILE DATA EACH YEAR ON THE NUMBER AND TYPE OF TAXPAYER COMPLAINTS AND EVALUATE THE ACTIONS TAKEN TO RESOLVE THOSE COMPLAINTS. (8)SURVEY TAXPAYERS EACH YEAR TO OBTAIN THEIR EVALUATION OF THE QUALITY OF SERVICE PROVIDED BY THE TAX COLLECTOR, HIS DESIGNEES, EMPLOYEES, AND AGENTS. (9)PERFORM OTHER FUNCTIONS WHICH RELATE TO TAXPAYER ASSISTANCE AS PRESCRIBED BY THE CITY MANAGER OR,FOR A CITY WITHOUT A CITY MANAGER, THE CHIEF ADMINISTRATIVE OFFICER. (c)ACTIONS TAKEN BY THE TAXPAYER PROBLEM RESOLUTION OFFICER MAY BE REVIEWED AND/OR MODIFIED ONLY BY THE CITY MANAGER OR, FOR A CITY WITHOUT A CITY MANAGER, THE CHIEF ADMINISTRATIVE OFFICER UPON REQUEST OF THE TAX COLLECTOR OR A TAXPAYER. (d)THE MAYOR AND COUNCIL OF THE CITY SHALL BE PROVIDED WITH A REPORT QUARTERLY WHICH IDENTIFIES: (1)ANY COMPLAINTS OF IMPROPER,ABUSIVE OR INEFFICIENT SERVICE RECEIVED BY THE TAXPAYER PROBLEM RESOLUTION OFFICER SINCE THE DATE OF THE LAST REPORT. (2)ANY RECOMMENDATIONS MADE, ACTION TAKEN OR SURVEYS OBTAINED BY THE TAXPAYER PROBLEM RESOLUTION OFFICER PURSUANT TO SUBSECTION (b)(1)-(9), ABOVE, SINCE THE DATE OF THE LAST REPORT. Section 11.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-516 to read: Sec.8A-516.(RESERVED)(State ADMINISTRATION AND Audits) 13 Sec.8A-516.TAXPAYER ASSISTANCE ORDERS.(Local Audits) (a)THE TAXPAYER PROBLEM RESOLUTION OFFICER, WITH OR WITHOUT A FORMAL WRITTEN REQUEST FROM A TAXPAYER, MAY ISSUE A TAXPAYER ASSISTANCE ORDER THAT SUSPENDS OR STAYS AN ACTION OR PROPOSED ACTION BY THE TAX COLLECTOR IF,IN THE PROBLEM RESOLUTION OFFICER'S DETERMINATION,A TAXPAYER IS SUFFERING OR WILL SUFFER A SIGNIFICANT HARDSHIP DUE TO THE MANNER IN WHICH THE TAX COLLECTOR IS ADMINISTERING THE TAX LAWS. (b)A TAXPAYER ASSISTANCE ORDER MAY REQUIRE THE TAX COLLECTOR TO RELEASE ANY LIEN PERFECTED UNDER THIS CHAPTER, OR CEASE ANY ACTION OR REFRAIN FROM TAKING ANY ACTION TO ENFORCE AGAINST THE TAXPAYER ANY SECTION OF THIS CHAPTER PENDING RESOLUTION OF THE ISSUE GIVING RISE TO THE TAXPAYER ASSISTANCE ORDER. (c)THE TAXPAYER PROBLEM RESOLUTION OFFICER, CITY MANAGER OR, FOR A CITY WITHOUT A CITY MANAGER, THE CHIEF ADMINISTRATIVE OFFICER MAY MODIFY, REVERSE OR RESCIND A TAXPAYER ASSISTANCE ORDER.A TAXPAYER ASSISTANCE ORDER IS BINDING ON THE TAX COLLECTOR UNTIL IT IS REVERSED OR RESCINDED. (d)THE RUNNING OF THE APPLICABLE STATUTE OF LIMITATIONS FOR ANY ACTION THAT IS THE SUBJECT OF A TAXPAYER ASSISTANCE ORDER IS SUSPENDED FROM THE DATE THE TAXPAYER APPLIES FOR THE ORDER OR THE DATE THE ORDER IS ISSUED, WHICHEVER IS EARLIER, UNTIL THE ORDER'S EXPIRATION DATE, MODIFICATION DATE OR RECISION DATE, IF ANY.INTEREST THAT WOULD OTHERWISE ACCRUE ON AN OUTSTANDING TAX OBLIGATION IS NOT AFFECTED BY THE ISSUANCE OF A TAXPAYER ASSISTANCE ORDER. (e)A TAXPAYER ASSISTANCE ORDER MAY NOT BE USED: (1)TO CONTEST THE MERITS OF A TAX LIABILITY. (2)TO SUBSTITUTE FOR INFORMAL PROTEST PROCEDURES OR ADMINISTRATIVE OR JUDICIAL PROCEEDINGS TO REVIEW A DEFICIENCY ASSESSMENT, COLLECTION ACTION OR DENIAL OF A REFUND CLAIM. Section 12.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-517 to read: Sec.8A-517.(RESERVED)(State ADMINISTRATION AND Audits) Sec.8A-517.BASIS FOR EVALUATING EMPLOYEE PERFORMANCE.(Local Audits) (a)THE TAX COLLECTOR SHALL SOLICIT EVALUATIONS FROM TAXPAYERS AND INCLUDE SUCH EVALUATIONS IN THE PERFORMANCE APPRAISALS OF HIS EMPLOYEES, WHERE APPLICABLE. (b)THE TAX COLLECTOR SHALL NOT EVALUATE AN EMPLOYEE ON THE BASIS OF TAXES ASSESSED OR COLLECTED BY THAT EMPLOYEE. 14 Section 13.Section 8A-540 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-540.Interest and civil penalties. Any taxpayer who shall have failed to timely pay any taxes imposed by this Chapter, or file a report for the same in a timely manner, or fail or refuse to allow examination of records by the Tax Collector, shall be subject to any interest or civil penalties on such tax in like manner as such interest and penalties are provided in A.R.S. Sections 42-134 and 42-136 for the State Transaction Privilege Tax. (a)(Reserved) (b)(Reserved) (c)(Reserved) (d)(Reserved) (e)(Reserved) (f)(Reserved) (g)(Reserved) (h)(RESERVED) (i)(RESERVED) Section 14.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-541 to read: Sec.8A-541.(RESERVED) (State ADMINISTRATION AND Audits) Sec.8A-541. ERRONEOUS ADVICE OR MISLEADING STATEMENTS BY THE TAX COLLECTOR; ABATEMENT OF PENALTIES AND INTEREST; DEFINITION.(Local Audits) (a)NOTWITHSTANDING SECTION 8A -540(a),NO INTEREST OR PENALTY MAY BE ASSESSED ON AN AMOUNT ASSESSED AS A DEFICIENCY IF EITHER: (1)THE DEFICIENCY ASSESSED IS DIRECTLY ATTRIBUTABLE TO ERRONEOUS WRITTEN ADVICE FURNISHED TO THE TAXPAYER BY AN EMPLOYEE OF THE CITY ACTING IN AN OFFICIAL CAPACITY IN RESPONSE TO A SPECIFIC REQUEST FROM THE TAXPAYER AND NOT FROM THE TAXPAYER'S FAILURE TO PROVIDE ADEQUATE OR ACCURATE INFORMATION. (2)ALL OF THE FOLLOWING ARE TRUE: (A)A TAX RETURN FORM PREPARED BY THE TAX COLLECTOR CONTAINS A STATEMENT THAT, IF FOLLOWED BY A TAXPAYER, WOULD CAUSE THE TAXPAYER TO MISAPPLY THIS CHAPTER. (B)THE TAXPAYER REASONABLY RELIES ON THE STATEMENT. (C)THE TAXPAYER'S UNDERPAYMENT DIRECTLY RESULTS FROM THIS RELIANCE. (b)EACH EMPLOYEE OF THE TAX COLLECTOR, AT THE TIME ANY ORAL ADVICE IS GIVEN TO ANY PERSON, SHALL INFORM THE PERSON THAT THE TAX COLLECTOR IS NOT BOUND BY SUCH ORAL ADVICE. 15 (c)FOR PURPOSES OF THIS SECTION "TAX RETURN FORM"INCLUDES THE INSTRUCTIONS THAT THE TAX COLLECTOR PREPARES FOR USE WITH THE TAX RETURN FORM. Section 15.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-546 to read: Sec.8A-546.(RESERVED) (State ADMINISTRATION AND Audits) Sec.8A-546.CLOSING AGREEMENTS IN CASES OF EXTENSIVE TAXPAYER MISUNDERSTANDING OR MISAPPLICATION; APPROVAL; RULES.(Local Audits) (a)IF THE TAX COLLECTOR DETERMINES THAT NONCOMPLIANCE WITH TAX OBLIGATIONS RESULTS FROM EXTENSIVE MISUNDERSTANDING OR MISAPPLICATION OF PROVISIONS OF THIS CHAPTER IT MAY ENTER INTO CLOSING AGREEMENTS WITH THOSE TAXPAYERS UNDER THE FOLLOWING TERMS AND CONDITIONS: (1)EXTENSIVE MISUNDERSTANDING OR MISAPPLICATION OF THE TAX LAWS OCCURS IF THE TAX COLLECTOR DETERMINES THAT MORE THAN SIXTY PERCENT (60%) OF THE PERSONS IN THE AFFECTED CLASS HAVE FAILED TO PROPERLY ACCOUNT FOR THEIR TAXES OWING TO THE SAME MISUNDERSTANDING OR MISAPPLICATION OF THE TAX LAWS. (2)THE TAX COLLECTOR SHALL PUBLICLY DECLARE THE NATURE OF THE POSSIBLE MISAPPLICATION AND THE PROPOSED DEFINITION OF THE CLASS OF AFFECTED TAXPAYERS AND SHALL CONDUCT A PUBLIC HEARING TO HEAR TESTIMONY REGARDING THE EXTENT OF THE MISAPPLICATION AND THE DEFINITION OF THE AFFECTED CLASS. (3)IF, AFTER THE PUBLIC HEARING, THE TAX COLLECTOR DETERMINES THAT A CLASS OF AFFECTED TAXPAYERS HAS FAILED TO COMPLY WITH THEIR TAX OBLIGATIONS BECAUSE OF EXTENSIVE MISUNDERSTANDING OR MISAPPLICATION OF THE TAX LAWS IT SHALL ISSUE A TAX RULING ANNOUNCING THAT FINDING AND PUBLISH THE RULING IN A NEWSPAPER OF GENERAL CIRCULATION IN THE CITY AND THROUGH THE NEXT TWO MODEL CITY TAX CODE UPDATES. (4)A CLOSING AGREEMENT UNDER THIS SECTION MAY ABATE SOME OR ALL OF THE PENALTIES,INTEREST AND TAX THAT TAXPAYERS HAVE FAILED TO REMIT,OR THE AGREEMENT MAY PROVIDE FOR THE PROSPECTIVE TREATMENT OF THE MATTER AS TO THE CLASS OF AFFECTED TAXPAYERS. ALL TAXPAYERS IN THE CLASS SHALL BE OFFERED THE OPPORTUNITY TO ENTER INTO A SIMILAR AGREEMENT FOR THE SAME TAX PERIODS. (5)TAXPAYERS IN THE AFFECTED CLASS WHO HAVE PROPERLY ACCOUNTED FOR THEIR TAX OBLIGATIONS FOR THESE TAX PERIODS SHALL BE OFFERED THE OPPORTUNITY TO ENTER INTO AN EQUIVALENT CLOSING AGREEMENT PROVIDING FOR A PRO RATA CREDIT OR REFUND OF THEIR TAXES PREVIOUSLY PAID. (6)THE CLOSING AGREEMENT SHALL REQUIRE THE TAXPAYERS TO PROPERLY ACCOUNT FOR AND PAY SUCH TAXES IN THE FUTURE.IF A TAXPAYER FAILS TO ADHERE TO SUCH A REQUIREMENT,THE CLOSING AGREEMENT IS VOIDABLE BY THE TAX COLLECTOR AND HE MAY ASSESS THE TAXPAYER FOR THE DELINQUENT TAXES.THE TAX COLLECTOR MAY ISSUE SUCH A PROPOSED ASSESSMENT WITHIN SIX MONTHS AFTER THE DATE THAT HE DECLARES THAT CLOSING AGREEMENT VOID OR WITHIN THE PERIOD PRESCRIBED BY SECTION 8A-550 OF THIS CHAPTER. 16 (b)BEFORE ENTERING INTO CLOSING AGREEMENTS PURSUANT TO THIS SECTION, THE TAX COLLECTOR SHALL SECURE SUCH APPROVAL AS REQUIRED BY CHARTER, ORDINANCE OR ADMINISTRATIVE REGULATION. (c)AFTER A CLOSING AGREEMENT HAS BEEN SIGNED PURSUANT TO THIS SECTION, IT IS FINAL AND CONCLUSIVE EXCEPT ON A SHOWING OF FRAUD, MALFEASANCE OR MISREPRESENTATION OF A MATERIAL FACT.THE CASE SHALL NOT BE REOPENED AS TO THE MATTERS AGREED UPON OR THE AGREEMENT SHALL NOT BE MODIFIED BY ANY OFFICER, EMPLOYEE OR AGENT OF THE CITY.THE AGREEMENT OR ANY DETERMINATION, ASSESSMENT, COLLECTION, PAYMENT ABATEMENT, REFUND OR CREDIT MADE PURSUANT TO THE AGREEMENT SHALL NOT BE ANNULLED, MODIFIED, SET ASIDE OR DISREGARDED IN ANY SUIT, ACTION OR PROCEEDING. (d)THE TAX COLLECTOR SHALL REPORT IN WRITING ITS ACTIVITIES UNDER THIS SECTION TO THE MAYOR AND CITY COUNCIL ON OR BEFORE FEBRUARY 1 OF EACH YEAR. Section 16. Section 8A-555 of the City Tax Code of the City of Apache Junction is amended to read: Sec. 8A-555. Tax Collector may examine books and other records; failure to provide records. (a)The Tax Collector may require the taxpayer to provide and may examine any books, records, or other documents of any person who, in the opinion of the Tax Collector, might be liable for any tax under this Chapter, for any periods available to him under Section 8A-550. (b)(Reserved) (c)(Reserved) (d)The Tax Collector may use any generally accepted auditing procedures, including sampling techniques, to determine the correct tax liability of any taxpayer.The only responsibility 1-Ite Tax Collector is SHALL ENSURE that the procedures used are in accordance tivith with generally accepted auditing standards. (e)The fact that the taxpayer has not maintained or provided such books and records which the Tax Collector considers necessary to determine the tax liability of any person does not preclude the Tax Collector from making any assessment.In such cases, the Tax Collector is authorized to use estimates, projections, or samplings, to determine the correct tax.The provisions of Section 8A -545(b), concerning estimates, shall apply. (f)(Reserved) Section 17.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-556 to read: Sec.8A-556.(RESERVED) (State ADMINISTRATION AND Audits) Sec.8A-556.NO ADDITIONAL AUDITS OR PROPOSED ASSESSMENTS; EXCEPTIONS.(Local Audits) (a)ONCE THE TAX COLLECTOR COMPLETES AN EXAMINATION AUTHORIZED BY SECTION 8A-555 AND A WRITTEN NOTICE OF THE DETERMINATION OF A DEFICIENCY HAS 17 BEEN ISSUED TO THE TAXPAYER PURSUANT TO SECTION 8A -545(a) OR 8A -555(f), THE TAXPAYER'S LIABILITY FOR THE TIME PERIOD SUBJECTED TO THE EXAMINATION IS FIXED AND DETERMINED, AND NO ADDITIONAL AUDIT OR EXAMINATION MAY BE CONDUCTED BY THE TAX COLLECTOR WITH RESPECT TO SUCH TIME PERIOD EXCEPT UNDER THE FOLLOWING CIRCUMSTANCES. (1)IF A TAXPAYER FILES A CLAIM FOR REFUND UNDER SECTION 8A-560, THE TAX COLLECTOR MAY CONDUCT AN EXAMINATION LIMITED TO THE ISSUES PRESENTED IN THE REFUND CLAIM. (2)IF THE TAXPAYER FAILED TO DISCLOSE MATERIAL INFORMATION DURING THE INITIAL EXAMINATION,FALSIFIED BOOKS OR RECORDS,OR OTHERWISE ENGAGED IN CONDUCT WHICH PREVENTED THE TAX COLLECTOR FROM CONDUCTING AN ACCURATE EXAMINATION.THE APPLICABILITY OF THIS SUBSECTION, AND THE TAX COLLECTOR'S RIGHT TO PROCEED THEREUNDER, MAY BE RAISED AND CONTESTED BY THE TAXPAYER IN A SUBSEQUENT ADMINISTRATIVE REVIEW BROUGHT PURSUANT TO SECTION 8A-570. (b)AN AUDIT OR EXAMINATION CONDUCTED BY ANY OTHER TAXING JURISDICTION WILL NOT PRECLUDE THE TAX COLLECTOR FROM CONDUCTING AN AUDIT OR EXAMINATION FOR THE SAME TIME PERIOD. (c)IF THE TAX COLLECTOR ISSUES A NOTICE OF DEFICIENCY PURSUANT TO EITHER SECTION 8A -545(a) OR SECTION 8A -555(f), THE TAX COLLECTOR MAY NOT INCREASE THE PROPOSED DEFICIENCY EXCEPT IN ONE OR MORE OF THE FOLLOWING CIRCUMSTANCES: (1)THE TAXPAYER MADE A MATERIAL MISREPRESENTATION OF FACT. (2)THE TAXPAYER FAILED TO DISCLOSE A MATERIAL FACT. (3)THE TAX COLLECTOR SUBMITTED A WRITTEN REQUEST FOR INFORMATION AND THE TAXPAYER, DESPITE POSSESSING OR HAVING ACCESS TO SUCH INFORMATION,FAILED TO PROVIDE IT WITHIN 60 DAYS AS REQUIRED BY SECTION 8A -555(c). (4)AFTER ISSUING THE NOTICE OF DETERMINATION OF DEFICIENCY BUT BEFORE THE DEFICIENCY BECAME FINAL,THE ARIZONA TAX COURT,COURT OF APPEALS OR SUPREME COURT ISSUED A DECISION, THE APPLICABILITY OF WHICH CAUSES THE DEFICIENCY INITIALLY PROPOSED TO INCREASE. Section 18. Section 8A-560 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-560.Erroneous payment of tax; credits and refunds;limitations. (a)Except as provided in Section 8A-565, the period within which a claim for credit may be filed, •or refund allowed or made if no claim is filed, shall be as provided in A.R.S. Sections 42-115 and 42-129. (b)(Reserved) (c)(Reserved) (d)(Reserved). INTEREST SHALL BE ALLOWED AT THE RATE SET FORTH IN SECTION 8A- 540(a) ON ANY CREDIT OR REFUND AUTHORIZED PURSUANT TO THE PROVISIONS OF THIS CHAPTER.INTEREST SHALL BE CALCULATED FROM THE TIME OF THE CLAIM MADE TO THE CITY BY THE TAXPAYER. (e)(Reserved) 18 (f) (9) The denial of a refund by the Tax Collector is subject to the provisions of A.R.S. Section 42- 130. Any refund paid under the provisions of this Section shall be paid from the Privilege Tax revenue accounts. Section 19. Section 8A-565 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-565. Payment of tax BY THE INCORRECT TAXPAYER OR to the incorrect Arizona city or town. (a)WHEN IT IS DETERMINED THAT TAXES HAVE BEEN REPORTED AND PAID TO THE CITY BY THE WRONG TAXPAYER,ANY TAXES ERRONEOUSLY PAID SHALL BE TRANSFERRED BY THE CITY TO THE PRIVILEGE TAX ACCOUNT OF THE PERSON WHO ACTUALLY OWES AND SHOULD HAVE PAID SUCH TAXES, PROVIDED THAT THE CITY RECEIVES AN ASSIGNMENT AND WAIVER SIGNED BY BOTH THE PERSON WHO ACTUALLY PAID THE TAX AND THE PERSON WHO SHOULD HAVE PAID THE TAX. (b)AN ASSIGNMENT AND WAIVER PROVIDED UNDER THIS SECTION, MUST: (1)IDENTIFY THE NAME AND CITY PRIVILEGE LICENSE NUMBER OF THE PERSON WHO ERRONEOUSLY PAID THE TAX AND THE PERSON WHO SHOULD HAVE PAID THE TAX. (2)PROVIDE THAT THE PERSON WHO ERRONEOUSLY PAID THE TAX WAIVES ANY RIGHT SUCH PERSON MAY HAVE TO A REFUND OF THE TAXES ERRONEOUSLY PAID. (3)AUTHORIZE THE CITY TREASURER TO TRANSFER THE ERRONEOUSLY PAID TAX TO THE PRIVILEGE TAX ACCOUNT OF THE PERSON WHO SHOULD HAVE PAID THE TAX. -a-)(c)When it is determined that taxes have been reported and paid to the wrong Arizona city or town, a-reftthtFer-ass-ess-m-errt SUCH TAXES shall be made REMITTED to the correct city or town,PROVIDED THAT THE CITY OR TOWN TO WHOM THE TAXES WERE ERRONEOUSLY PAID RECEIVES AN ASSIGNMENT AND WAIVER SIGNED BY BOTH THE PERSON WHO ACTUALLY PAID THE TAX AND THE PERSON WHO SHOULD HAVE PAID THE TAX.WHERE THE PERSON WHO ACTUALLY PAID THE TAX AND THE PERSON WHO SHOULD HAVE PAID THE TAX ARE ONE AND THE SAME, NO ASSIGNMENT AND WAIVER NEED BE PROVIDED.- --...•-'.••-•• -..- forty-e;ght (40) men rthwierel-prierr-t-Lrt-ht-eferte-H uvs r-ginvs n'eti a -S ef H re taxes due. The City shall neither pay nor charge any interest or penalty on any overpayment or underpayment except such interest and penalty actually paid by the taxpayer relating to such tax. LII e .4f11111 911-711 tifr)-(d)THIS SECTION IN NO WAY LIMITS OR RESTRICTS THE APPLICABILITY OF ANY REMEDIES WHICH MAY OTHERWISE BE AVAILABLE UNDER A.R.S. SECTION 42-1452. The limitations and procedures set forth in A.R.S.Section 42-1452 shall apply to all payments under this Section. te-}(e)When reference is made in this Section to THIS CITY OR an Arizona city or town, and payments made to or requested from strell THIS CITY OR AN ARIZONA city or town, the provisions shall be applicable to the Arizona Department of Revenue when it is acting for or on behalf of THIS CITY OR an Arizona city or town. 19 Section 20. Section 8A-567 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-567.Allocation nexus.(Reserved) tit)* tbt tet arr-cqtrivalcrit-exci3e tax-upon the transaction, but the order was received at a 11 D U M t-8 EFEIVETID CFID LJI L U LIU tem bicycle, motorcycle, truck, aircraft, boat, tractor, forklift, or any other equipment that can ETETWEl-e7 GrVI117 LIU E'retrns-23-3 E ,ErM Riten12 111-81frflitti=311-611-111-Mttr :ustornE city or town shall have the right to half of the actual tax collected, even if the rate at...........WIttefl-S-thefl-ta)tVtaa-tBfle Piftrial) a ate ettfte such a sale, to be determined by the tax rate of the city or town of the seller's permanent business location. fey Claim, payment, a etteettern a etifYetitet ties -a Section 21. Section 8A-570 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-570.Administrative review; petition for hearing or for redetermination; hearing or redetermination; finality of order.(State ADMINISTRATION AND Audits) (a) ti* Closing agreements between the Tax Collector and a taxpayer have no force of law unless made in accordance with the provisions of A.R.S. Section 42-123. et(b)Administrative review. (1)Petitions of appeal shall be made to, and hearings shall be conducted by, the Arizona Department of Revenue, in accordance with the provisions of A.R.S. Section 42-122, as modified by Section 8A-571. (2)(Reserved) (3 )(Reserved) 20 (4)(Reserved) (5)Hearings shall be held by the Arizona Department of Revenue in accordance with the provisions of A.R.S. Section 42-122.The Department's decision may be appealed to the State Board of Tax Appeals, in accordance with the provisions of A.R.S. Section 42-124. (6)(Reserved) (7)(Reserved) (8)(RESERVED) f (c)(Reserved) fet(d)(Reserved) (e)TAXPAYERS SHALL BE SUBJECT TO THE STATE TAXPAYER BILL OF RIGHTS (A.R.S. § 42-139 ET. SEQ.). Sec.8A-570.Administrative review; petition for hearing or for redetermination; hearing or redetermination; finality of order.(Local Audits) (a)Informal Conference.A taxpayer shall have the right to discuss any proposed assessment with the auditor prior to the issuance of any assessment, but any such informal conference is not required for the taxpayer to file a petition for administrative review. n11:1=111=117X111113enf2112IVIZ ax coliector and credited to the taxpayer as though not made under protest. {e -(b)Administrative Review. (1)Filing a Petition.Other than in the case of a jeopardy assessment, a taxpayer may contest the applicability or amount of tax, penalty, or interest imposed upon or paid by him pursuant to this Chapter by filing a petition for a hearing or for redetermination with the Tax Collector as set forth below: (A)within forty-five (45)days of receipt by the taxpayer of notice of a determination by the Tax Collector that a tax, penalty, or interest amount is due, or that a request for refund or credit has been denied; or (B)by voluntary payment of any contested amount when accompanied by a timely filed return and a petition requesting a refund of the protested portion of said payment; or (C)by petition accompanying a timely filed return contesting an amount reported but not paid; or (D)by petition requesting review of denial of waiver of penalty as provided in subsection 8A-54-0(-fy 540(g). (2)Extension to file a petition.In all cases, the taxpayer may request only one (1) extension from the Tax Collector. Such request must be in writing, state the reasons for the requested delay and time of delay requested, and must be filed with the Tax Collector within the period allowed above for originally filing a petition.The Tax Collector shall allow such extension to file a petition, when such written request has been properly and timely made by the taxpayer, but such extension shall not exceed forty-five (45) days beyond the time provided for originally filing a petition. (3 )Requirements for petition. (A)The petition shall be in writing and shall set forth the reasons why any correction, abatement,or refund should be granted,and the amount of reduction or refund requested.The petition may be amended at any time prior to the time the taxpayer rests his case at the hearing or such time as the Hearing Officer allows for submitting of amendments in cases of 21 redeterminations without hearings.The Hearing Officer may require that amendments be in writing, and in that case, he shall provide a reasonable period of time to file the amendment.The Hearing Officer shall provide a reasonable period of time for the Tax Collector to review and respond to the petition and to any written amendments. (B)The taxpayer, as part of the petition, may request a hearing which shall be granted by the Hearing Officer.If no request for hearing is made the petition shall be considered to be submitted for decision by the Hearing Officer on the matters contained in the petition and in any reply made by the Tax Collector. (C)The provisions of this Section are exclusive, and no petition seeking any correction, abatement, or refund shall be considered unless the petition is timely and properly filed under the Section. (4)Transmittal to Hearing Officer.The City of Apache Junction shall designate a Hearing Officer, who may be other than an employee of the City.The Tax Collector, if designated to receive petitions, shall forward any petition to the Hearing Officer within ten (10) days after receipt, accompanied by documentation as to timeliness. In cases where the Hearing Officer determines that the petition is not timely or not in proper form, he shall notify both the taxpayer and the Tax Collector; and in cases of petitions not in proper form only, the Hearing Officer may, at SHALL provide the taxpayer with an extension up to forty-five (45) days to correct the petition. (8 )Hearings shall be conducted by a Hearing Officer and shall be continuous until the Hearing Officer closes the record.The taxpayer may be heard in person or by his authorized representative at such hearing.Hearings shall be conducted informally as to the order of proceeding and presentation of evidence. The Hearing Officer shall admit evidence over hearsay objections where the offered evidence has substantial probative value and reliability.Further, copies of records and documents prepared in the ordinary course of business may be admitted,without objection as to foundation, but subject to argument as to weight, admissibility, and authenticity. Summary accounting records may be admitted subject to satisfactory proof of the reliability of the summaries.In all cases, the decision of the Hearing Officer shall be made solely upon substantial and reliable evidence.All expenses incurred in the hearing shall be paid by the party incurring the same. (6)Redeterminations upon a "petition for redetermination"shall follow the same conditions, except that no oral hearing shall be held. (7 )Hearing Ruling.In either case, the Hearing Officer shall issue his ruling not later than forty-five (45) days after the close of the record by the Hearing Officer. (8 )NOTICE OF REFUND OR ADJUSTED ASSESSMENT.WITHIN SIXTY (60) DAYS OF THE ISSUANCE OF THE HEARING OFFICER'S DECISION, THE TAX COLLECTOR SHALL ISSUE TO THE TAXPAYER EITHER A NOTICE OF REFUND OR AN ADJUSTED ASSESSMENT RECALCULATED TO CONFORM TO THE HEARING OFFICER'S DECISION. fd(c)Stipulations that future tax is also protested.A taxpayer may enter into a stipulation with the Tax Collector that future taxes of similar nature are also at issue in any protest or appeal. However, unless such stipulation is made, it is presumed that the protest or appeal deals solely and exclusively with the tax specifically protested and no other.When a taxpayer enters into such a stipulation with the Tax Collector that future taxes of similar nature will be included in any redetermination, hearing, or court case, it is the burden of that taxpayer to identify, segregate, and keep record of such income or protested taxable amount in his books and records in the same manner as the taxpayer is required to segregate exempt income. te(d)When an assessment is final. (1)If a request for administrative review and petition for hearing or redetermination of an assessment made by the Tax Collector is not filed within the period required by 22 subsection te(b)above,such person shall be deemed to have waived and abandoned the right to question the amount determined to be due and any tax, interest, or penalty determined to be due shall be final as provided in subsections 8A -545(a) and 8A -555(f). (2)The decision made by the Hearing Officer upon administrative review by hearing or redetermination shall become final thirty (30) days after notice by the Tax Collector THE TAXPAYER RECEIVES THE NOTICE OF REFUND OR ADJUSTED ASSESSMENT REQUIRED BY SUBSECTION (b)(8)ABOVE,UNLESS THE TAXPAYER appeals the order or decision in the manner provided in Section 8A-575. Acity—ttrx—d-tre—sitel—lle—paid within thirty (30)days after such notice either i l IllIIILJI ILIIIV IJI L11 PUG!Lit U GI17 tre (e)THE PROVISIONS OF THE STATE TAXPAYER BILL OF RIGHTS (A.R.S. SECTION 42-139 ET. SEQ.) SHALL NOT APPLY. Section 22.Article V of the City Tax Code of the City of Apache Junction is _amended by adding Section 8A-572 to read: Sec.8A-572.(RESERVED) (State ADMINISTRATION AND Audits) Sec.8A-572.EXPEDITED REVIEW OF JEOPARDY ASSESSMENTS.(Local Audits) (a)WITHIN THIRTY (30)DAYS AFTER THE DAY ON WHICH THE TAX COLLECTOR FURNISHES THE WRITTEN NOTICE REQUIRED BY SECTION 8A -571(a), THE TAXPAYER, PURSUANT TO SECTION 8A-570, MAY REQUEST THE TAX COLLECTOR TO REVIEW THE ACTION TAKEN.WITHIN FIFTEEN (15) DAYS AFTER THE REQUEST FOR REVIEW, THE TAX COLLECTOR SHALL DETERMINE WHETHER BOTH THE JEOPARDY DETERMINATION AND THE AMOUNT ASSESSED ARE REASONABLE. (b)WITHIN THIRTY (30) DAYS AFTER THE TAX COLLECTOR NOTIFIES THE TAXPAYER OF THE DETERMINATION HE REACHED PURSUANT TO SUBSECTION (a) ABOVE, THE TAXPAYER MAY BRING A CIVIL ACTION IN THE APPROPRIATE COURT.IF THE TAXPAYER SO REQUESTS, THE CITY SHALL STIPULATE TO AN ACCELERATED AND EXPEDITED RESOLUTION OF THE CIVIL ACTION.IF THE COURT DETERMINES THAT EITHER THE JEOPARDY DETERMINATION OR THE AMOUNT ASSESSED IS UNREASONABLE, THE COURT MAY ORDER THE TAX COLLECTOR TO ABATE THE ASSESSMENT, TO REDETERMINE ANY PART OF THE AMOUNT ASSESSED OR TO TAKE SUCH OTHER ACTION AS THE COURT FINDS TO BE APPROPRIATE. A DETERMINATION MADE BY THE COURT UNDER THIS SUBSECTION IS FINAL EXCEPT AS PROVIDED IN ARIZONA REVISED STATUTES SECTION 12-170. Section 23. Section 8A-575 of the City Tax Code of the City of Apache Junction is amended to read: Sec.8A-575.Judicial review.(State ADMINISTRATION AND Audits) No change was made to this section. 23 Sec.8A-575.Judicial review.(Local Audits) (a)A taxpayer,=••-•-;, •-• , .' -— -• -• • •-• - ••,; bring MAY SEEK JUDICIAL REVIEW OF ALL OR ANY PART OF A HEARING OFFICER'S DECISION BY INITIATING AN action against the City in the appropriate Court of this County for recoveryof A TAXPAYER IS NOT REQUIRED TO PAY ANY TAX, PENALTY, OR INTEREST UPHELD BY THE HEARING OFFICER BEFORE SEEKING SUCH JUDICIAL REVIEW. nttgl-IIMVIITET rf@ltatt%tterftEltrIM 7111 (b)The Tax Collector may seek judicial review of all or any part of a Hearing Officer's decision by initiating an action in the appropriate Court of this County. (c)An action for judicial review sita-if CAN not be commenced BY EITHER THE TAXPAYER OR THE TAX COLLECTOR more than thirty (30) days after receipt of notice by the taxpayer OF NOTICE of any refund or assessment recalculated or reduced to conform to the Hearing Officer's decision, UNLESS THE TIME TO COMMENCE SUCH AN ACTION IS EXTENDED IN WRITING SIGNED BY BOTH THE TAXPAYER AND THE TAX COLLECTOR.Failure to bring the action within thirty (30) days OR SUCH OTHER TIME AS IS AGREED UPON IN WRITING shall constitute a waiver of any right to judicial review, except as provided in subsection (f) below. (d)The court shall consider only tho3 yt vul lua anu jaauw -0 OwtIU W i n II l c ti tivi ui tuci • •• •,•;•- =;• • •'•'HEAR AND DETERMINE THE APPEAL AS A TRIAL DE NOVO; HOWEVER, THE TAX COLLECTOR CANNOT RAISE IN THE COURT ANY GROUNDS OR BASIS FOR THE ASSESSMENT NOT ASSERTED BEFORE the Hearing Officer..- •- =-•-••-.• . '••- '• .- •'• • -NOTHING IN THIS SUBSECTION,HOWEVER,SHALL PRECLUDE THE TAX COLLECTOR FROM RESPONDING TO ANY ARGUMENTS WHICH ARE RAISED BY THE TAXPAYER IN THE APPEAL. (e)The issuance of an adjusted or corrected assessment or notice of refund due to the taxpayer, where made by the Tax Collector pursuant to the decision of the Hearing Officer, shall not be deemed an acquiescence by the City or the Tax Collector in said decision, nor shall it constitute a bar or estoppel to the institution of an action or counterclaim by the City to recover any amounts claimed to be due to it by virtue of the original assessment. (f)After the initiation of any action in the appropriate court by either party, the opposite party may file such counterclaim as would be allowed pursuant to the Arizona Rules of Civil Procedure. Section 24.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-578 to read: Sec.8A-578.(RESERVED) (State ADMINISTRATION AND Audits) Sec.8A-578.REIMBURSEMENT OF FEES AND OTHER COSTS; DEFINITIONS.(Local Audits) (a)A TAXPAYER WHO IS A PREVAILING PARTY MAY BE REIMBURSED FOR REASONABLE FEES AND OTHER COSTS RELATED TO ANY ADMINISTRATIVE PROCEEDING BROUGHT BY THE TAXPAYER PURSUANT TO SECTION 8A -570(b).FOR PURPOSES OF THIS SECTION, A TAXPAYER IS CONSIDERED TO BE THE PREVAILING PARTY ONLY IF BOTH OF THE FOLLOWING ARE TRUE: (1)THE TAX COLLECTOR'S POSITION WAS NOT SUBSTANTIALLY JUSTIFIED. 24 (2)THE TAXPAYER PREVAILS AS TO THE MOST SIGNIFICANT ISSUE OR SET OF ISSUES. (b)REIMBURSEMENT UNDER THIS SECTION MAY BE DENIED IF ANY OF THE FOLLOWING CIRCUMSTANCES APPLY: (1)DURING THE COURSE OF THE PROCEEDING THE TAXPAYER UNDULY AND UNREASONABLY PROTRACTED THE FINAL RESOLUTION OF THE MATTER. (2)THE REASON THAT THE TAXPAYER PREVAILED IS DUE TO AN INTERVENING CHANGE IN THE APPLICABLE LAW. (c)THE TAXPAYER SHALL PRESENT AN ITEMIZATION OF THE REASONABLE FEES AND OTHER COSTS TO THE TAXPAYER PROBLEM RESOLUTION OFFICER WITHIN THIRTY (30)DAYS AFTER RECEIPT BY THE TAXPAYER OF A NOTICE OF REFUND OR RECALCULATED ASSESSMENT ISSUED BY THE TAX COLLECTOR PURSUANT TO SECTION 8A -570(b)(8).THE TAXPAYER PROBLEM RESOLUTION OFFICER SHALL DETERMINE THE VALIDITY OF THE FEES AND OTHER COSTS WITHIN THIRTY (30) DAYS AFTER RECEIVING THE ITEMIZATION.THE TAXPAYER PROBLEM RESOLUTION OFFICER'S DECISION IS CONSIDERED A FINAL DECISION.EITHER THE TAXPAYER OR THE TAX COLLECTOR MAY SEEK JUDICIAL REVIEW OF THE TAXPAYER PROBLEM RESOLUTION OFFICER'S DECISION.AN ACTION FOR JUDICIAL REVIEW, HOWEVER, SHALL NOT BE COMMENCED MORE THAN THIRTY (30) DAYS AFTER RECEIPT OF THE RESOLUTION OFFICER'S DECISION. (d)IN THE EVENT JUDICIAL REVIEW IS NOT SOUGHT PURSUANT TO SUBSECTION (c) ABOVE, THE CITY SHALL PAY THE FEES AND OTHER COSTS AWARDED AS PROVIDED IN THIS SECTION WITHIN THIRTY DAYS AFTER DEMAND BY A PERSON WHO HAS RECEIVED AN AWARD PURSUANT TO THIS SECTION. (e)REIMBURSEMENT TO A TAXPAYER UNDER THIS SECTION SHALL NOT EXCEED TWENTY THOUSAND DOLLARS OR ACTUAL MONIES SPENT, WHICHEVER IS LESS.THE REIMBURSABLE ATTORNEY OR REPRESENTATIVE FEES SHALL NOT EXCEED ONE HUNDRED DOLLARS PER HOUR OR ACTUAL MONIES SPENT, WHICHEVER IS LESS, UNLESS THE TAXPAYER PROBLEM RESOLUTION OFFICER DETERMINES THAT AN INCREASE IN THE COST OF LIVING OR A SPECIAL FACTOR SUCH AS THE LIMITED AVAILABILITY OF QUALIFIED ATTORNEYS OR REPRESENTATIVES FOR THE PROCEEDING INVOLVED JUSTIFIES A HIGHER FEE. (f)FOR PURPOSES OF THIS SECTION "REASONABLE FEES AND OTHER COSTS" MEANS FEES AND OTHER COSTS THAT ARE BASED ON PREVAILING MARKET RATES FOR THE KIND AND QUALITY OF THE FURNISHED SERVICES,BUT NOT EXCEEDING THE AMOUNTS ACTUALLY SPENT FOR EXPERT WITNESSES, THE COST OF ANY STUDY, ANALYSIS,REPORT, TEST OR PROJECT THAT IS FOUND TO BE NECESSARY TO PREPARE THE PARTY'S CASE AND NECESSARY FEES FOR ATTORNEYS OR OTHER REPRESENTATIVES. Section 25.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-596 to read: Sec.8A-596.(RESERVED)(State ADMINISTRATION AND Audits) Sec.8A-596.AGREEMENT FOR INSTALLMENT PAYMENTS OF TAX.(Local Audits) (a)THE CITY MAY ENTER INTO AN AGREEMENT WITH A TAXPAYER TO ALLOW THE TAXPAYER TO SATISFY A LIABILITY FOR ANY TAX IMPOSED BY THIS CHAPTER BY 25 MEANS OF INSTALLMENT PAYMENTS.THE TAX COLLECTOR MAY REQUIRE A TAXPAYER WHO REQUESTS AN INSTALLMENT PAYMENT AGREEMENT TO COMPLETE A FINANCIAL REPORT IN SUCH FORM AND MANNER AS THE TAX COLLECTOR MAY PRESCRIBE. (b)THE TAX COLLECTOR, WITHOUT NOTICE, MAY ALTER, MODIFY OR TERMINATE AN INSTALLMENT PAYMENT AGREEMENT IF THE TAXPAYER: (1)FAILS TO PAY AN INSTALLMENT AT THE TIME THE INSTALLMENT PAYMENT IS DUE UNDER THE AGREEMENT. (2)FAILS TO PAY ANY OTHER TAX LIABILITY AT THE TIME THE LIABILITY IS DUE. (3)FAILS TO FILE ANY TAX REPORT OR RETURN AT THE TIME THE REPORT OR RETURN IS DUE. (4)FAILS TO FURNISH ANY INFORMATION REQUESTED BY THE TAX COLLECTOR WITHIN THIRTY DAYS AFTER RECEIVING A WRITTEN REQUEST FOR SUCH INFORMATION. (5)FAILS TO NOTIFY THE TAX COLLECTOR OF A MATERIAL IMPROVEMENT IN THE TAXPAYER'S FINANCIAL CONDITION ABOVE THE INCOME PREVIOUSLY REPORTED IN THE MOST RECENT INCOME STATEMENT WITHIN THIRTY DAYS AFTER THE MATERIAL IMPROVEMENT. (6)PROVIDES INACCURATE, FALSE OR INCOMPLETE INFORMATION TO THE TAX COLLECTOR. (c)NOTWITHSTANDING ANY INSTALLMENT PAYMENT AGREEMENT, THE TAX COLLECTOR MAY OFFSET ANY TAX REFUNDS AGAINST THE LIABILITIES PROVIDED FOR IN THE INSTALLMENT PAYMENT AGREEMENT, MAY FILE AND PERFECT ANY TAX LIENS AND, IN THE EVENT THE TAXPAYER BREACHES ANY TERM OR PROVISION OF THE INSTALLMENT PAYMENT AGREEMENT, MAY ENGAGE IN COLLECTION ACTIVITIES. (d)THE TAX COLLECTOR,WITHOUT NOTICE,MAY TERMINATE AN INSTALLMENT PAYMENT AGREEMENT IF THE TAX COLLECTOR BELIEVES THAT THE COLLECTION OF TAX TO WHICH THE PAYMENT AGREEMENT PERTAINS IS IN JEOPARDY. (e)IF THE TAX COLLECTOR DETERMINES THAT THE FINANCIAL CONDITION OF A TAXPAYER HAS IMPROVED,THE TAX COLLECTOR MAY ALTER,MODIFY OR TERMINATE THE AGREEMENT BY PROVIDING NOTICE TO THE TAXPAYER AT LEAST THIRTY DAYS BEFORE THE EFFECTIVE DATE OF THE ACTION.THE NOTICE SHALL INCLUDE THE REASONS WHY THE TAX COLLECTOR BELIEVES THE ALTERATION, MODIFICATION OR TERMINATION IS APPROPRIATE. (f)AN INSTALLMENT PAYMENT AGREEMENT SHALL REMAIN IN EFFECT FOR THE TERM OF THE AGREEMENT EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION. (g)A TAXPAYER WHO IS AGGRIEVED BY A DECISION OF THE TAX COLLECTOR TO REFUSE TO ENTER INTO AN INSTALLMENT PAYMENT AGREEMENT OR TO ALTER, MODIFY OR TERMINATE AN AGREEMENT ENTERED INTO PURSUANT TO THIS SECTION MAY PETITION THE TAXPAYER PROBLEM RESOLUTION OFFICER TO REVIEW THAT DETERMINATION. THE TAXPAYER PROBLEM RESOLUTION OFFICER MAY STAY SUCH ALTERATION,MODIFICATION OR TERMINATION PENDING ITS REVIEW AND MAY MODIFY OR NULLIFY THE DETERMINATION. (h)THE CITY AND THE TAXPAYER MAY MODIFY ANY INSTALLMENT PAYMENT AGREEMENT AT ANY TIME BY ENTERING INTO A NEW OR MODIFIED AGREEMENT. 26 Section 26.Article V of the City Tax Code of the City of Apache Junction is amended by adding Section 8A-597 to read: Sec.8A-597.(RESERVED)(State ADMINISTRATION AND Audits) Sec.8A-597.PRIVATE TAXPAYER RULINGS; REQUEST; REVOCATION OR MODIFICATION; DEFINITION.(Local Audits) (a)THE TAX COLLECTOR SHALL ISSUE PRIVATE TAXPAYER RULINGS TO TAXPAYERS AND POTENTIAL TAXPAYERS ON REQUEST.EACH REQUEST SHALL BE IN WRITING AND SHALL: (1)STATE THE NAME, ADDRESS AND, IF APPLICABLE, TAXPAYER IDENTIFYING NUMBER OF THE TAXPAYER OR POTENTIAL TAXPAYER WHO REQUESTS THE RULING. (2)DESCRIBE ALL FACTS THAT ARE RELEVANT TO THE REQUESTED RULING. (3)STATE WHETHER,TO THE BEST KNOWLEDGE OF THE TAXPAYER OR POTENTIAL TAXPAYER,THE ISSUE OR RELATED ISSUES ARE BEING CONSIDERED BY THE TAX COLLECTOR OR ANY OTHER TAXING JURISDICTION IN CONNECTION WITH AN ACTIVE AUDIT,PROTEST OR APPEAL THAT INVOLVES THE TAXPAYER OR POTENTIAL TAXPAYER AND WHETHER THE SAME REQUEST HAS BEEN OR IS BEING SUBMITTED TO ANOTHER TAXING JURISDICTION FOR A RULING. (4)BE SIGNED BY THE TAXPAYER OR POTENTIAL TAXPAYER WHO MAKES THE REQUEST OR BY AN AUTHORIZED REPRESENTATIVE OF THE TAXPAYER OR POTENTIAL TAXPAYER. (b)A PRIVATE TAXPAYER RULING MAY BE REVOKED OR MODIFIED BY EITHER: (1)A CHANGE OR CLARIFICATION IN THE LAW THAT WAS APPLICABLE AT THE TIME THE RULING WAS ISSUED, INCLUDING CHANGES OR CLARIFICATIONS CAUSED BY REGULATIONS AND COURT DECISIONS. (2)ACTUAL WRITTEN NOTICE BY THE TAX COLLECTOR TO THE LAST KNOWN ADDRESS OF THE TAXPAYER OR POTENTIAL TAXPAYER OF THE REVOCATION OR MODIFICATION OF THE PRIVATE TAXPAYER RULING. (c)WITH RESPECT TO THE TAXPAYER OR PROSPECTIVE TAXPAYER TO WHOM A PRIVATE TAXPAYER RULING IS ISSUED, THE REVOCATION OR MODIFICATION OF A PRIVATE TAXPAYER RULING SHALL NOT BE APPLIED RETROACTIVELY TO TAX PERIODS OR TAX YEARS BEFORE THE EFFECTIVE DATE OF THE REVOCATION OR MODIFICATION AND THE TAX COLLECTOR SHALL NOT ASSESS ANY PENALTY OR TAX ATTRIBUTABLE TO ERRONEOUS ADVICE THAT IS FURNISHED TO THE TAXPAYER OR POTENTIAL TAXPAYER IN THE PRIVATE TAXPAYER RULING IF: (1)THE TAXPAYER REASONABLY RELIED ON THE PRIVATE TAXPAYER RULING. (2)THE PENALTY OR TAX DID NOT RESULT EITHER FROM A FAILURE BY THE TAXPAYER TO PROVIDE ADEQUATE OR ACCURATE INFORMATION OR FROM A CHANGE IN THE INFORMATION. (d)A PRIVATE TAXPAYER RULING MAY NOT BE RELIED UPON, CITED NOR INTRODUCED INTO EVIDENCE IN ANY PROCEEDING BY ANY TAXPAYER OTHER THAN THE TAXPAYER WHO RECEIVED THE RULING. (e)A TAXPAYER MAY APPEAL THE PROPRIETY OF A RETROACTIVE APPLICATION OF A REVOKED OR MODIFIED PRIVATE TAXPAYER RULING BY FILING A WRITTEN PETITION WITH THE TAX COLLECTOR PURSUANT TO SECTION 8A-570 WITHIN FORTY-FIVE (45) DAYS AFTER RECEIVING WRITTEN NOTICE pF THE INTENT TO RETROACTIVELY APPLY A REVOKED OR MODIFIED PRIVATE TAXPAYER RULING. 27 (f) (g) A PRIVATE TAXPAYER RULING CONSTITUTES THE TAX COLLECTOR'S INTERPRETATION OF THE SECTIONS OF THIS CHAPTER ONLY AS THEY APPLY TO THE TAXPAYER MAKING, AND THE PARTICULAR FACTS CONTAINED IN, THE REQUEST. A PRIVATE TAXPAYER RULING WHICH ADDRESSES A TAXPAYER'S ONGOING BUSINESS ACTIVITIES WILL APPLY ONLY TO TRANSACTIONS THAT OCCUR OR TAX LIABILITIES THAT ACCRUE FROM AND AFTER THE DATE OF THE TAXPAYER'S RULING REQUEST. (h)THE TAX COLLECTOR SHALL ATTEMPT TO ISSUE PRIVATE TAXPAYER RULINGS WITHIN FORTY-FIVE (45) DAYS AFTER RECEIVING THE WRITTEN REQUEST AND ON RECEIVING THE FACTS THAT ARE RELEVANT TO THE RULING.IF THE RULING IS EXPECTED TO BE DELAYED BEYOND THE FORTY-FIVE (45)DAYS,THE TAX COLLECTOR SHALL NOTIFY THE REQUESTOR OF THE DELAY AND THE PROPOSED DATE OF ISSUANCE. (i)WITHIN THIRTY (30)DAYS AFTER BEING ISSUED,THE TAX COLLECTOR SHALL MAINTAIN THE PRIVATE TAXPAYER RULING AS A PUBLIC RECORD AND MAKE IT AVAILABLE AT A REASONABLE COST FOR PUBLIC INSPECTION AND COPYING.THE TEXT OF PRIVATE TAXPAYER RULINGS ARE OPEN TO PUBLIC INSPECTION SUBJECT TO THE CONFIDENTIALITY REQUIREMENTS PRESCRIBED BY SECTION 8A-510. (j)IN THIS SECTION, "PRIVATE TAXPAYER RULING" MEANS A WRITTEN DETERMINATION BY THE TAX COLLECTOR ISSUED PURSUANT TO THIS SECTION THAT INTERPRETS AND APPLIES ONE OR MORE SECTIONS CONTAINED IN THIS CHAPTER AND ANY APPLICABLE REGULATIONS. (k)A PRIVATE TAXPAYER RULING ISSUED BY THE ARIZONA DEPARTMENT OF REVENUE PURSUANT TO A.R.S. SECTION 42-139.21 MAY BE RELIED UPON BY THE TAXPAYER TO WHOM THE RULING WAS ISSUED AND MUST BE RECOGNIZED AND FOLLOWED BY ANY CITY IN WHICH SUCH TAXPAYER HAS OBTAINED A PRIVILEGE LICENSE IF THE CITY HAS NOT ISSUED A RULING ADDRESSING THE FACTS DESCRIBED IN THE TAXPAYER'S RULING REQUEST AND THE STATUTE AT ISSUE IN THE TAXPAYER'S RULING REQUEST IS, IN ESSENCE, WORDED AND WRITTEN THE SAME AS THE APPLICABLE SECTION HEREUNDER. Section 27. Regulation 8A-416.2 of the City Tax Code of the City of Apache Junction is amended to read: Reg.8A-416.2.Reconstruction contracting. (a)"Reconstruction (of Real Property)"shall mean the subdividing of real property and, in addition, all construction contracting activities performed upon said real property; provided, however, that each of the following conditions are met: (1)a structure existed on said real property prior to the reconstruction activity; and (2)the "prior value" of said structure exceeds fifteen percent (15%) of the "prior value" of the integrated property (land, improvements, and structure); and (3)the total cost of all construction contracting activities performed on said real property in the twenty-four (24) month period prior to the sale of any part of the real property exceeds fifteen percent (15%) of the "prior value" of the real property; and (4)the structure which existed on the real property prior to the reconstruction activity still exists in some form upon the property, and is included, in whole or in part, in the property sold. 28 (b)Except as provided in subsection (c) below,"prior value"means the value of the total integrated property, with improvements, as existing immediately prior to any reconstruction activity.•-• • • -•=- =.-;-• • •a - =a •-•9 ;WHERE, ACCORDING TO TITLE 42 OF THE ARIZONA REVISED STATUTES, A PROPERTY'S FULL CASH VALUE FOR SECONDARY TAX PURPOSES IS INTENDED TO REPRESENT THE PROPERTY'S FAIR MARKET VALUE,"PRIOR VALUE'SHALL BE THE PROPERTY'S FULL CASH VALUE FOR SECONDARY PROPERTY TAX PURPOSES as determined by the County Assessor, -•• --•• •'--.. •. •.. • --,• .. • -• •••••••• •a-.- • • • -.• - .-in the year vviti-e s immediately preceding the year in which the reconstruction ffitpterrtneflts IMPROVEMENT(S) are or could have been included in the County Assessor's valuation.If the County Assessor's valuation is contested or appealed, the final determination at either the administrative or judicial level shall apply. WHERE, ACCORDING TO TITLE 42 OF THE ARIZONA REVISED STATUTES, A PROPERTY'S FULL CASH VALUE FOR SECONDARY PROPERTY TAX PURPOSES IS NOT INTENDED TO REPRESENT THE PROPERTY'S FAIR MARKET VALUE,"PRIOR VALUE"SHALL BE THE PROPERTY'S FAIR MARKET VALUE PRIOR TO THE RECONSTRUCTION IMPROVEMENT(S). (c)"Alternative Prior Value"shall mean that as an alternative to the "prior value" defined above, the taxpayer may use his actual cost of the reconstructed property prior to the reconstruction, provided that evidence of such cost is presented to the Tax Collector and is determined by the Tax Collector, in his sole discretion, to be satisfactory.such evidence shall consist, tra AT a minimum, of proof of the actual, arms -length acquisition price, accompanied by a full appraisal of all property involved which appraisal shall have been performed by a real estate broker or MAI appraiser specifically for the purpose of assisting in the acquisition and further shall have been performed on behalf of the seller or a lending institution which has lent at least sixty-five percent (65%) of the acquisition price.(Only long term lending —not interim or construction financing will be considered.)This alternative value shall be used only if the property was acquired by the reconstruction taxpayer not more than thirty-six (36) months prior to a "sale" as defined below. (d)A "sale"for the purpose of determining "alternative prior value" or "reconstruction" only shall be deemed to have occurred as of the date of the execution of a contract of sale or deed (joint tenancy or warranty) whichever is earlier, to a purchaser or grantee of any single residential or other occupancy unit.In addition to the foregoing, a lease with option to purchase a single residential unit shall be considered a "sale" at the date of execution of such lease if said option is exercisable by the lessee in not later than nine (9) months. Further in the case of cooperative apartments, the sale date shall be the date of execution of the contract selling (subject or not to encumbrances, liens or security interests) of a share, or a sufficient number of shares which entitle the purchaser to the occupancy of a residential unit.In all cases a person shall include a husband and wife as a community, or any co- occupants of a single unit as joint tenants. Section 28.Regulation 8A-450.2 of the City Tax Code of the City of Apache Junction is amended to read: Reg.8A-450.2.Rental,leasing,and licensing for use of tangible personal property: membership fees; other charges. (a)Membership, admission, or other fees charged by any rental club or limited access lessor are considered part of taxable gross income. (b)Gross income from rental, leasing, or licensing for use of tangible personal property must include all charges by the lessor to the lessee for repair, maintenance, or other service upon the tangible personal property rented, leased, or licensed. 29 (c)(Reserved)SALE OF A WARRANTY, MAINTENANCE, OR SERVICE CONTRACT AS A REQUIREMENT OF, OR IN CONJUNCTION WITH, A RENTAL, LEASING, OR LICENSING CONTRACT IS EXEMPT. Section 29.Regulation 8A-450.5 of the City Tax Code of the City of Apache Junction is amended to read: Reg. 8A-450.5.Rental, leasing, and licensing for use of tangible personal property: delivery, installation, repair, and maintenance charges. (a)Delivery and installation charges in connection with the rental, leasing, and licensing of tangible personal property are exempt from the tax imposed by Section 8A-450; provided that the provisions of Regulation 8A-100.2 have been met. (b)Gross income from the sale of a warranty. maintenance, or similar service contract in connection with the rental, leasing, and licensing of tangible personal property shall be EXEMPT. t 2) LI I lln-m -1111.1.11 IIC -MIILJI • • ot whether sucn contract is optional wan me customer. -(Reserved) B. r oardI (c)Separately stated charges for repair not included as part of a warranty. maintenance, or similar service contract relating to the rental, leasing, or licensing of tangible personal property are exempt from the tax imposed by Section 8A-450; however, such income is subject to the provisions of Sections 8A-460 and 8A-465, and the provisions of Regulation 8A-465.1. Section 30.Regulation 8A-465.2 of the City Tax Code of the City of Apache Junction is amended to read: Reg. 8A-465.2.(Reserved)RETAIL SALES:WARRANTY, MAINTENANCE, AND SIMILAR SERVICE CONTRACTS. (a)GROSS INCOME FROM SALES OF WARRANTY,MAINTENANCE,AND SERVICE CONTRACTS IS EXEMPT FROM THE TAX IMPOSED BY SECTION 8A-460. (b)TRANSFERS OF TANGIBLE PERSONAL PROPERTY IN CONNECTION WITH A SERVICE, WARRANTY, GUARANTY, OR MAINTENANCE AGREEMENT BETWEEN A VENDOR AND A VENDEE SHALL BE SUBJECT TO TAX UNDER SECTION -460 ONLY TO THE EXTENT OF GROSS INCOME RECEIVED FROM SEPARATELY ITEMIZED CHARGES MADE FOR THE ITEMS OF PROPERTY TRANSFERRED. (c)THE GROSS INCOME DERIVED FROM A MAINTENANCE INSURANCE AGREEMENT, WHICH AGREEMENT IS ENTERED INTO BETWEEN THE PURCHASER AND ANY PERSON OTHER THAN THE SELLER IS NOT SUBJECT TO TAX IMPOSED BY SECTION 8A-460. IF THE PROVIDER OF THE MAINTENANCE INSURANCE AGREEMENT PAYS FOR TANGIBLE PERSONAL PROPERTY ON BEHALF OF THE INSURED IN THE PERFORMANCE OF THE AGREEMENT, SUCH SALES ARE SUBJECT TO ALL APPLICABLE TAXES IMPOSED BY THIS CHAPTER. (d)CHARGES FOR TANGIBLE PERSONAL PROPERTY PROVIDED UNDER THE TERMS OF A WARRANTY, MAINTENANCE, OR SERVICE CONTRACT EXEMPTED UNDER SECTION 8A-465 ARE SUBJECT TO TAX AS RETAIL SALES. 30 (e)HOWEVER, GROSS INCOME RECEIVED BY A DEALER FROM A MANUFACTURER FOR WORK PERFORMED UNDER A MANUFACTURER'S WARRANTY IS NOT TAXABLE UNDER SECTION 8A-460. 31