68th OREGON LEGISLATIVE ASSEMBLY--1995 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 3480
House Bill 3156
Sponsored by Representative REPINE
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Imposes tax on mushroom dealers. Requires mushroom dealers to
obtain license from Department of Revenue. Authorizes Department
of Revenue to administer and collect tax. Imposes civil
penalties. Punishes certain violations by maximum five years'
imprisonment, $100,000 fine, or both.
A BILL FOR AN ACT
Relating to taxation of mushrooms; and appropriating money.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + As used in sections 1 to 37 of this Act, unless
the context requires otherwise:
(1) 'Amount of proceeds' means the dealer's cost of acquiring
the mushrooms from a harvester.
(2) 'Dealer' means any person that purchases mushrooms from a
harvester for resale.
(3) 'Department' means the Department of Revenue.
(4) 'Harvester' means a person who severs mushrooms from the
land and sells the mushrooms or holds the mushrooms out for sale
to another person.
(5) 'Mushroom' means any enlarged complex aerial fleshy
fruiting body of fungus, including the matsutake variety of
mushroom. + }
{ + (6) 'Person' includes a natural person, association,
firm, partnership, corporation or any group acting as a unit. + }
SECTION 2. { + (1) A tax is imposed upon the purchase for
resale of all mushrooms in this state at the rate of ___ percent
of the amount of proceeds from mushroom sales.
(2) The tax shall be imposed on licensed dealers at the time
the dealer acquires in this state and for resale, mushrooms for
which no license tax previously has been incurred.
(3) If the tax imposed under this section does not equal an
amount calculable to a whole cent, the tax shall be equal to the
next highest whole cent. However, the amount remitted to the
Department of Revenue by the taxpayer for each calendar year
shall be equal only to 98.5 percent of the total taxes due and
payable by the taxpayer for the calendar year.
(4) No mushrooms shall be subject to the tax if previously
taxed under this section. + }
SECTION 3. { + (1) Except as otherwise provided in sections 1
to 37 of this Act, the tax imposed by section 2 of this Act shall
be paid by each licensed dealer to the Department of Revenue on
or before the last day of January of each year for the preceding
calendar year.
(2) With each annual payment, the taxpayer shall submit a
return to the department, in such form and containing such
information as the department may prescribe.
(3) The tax, penalties and interest imposed by sections 1 to 37
of this Act shall be a personal debt, from the time liability is
incurred, owed by the taxpayer to the State of Oregon until paid.
(4) The returns required of licensed dealers under this section
shall be filed by all such dealers regardless of whether any tax
is owed.
(5) The department for good cause may extend the time for
making any return under sections 1 to 37 of this Act. The
extension shall not exceed one month in duration. The extension
may be granted at any time if a written request therefor is filed
with the department within or prior to the period for which the
extension may be granted. + }
SECTION 4. { + Section 2 of this Act shall not apply to a
person that purchases mushrooms from a harvester for personal
consumption. + }
SECTION 5. { + No person shall purchase for resale any
mushrooms until the dealer has secured a mushroom dealer
license. + }
SECTION 6. { + (1) Every person, before becoming a mushroom
dealer in this state, shall make an application to the Department
of Revenue for a license authorizing that person to engage in
business as a mushroom dealer.
(2) Application for the license must be made on forms
prescribed by the department.
(3) The application shall contain:
(a) The name under which the applicant is transacting business
within this state.
(b) The address at which the applicant intends to engage in
business as a mushroom dealer.
(4) If the applicant under this section is an association of
persons, firm, partnership or corporation organized under the
laws of another state, territory or country, and the applicant
has not already done so, the applicant must first comply with the
laws of this state relating to the transaction of business in
this state before being licensed as a mushroom dealer.
(5) No fee shall be charged for a license. + }
SECTION 7. { + (1) The Department of Revenue, to ensure
compliance with sections 1 to 37 of this Act, shall require a
licensee or an applicant for a license as a mushroom dealer to
deposit such security as the department may determine.
(2) The amount of the security shall be fixed by the department
but may not be greater than the annual estimated tax liability of
the dealer under sections 1 to 37 of this Act, determined in a
manner as the department considers proper.
(3) The required amount of security may be increased or
decreased by the department, subject to the limitations provided
in this section.
(4) Except as provided in section 9 of this Act, the security
shall be in the form of a bond or bonds executed by the licensee
or applicant as principal and by a corporation, authorized to
engage in business as a surety insurer in this state under ORS
742.350 to 742.376, as surety, payable to the State of Oregon
through its Department of Revenue, conditioned upon the payment
of all taxes, penalties and other obligations of the mushroom
dealer arising under sections 1 to 37 of this Act. + }
SECTION 8. { + Every bond shall contain a provision
substantially to the effect that when the surety exercises its
right to withdraw as surety, the withdrawal shall be effective on
the first day of the calendar month after receipt of the notice
by the Department of Revenue if the notice is received on or
before the 15th day of the month, otherwise the withdrawal shall
be effective on the first day of the second calendar month after
receipt of the notice by the department. + }
SECTION 9. { + In lieu of a bond or bonds a licensee or
applicant may, under such conditions as the Department of Revenue
may prescribe, deposit with the State Treasurer an amount of
lawful money equivalent to the amount of the bond or bonds
otherwise required, or the distributor may deposit an irrevocable
letter of credit issued by a commercial bank as defined in ORS
706.005, or readily salable bonds or other obligations of the
United States, the State of Oregon, or any county of this state
of an actual market value of not less than the amount of the bond
or bonds otherwise required by sections 1 to 37 of this Act. The
State Treasurer shall immediately notify the department as to the
time of receipt and the amount of money or value of the
irrevocable letter of credit or of bonds received by the State
Treasurer. + }
SECTION 10. { + Upon receipt of a completed application and
such security as the Department of Revenue may require under
sections 1 to 37 of this Act, the department shall issue to the
applicant a license as a mushroom dealer. A license is valid only
for engaging in business as a mushroom dealer, and it shall at
all times be conspicuously displayed at the dealer's place of
business. The license is not transferable, and is valid until
canceled, suspended or revoked. + }
SECTION 11. { + (1) If a dealer fails to comply with any
provision of sections 1 to 37 of this Act or any rule of the
Department of Revenue adopted under sections 1 to 37 of this Act,
the department may suspend or revoke the license or licenses held
by the dealer. The department shall not issue a new license after
the revocation of a license unless the department is satisfied
that the former holder of the license will comply with the
provisions of sections 1 to 37 of this Act.
(2) If the department proposes to refuse to issue a license, or
proposes to suspend or revoke a license, the department shall
give notice of the proposed refusal, suspension or revocation at
least 30 days before the refusal, suspension or revocation will
be final. Appeal following the notice of the determination may be
taken to the Director of the Department of Revenue in the manner
provided in ORS 305.275 within the time provided in ORS 305.280
(1).
(3) An appeal from the director's order sustaining a proposed
refusal to issue, or a suspension or revocation, may be taken by
the person filing an appeal to the Oregon Tax Court following the
procedure provided in ORS chapter 305 within the time prescribed
by ORS 305.560. + }
SECTION 12. { + The license of any mushroom dealer shall be
automatically suspended upon the cancellation of the bond of the
dealer, or if the bond becomes void or unenforceable for any
reason, or if the dealer fails to pay any taxes or penalties due
under sections 1 to 37 of this Act. The license shall be
automatically reinstated if the dealer files a valid bond, or
pays the delinquent taxes of the dealer, as appropriate. A dealer
whose license has been suspended under this section may appeal to
the Director of the Department of Revenue in the manner provided
in ORS 305.275. + }
SECTION 13. { + (1) If a person purchases for resale any
mushrooms with respect to which a tax under sections 1 to 37 of
this Act is due without first securing the license required by
section 6 of this Act, or without placing with the Department of
Revenue such security as the department may require, the tax
provided in section 2 of this Act on all mushrooms purchased by
the person shall immediately be due and payable.
(2) Except as otherwise provided in this subsection, the
department shall proceed to determine, from the best available
sources, the amount of the tax provided in section 2 of this Act,
and the department shall immediately assess that tax and interest
in the amount found due, together with a penalty of 100 percent
of the tax, and shall give written notice of the determination
and assessment to the person. The department may waive all or
part of a penalty imposed under this subsection if the department
determines that a violation of the requirement under this section
to secure the license or place security with the department was
due to reasonable cause and without intent to avoid payment of
the tax. In a suit or proceeding to collect the tax, interest or
penalty, the notice is prima facie evidence that the dealer named
is indebted to this state in the amount of the tax, interest and
penalty stated.
(3) Any tax, interest or penalty that is assessed under this
section is a debt due and owing to this state and may be
collected in the manner prescribed in section 29 of this Act. + }
SECTION 14. { + (1) The Department of Revenue may, upon
written request of a dealer, cancel any license issued to such
dealer, the cancellation to become effective 30 days from the
date of receipt of the written request.
(2) If the department ascertains and finds that the person to
whom a license has been issued is no longer engaged in the
business of a mushroom dealer, the department shall cancel the
license of the dealer upon investigation after 30 days' notice
has been mailed to the last-known address of the dealer. + }
SECTION 15. { + A licensed dealer who has a change of
ownership shall notify the Department of Revenue immediately of
the change. Upon notification, the department shall immediately
cancel the mushroom dealer license of the dealer. No license may
be issued to any successor of the dealer until the successor
completes an application and places with the department such
security as the department may require. For purposes of this
section:
(1) In the case of a corporation with more than 100
stockholders, transfer of stock in normal trading is not
considered a change in ownership.
(2) In the case of a corporation with 100 or fewer
stockholders, transfer of less than 50 percent of the stock in
any period of 12 consecutive months is not considered a change in
ownership. + }
SECTION 16. { + (1) Every dealer, and every person
transporting or storing mushrooms, shall keep at each registered
place of business complete and accurate records for that place of
business, including itemized invoices, of mushrooms held,
purchased, brought in or caused to be brought in from without the
state or shipped or transported to retail dealers in this state,
and of all sales of mushrooms made, except sales to the ultimate
consumer.
(2) The records required by subsection (1) of this section
shall show the names and addresses of purchasers, the inventory
of all mushrooms on hand, and other pertinent papers and
documents relating to the purchase, sale or disposition of
mushrooms.
(3) When a licensed dealer sells mushrooms exclusively to the
ultimate consumer at the dealer's place of business, no invoice
of those sales shall be required, but itemized invoices shall be
made of all mushrooms transferred to other places of business
owned or controlled by that licensed dealer.
(4)(a) All books, records and other papers and documents
required by this section to be kept shall be preserved for a
period of at least five years after the initial date of the
books, records and other papers or documents, or the date of
entries appearing therein, unless the Department of Revenue, in
writing, authorizes their destruction or disposal at an earlier
date.
(b) The department or its authorized representative, upon oral
or written demand, may make such examinations of the books,
papers, records and equipment required to be kept under this
section as it may deem necessary in carrying out the provisions
of sections 1 to 37 of this Act.
(c) If the department, or any of its agents or employees, are
denied free access or are hindered or interfered with in making
such examination, the license of the dealer shall be subject to
revocation by the department. + }
SECTION 17. { + Every person who sells mushrooms to persons
other than the ultimate consumer shall render with each sale
itemized invoices showing the seller's name and address, the
purchaser's name and address, the date of sale, and all prices
and discounts. The person shall preserve legible copies of all
such invoices for five years from the date of sale. + }
SECTION 18. { + Every retail dealer shall procure itemized
invoices of all mushrooms purchased. The invoices shall show the
name and address of the seller and the date of purchase. The
retail dealer shall preserve a legible copy of each such invoice
for five years from the date of purchase. Invoices shall be
available for inspection by the Department of Revenue or its
authorized agents or employees at the retail dealer's place of
business. + }
SECTION 19. { + Records of all deliveries or shipments of
mushrooms from any public warehouse of first destination in this
state shall be kept by the warehouse and be available to the
Department of Revenue for inspection. The records shall show the
name and address of the consignee, the date, the quantity of
mushrooms delivered and such other information as the department
may require. These records shall be preserved for five years from
the date of delivery of the mushrooms. + }
SECTION 20. { + (1) A harvester shall not be subject to tax
under sections 1 to 37 of this Act for the transportation of
untaxed mushrooms in this state from the place of harvest to the
dealer's place of business, if the harvester has obtained a
harvester's license under subsection (2) of this section.
(2) Upon application by the harvester to the Department of
Revenue, the department shall issue to the harvester a
harvester's license. The harvester's license shall be valid only
for the calendar year in which the application is made.
(3) The application for a harvester's license and the
harvester's license shall be on such forms as the department
shall prescribe. + }
SECTION 21. { + (1) Any transporter other than a licensed
harvester seeking to possess or acquire untaxed mushrooms for
transportation or to transport untaxed mushrooms upon the
highways, roads or streets of this state shall obtain a permit
from the Department of Revenue authorizing the transporter to
possess or acquire for transportation or transport the untaxed
mushrooms. The transporter shall have the permit in the
transporting vehicle during the period of transportation of the
mushrooms. The application for the permit shall be in such form
and shall contain such information as may be prescribed by the
department.
(2) Each transporter other than a licensed harvester who shall
transport, possess or acquire untaxed mushrooms for the purpose
of transporting the mushrooms upon the highways, roads or streets
of this state is required to have within the transporting vehicle
invoices or bills of lading covering the shipment of the
mushrooms being transported. The invoices or bills of lading
shall show the name and address of the consignor or seller, the
name and address of the consignee or purchaser and the quantity
of mushrooms being transported. + }
SECTION 22. { + The Department of Revenue shall administer and
enforce sections 1 to 37 of this Act. The department is
authorized to establish those rules and procedures for the
implementation and enforcement of sections 1 to 37 of this Act
that are consistent with its provisions and considered necessary
and appropriate. + }
SECTION 23. { + (1) No licensed dealer or other person shall:
(a) Fail to furnish any return required to be made pursuant to
sections 1 to 37 of this Act;
(b) Fail to furnish a supplemental return or other data
required by the Department of Revenue; or
(c) Render a false or fraudulent return, report or claim for
refund.
(2) No person who is required to make, render, sign or verify
any report or return under sections 1 to 37 of this Act shall
make a false or fraudulent report or return with intent to defeat
or evade the determination of an amount due required by law. + }
SECTION 24. { + (1) If there is a failure to file a return
required under sections 1 to 37 of this Act, or a failure to pay
a tax at the time the tax becomes due, and no extension is
granted under section 3 of this Act, or if the time granted as an
extension has expired and there is a failure to file a return or
pay a tax, there shall be added to the amount of tax required to
be shown on the return a delinquency penalty of five percent of
the amount of the tax.
(2) If the failure to file a return continues for a period in
excess of three months after the due date:
(a) There shall be added to the amount of tax required to be
shown on the return a failure to file penalty of 20 percent of
the amount of such tax; and
(b) Thereafter, the Department of Revenue may send a notice and
demand to the person to file a return within 30 days of the
mailing of the notice. If after such notice and demand no return
is filed within the 30 days, the department may determine the tax
according to the best of its information and belief, assess the
tax with appropriate penalty and interest, plus an additional
penalty of 25 percent of the tax deficiency determined by the
department, and give written notice of the determination and
assessment to the person required to make the filing.
(3) A penalty equal to 100 percent of any deficiency determined
by the department shall be assessed and collected if:
(a) There is a failure to file a return with intent to evade
the tax; or
(b) A return was falsely prepared and filed with intent to
evade the tax.
(4) Interest shall be collected on any unpaid tax at the rate
established under ORS 305.220, for each month or fraction of a
month, computed from the time the tax became due (without regard
to an extension of time for filing a return granted under section
3 of this Act), during which the tax remains unpaid.
(5) Each penalty imposed under this section is in addition to
any other penalty imposed under this section. However, the total
amount of penalty imposed under this section with respect to any
deficiency shall not exceed 100 percent of the deficiency. + }
SECTION 25. { + (1) If a person fails to file a report or
return within 60 days of the time prescribed under section 3 of
this Act, the Department of Revenue may petition the Oregon Tax
Court for an order requiring the person to show cause why the
person is not required to file the report or return.
(2) Within 10 days after the filing of the petition, the tax
court shall enter an order directing the person to appear and
show cause why no report or return is required to be filed. The
petition and order shall be served upon the person in the manner
provided by law. Not later than 20 days after service, the person
shall:
(a) File the requested report or return with the department;
(b) Request from the court an order granting reasonable time
within which to file the requested report or return with the
department; or
(c) File with the court an answer to the petition showing cause
why such report or return is not required to be filed.
(3) If an answer is filed, the court shall set the matter for
hearing within 20 days from the filing of the answer, and shall
determine the matter in an expeditious manner, consistent with
the rights of the parties.
(4) An appeal may be taken to the Supreme Court as provided in
ORS 305.445 from an order of the tax court made and entered after
a hearing and determination under subsection (3) of this section.
(5) Costs shall be awarded to the prevailing party. + }
SECTION 26. { + The provisions of ORS chapters 305 and 314 as
to the audit and examination of returns, periods of limitations,
determination of and notices of deficiencies, assessments, liens,
delinquencies, claims for refund and refunds, conferences,
appeals to the Director of the Department of Revenue, appeals to
the Oregon Tax Court, stay of collection pending appeal,
confidentiality of returns and the penalties and procedures
relating thereto, shall apply to the determinations of taxes,
penalties and interest under sections 1 to 37 of this Act, except
where the context requires otherwise. + }
SECTION 27. { + If, under sections 1 to 37 of this Act, the
Department of Revenue is not satisfied with the return of the tax
or the amount of tax required to be paid to this state by any
person, the department may compute and determine the amount
required to be paid upon the basis of the facts contained in the
return or upon the basis of any information within its possession
or that may come into its possession. One or more deficiency
determinations may be made of the amount due for one or more than
one period. Notices of deficiency shall be given and interest on
deficiencies shall be computed as provided in ORS 305.265.
Subject to ORS 314.421 and 314.423, liens for taxes or
deficiencies shall arise at the time of assessment, shall
continue until the taxes, interest and penalties are fully
satisfied and may be recorded and collected in the manner
provided for the collection of delinquent income taxes. + }
SECTION 28. { + If the Department of Revenue believes that the
collection of any tax imposed under sections 1 to 37 of this Act
or any amount of the tax required to be collected and paid to the
state or of any determination will be jeopardized by delay, the
department shall make a determination of the tax or amount of tax
required to be collected, noting that fact upon the
determination. The amount determined is immediately due and
payable and the department shall assess the taxes, notify the
person and proceed to collect the tax in the same manner and
using the same procedures as for the collection of income taxes
under ORS 314.440. + }
SECTION 29. { + (1) If the tax imposed under sections 1 to 37
of this Act or any portion of the tax is not paid within 30 days
after the date that the written notice and demand for payment
required under ORS 305.895 is mailed and no provision is made to
secure the payment thereof by bond, deposit or otherwise,
pursuant to regulations promulgated by the Department of Revenue,
the department may issue a warrant directed to the sheriff of any
county of the state commanding the sheriff to levy upon and sell
the real and personal property of the taxpayer found within that
county, for the payment of the amount of the tax, with the added
penalties, interest, collection charge and the sheriff's cost of
executing the warrant, and to return such warrant to the
department and pay to the department the money collected by a
time to be therein specified, but not less than 60 days from the
date of the warrant. A copy of the warrant shall be mailed or
delivered to the taxpayer by the department at the taxpayer's
last-known address.
(2) The sheriff shall, within five days after the receipt of
the warrant, record with the clerk of the county a copy thereof,
and thereupon the clerk shall enter in the County Clerk Lien
Record the name of the taxpayer mentioned in the warrant, and the
amount of the tax or portion thereof and penalties for which the
warrant is issued and the date when such copy is recorded.
Thereupon the amount of the warrant so recorded shall become a
lien upon the title to and interest in the property of the
taxpayer against whom it is issued in the same manner as a
judgment duly recorded. The sheriff thereupon shall proceed upon
the same in all respects, with like effect and in the same manner
prescribed by law in respect to executions issued against
property upon judgment of a court of record, and shall be
entitled to the same fees for services in executing the warrant,
to be added to and collected as a part of the warrant liability.
(3) In the discretion of the department a warrant of like
terms, force and effect may be issued and directed to any agent
authorized to collect taxes, and in the execution thereof the
agent shall have all the powers conferred by law upon sheriffs,
but is entitled to no fee or compensation in excess of actual
expenses paid in the performance of such duty.
(4) If a warrant is returned not satisfied in full, the
department shall have the same remedies to enforce the claim for
taxes against the taxpayer as if the people of the state had
recovered judgment against the taxpayer for the amount of the
tax, and shall balance the assessment record of the taxpayer by
transferring the unpaid deficiency to the taxpayer's delinquent
record. + }
SECTION 30. { + (1) The Director of the Department of Revenue
is authorized to enter into a mushroom tax refund agreement with
the governing body of any Indian reservation in Oregon. The
agreement may provide for a mutually agreed upon amount as a
refund to the governing body of any tax collected under sections
1 to 37 of this Act in connection with the sale, use or
distribution of mushrooms on the Indian reservation. This
provision is in addition to other laws allowing tax refunds.
(2) There is annually appropriated to the director from the
suspense account established under ORS 293.445 and section 32 of
this Act, the amounts necessary to make the refunds provided by
subsection (1) of this section. + }
SECTION 31. { + The remedies of the state provided for in
sections 1 to 37 of this Act are cumulative, and no action taken
by the Department of Revenue or Attorney General constitutes an
election by the state to pursue any remedy to the exclusion of
any other remedy for which provision is made in sections 1 to 37
of this Act. + }
SECTION 32. { + All moneys received by the Department of
Revenue under sections 1 to 37 of this Act shall be deposited in
the State Treasury and credited to a suspense account established
under ORS 293.445. After payment of administrative expenses
incurred by the department in the administration of sections 1 to
37 of this Act and payment of refunds or credits arising from
erroneous overpayments, the balance of the money shall be
transferred to the General Fund. + }
SECTION 33. { + The penalties provided in section 35 of this
Act are additional to all other penalties provided under sections
1 to 37 of this Act. + }
SECTION 34. { + (1) The taxes imposed by section 2 of this Act
are in lieu of all other state, county or municipal taxes on the
purchase of mushrooms for resale.
(2) Mushrooms upon which a tax has once been imposed under
section 2 of this Act shall not be subject upon a subsequent
distribution to the taxes imposed by section 2 of this Act. + }
SECTION 35. { + (1) If a person or an officer or employee of a
corporation or a member or employee of a partnership violates
section 23 (1)(a) or (b) of this Act, the Department of Revenue
shall assess against the person a civil penalty of not more than
$1,000. The penalty shall be recovered as provided in subsection
(4) of this section.
(2) A person or an officer or employee of a corporation or a
member or employee of a partnership who violates section 23
(1)(c) or (2) of this Act is liable to a penalty of not more than
$1,000, to be recovered in the manner provided in subsection (4)
of this section, and is also guilty of a Class C felony.
(3) If any person violates any provision of sections 1 to 37 of
this Act other than section 23 of this Act, the department shall
assess against the person a civil penalty of not more than
$1,000, to be recovered as provided in subsection (4) of this
section.
(4) Any person against whom a penalty is assessed under this
section may appeal to the Director of the Department of Revenue
as provided in ORS 305.275. If the penalty is not paid within 10
days after the order of the department becomes final, the
department may record the order and collect the amount assessed
in the same manner as income tax deficiencies are recorded and
collected under ORS 314.430. + }
SECTION 36. { + The tax imposed by section 2 of this Act shall
apply to the purchase of mushrooms for resale in this state,
occurring on or after January 1, 1996. + }
SECTION 37. { + (1) The records required by section 16 of this
Act shall show the inventory of mushrooms on hand on January 1,
1996.
(2) This section is repealed on January 1, 2001. + }
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