NOTICE IS HEREBY GIVEN That, pursuant to s.
125.03, Stats., the Department of Revenue will hold a public hearing to consider permanent rules revising Chapters
Tax 4,
8, and
9 relating to general provisions of excise taxation and enforcement.
Hearing Dates and Locations
The hearing will be held:
Date: Monday, April 1, 2013
Time: 1:00 p.m.
Location: Events Room
State Revenue Building
2135 Rimrock Road
Madison, WI 53713
Handicap access is available at the hearing location.
Appearances at the Hearing and Submittal of Written Comments
Interested persons are invited to appear at the hearing and may make an oral presentation. It is requested that written comments reflecting the oral presentation be given to the department at the hearing. Written comments may also be submitted to the contact person listed below or to adminrules.wisconsin.gov no later than April 1, 2013, and will be given the same consideration as testimony presented at the hearing.
Dale Kleven
Department of Revenue
Mail Stop 6-40, 2135 Rimrock Road
P.O. Box 8933
Madison, WI 53708-8933
Telephone: (608) 266-8253
Analysis by the Department of Revenue
Statute interpreted
Statutory authority
Explanation of agency authority
Section
125.03, Stats., provides “[t]he department, in furtherance of effective control, may promulgate rules consistent with this chapter and ch.
139."
Related statute or rule
There are no other applicable statutes or rules.
Plain language analysis
The proposed rule makes the following changes:
• Updates notes and examples throughout Chapter
Tax 4 to provide current rates of tax and department contact information.
• Repeals s.
Tax 8.11 concerning the submission of paper reports, as all reports are electronically filed.
• Updates notes throughout Chapter
Tax 8 to provide current contact information for the department.
• Amends s.
Tax 9.19 to reflect that, due to advances in technology, machines other than fuson machines may be used to affix cigarette stamps.
• Amends s.
Tax 9.21 (3) to be consistent with s.
139.34 (3), Stats., which prohibits out-of-state distributers from shipping unstamped cigarettes to other distributers.
• Repeals s.
Tax 9.26 (1) to ensure compliance with Master Settlement Agreement requirements concerning the level of trade or transfer of unstamped cigarettes between distributers among themselves and also with manufacturers.
• Updates notes and examples throughout Chapter
Tax 9 to provide current rates of tax and department contact information.
Summary of, and comparison with, existing or proposed federal regulation
There is no existing or proposed federal regulation that is intended to address the activities to be regulated by the rule.
Comparison with rules in adjacent states
The department is not aware of a similar rule in an adjacent state.
Summary of factual data and analytical methodologies
2012 Executive Order 61 and
2011 Wisconsin Act 46 requires state agencies to work with the Small Business Regulatory Review Committee to review the agency's administrative rules that may be particularly onerous to small businesses in Wisconsin. In response, the department initiated a comprehensive review of all of its administrative rules. The changes described above were identified as part of that review. No other data was used in the preparation of this rule order or this analysis.
Analysis and supporting documents used to determine effect on small business
This rule order makes changes to reflect current law and current department policy. It makes no policy or other changes having an effect on small business.
Anticipated costs incurred by private sector
This rule order does not have a fiscal effect on the private sector.
Effect on Small Business and Initial Regulatory Flexibility Analysis
This rule order does not affect small business.
Agency Contact Person
Text of Rule
SECTION 1. Tax 4.12 (3) (b) 1. (Example 1) and (Example 2) and 3.a. (Example) are amended to read:
Tax 4.12 (3) (b) 1. (Example 1) An account of a supplier who is still in business becomes worthless and meets the requirements to be charged off for income or franchise tax purposes on January 10, 1995 2011. The supplier may claim a bad debt deduction on the motor vehicle fuel tax return, form MF-002, filed for the month of January 1995 2011, even though the bad debt deduction may not be claimed for income or franchise tax purposes until the 1995 2011 income or franchise tax return is filed in 1996 2012.
(Example 2) Assume the same facts as in Example 1, except the account is that of a wholesaler distributor. Irrespective of when the wholesaler distributor files the income or franchise tax return on which the bad debt deduction is claimed, the wholesaler distributor may file a claim for refund to recover the uncollected motor vehicle fuel tax any time between January 10, 1995 2011 and April 15, 2000 2016.
3.a. (Example) At the time when the tax rate is 23.2¢
30.9¢ per gallon, Supplier A sells 8,000 gallons of gasoline to Company B. Company B has an agreement with Supplier A to delay payment of the tax. The amount of the contract is $9,696 $12,942, consisting of tax, $1,856 $2,472, and the cost of fuel, $7,840 $10,470. Company B defaults and discontinues operations, leaving a balance due Supplier A of $2,100, which includes interest of $200 not included in the contract amount. The deductible tax loss is $367
$363, computed as follows:
Contract amount $9,696$12,942
Unpaid contract amount -1,900
Paid contract amount $7,796$11,042
Portion constituting tax* x.191
Tax paid $1,489$2,109
*$1,856 $2,472 tax ÷ $9,696 $12,942 contract amount = .191.
Since $1,489 $2,109 of the tax of $1,856 $2,472 was paid, only the unpaid tax of $367 $363 may be deducted.
SECTION 2. Tax 4.55 (2) (a) (Note) is created to read:
Tax 4.55 (2) (a) (Note) Form MF-100 is available on the department's web site at
www.revenue.wi.gov.
SECTION 3. Tax 4.55 (3) (b) (Note 1) is repealed.
SECTION 4. Tax 4.65 (3) (f) (Note 1) is amended to read:
Tax 4.65 (3) (f) (Note 1) Copies of vendor registration form MF-112, exemption certificate form MF-209
, and refund claim form MF-012
may be obtained by writing or calling Wisconsin Department of Revenue, Audit Bureau, P.O. Box 8906, Madison, WI 53708-8906, (608) 266-7233 are available on the department's web site at www.revenue.wi.gov.
SECTION 5. Tax 8.001 (2) (c) 1. (Note) is amended to read:
Tax 8.001 (2) (c) 1. (Note) Written requests should be e-mailed to
excise@revenue.wi.gov, faxed to (608) 261-7049, or addressed to
Mandate Waiver Request, Wisconsin Department of Revenue,
Excise Tax Section - Mail Stop
5-107 6-107, PO Box 8900, Madison WI 53708-8900.
SECTION 6. Tax 8.03 (2) (Note) is amended to read:
Tax 8.03 (2) (Note) Wine collector registrations may be addressed to Wisconsin Department of Revenue, Excise Tax Section – Mail Stop 6-107, PO Box 8900, Madison, Wisconsin 53708-8900.
SECTION 7. Tax 8.11 is repealed.
SECTION 8. Tax 9.001 (2) (c) 1. (Note) is amended to read:
Tax 9.001 (2) (c) 1. (Note) Written requests should be e-mailed to
excise@revenue.wi.gov, faxed to (608) 261-7049, or addressed to
Mandate Waiver Request, Wisconsin Department of Revenue,
Excise Tax Section - Mail Stop
5-107 6-107, PO Box 8900, Madison WI 53708-8900.
SECTION 9. Tax 9.19 (Title) is amended to read:
Tax 9.19 (Title) Fuson Stamp application machines and stamps.
SECTION 10. Tax 9.19 (1) is repealed.
SECTION 11. Tax 9.19 (2) is amended to read:
Tax 9.19 (2) The use of fuson stamps and any machines or devices for their application by any distributor shall be subject to the approval of the secretary of revenue and the approval may be withdrawn at any time at the discretion of the secretary of revenue.
SECTION 12. Tax 9.21 (3) is amended to read:
Tax 9.21 (3) All out-of-state manufacturers or distributors may ship cigarettes either stamped or unstamped directly to any Wisconsin manufacturers or distributors who hold the proper permit issued by the department.
SECTION 13. Tax 9.26 (1) is repealed.
SECTION 14. Tax 9.47 (4) is amended to read:
Tax 9.47 (4) A clearly legible copy of all invoices evidencing a sale or exchange of cigarettes shall be retained by each of the parties to the transaction for a period of at least 2 5 years from the date of the invoice, in groups covering a period of one month each.
SECTION 15. Tax 9.51 (1) is amended to read:
Tax 9.51 (1) Cigarettes shipped into this state by manufacturers to their representatives, including advertising agencies and airlines, for the purpose of free samples shall be accompanied by a memo invoice stating brands and number of cigarettes. The memos shall be retained by the representative for the statutory period of 2
5 years.
SECTION 16. Tax 9.68 (2) (a) (Note) is created to read:
Tax 9.68 (2) (a) (Note) Form CTP-129 is available on the department's web site at
www.revenue.wi.gov.
SECTION 17. Tax 9.68 (3) (b) (Note 1) is repealed.
SECTION 18. Tax 9.70 (3) (d) (Example 1) and (Example 2) are amended to read:
Tax 9.70 (3) (d) (Example 1) At a time when the cigarette tax rate is 3.85¢ 12.6¢ per stick, Person A sells cigarettes to Customer B. The amount of the invoice is $10,000
$20,000, consisting of cigarette tax of $1,540 $5,040, cost of cigarettes of $6,000 $12,000 and sundries of $2,460 $2,960. Customer B defaults and discontinues operations, leaving a balance due to Person A of $2,100, which includes interest of $200 not included in the original invoice amount. The deductible tax is $292.60 $478.80, computed as follows:
Tax per invoice $1,540.00 $5,040.00
