Section 10.11710 General
(a) The regulations are promulgated pursuant
to Title
10
V.S.A. §
1172(b).
(b) "Commissioner" means the Vermont
Commissioner of Taxes unless specifically designated otherwise.
(c) "Tax" means the levy imposed by Chapter
36 of Title 10, V.S.A.
(d) If the
taxability of a particular item or concern is not clear, a ruling should be
requested in writing from the Department of Taxes, Container Tax Section,
Montpelier, Vermont 05602.
Section
10.11711 Beverages
(a) "Beverage"
is defined to exclude "unadulterated, natural, reconstituted or frozen fruit,
vegetable or meat juices". If a beverage qualifies under any of the foregoing
exclusions, it is not taxable. The term "natural" means that there can be no
additions or subtractions from the juices to alter their natural state in any
way. The term "reconstituted" refers only to those juices which have been dried
and then have added to them water in no amount greater than the water present
in their natural state. The term "unadulterated" means those juices which have
had no substance added to them which is not naturally occuring in such juices.
Thus, while a juice may not be "natural", it may still be "unadulterated" and
hence qualify under the exclusion from the term "beverage".
(b) Concentrates and syrups do not constitute
"similar soft drinks in liquid form" and thus are excluded from the definition
of "beverage". If a liquid is not normally consumed exactly as it is found in
the container, it shall be deemed to be a concentrate or syrup.
(c) Liquids intended for medicinal purposes
only are excluded from the definition of "beverage". Any liquid which can be
used for other than medicinal purposes, even though it can also be used for
medicinal purposes, shall not be excluded from the definition of "beverage".
Examples of liquids which can be used for medicinal purposes but which do not
qualify for this exclusion are mineral waters and some spirituous
liquors.
Section
10.11712 Biodegradable
"Biodegradable Material" means organic material which is
capable of being broken down by bacteria into basic elements. Beverage
containers consisting of 90% or more biodegradable material are deemed to be
"containers made of biodegradable material" and are, therefore, not
"containers" by definition; thus, they are exempt from the levy.
Glass, metal and plastic are not biodegradable
materials.
Section 10.11714
Distributor
(a) The term "distributor" shall
include a distributor who is also a dealer. Thus, a distributor who owns
vending machines and sells taxable containers through such machines shall be
treated as a distributor.
(b) For
filing and payment requirements, refer to Regulation Sections 10.1172 -
1 and 10.1172
-
2.
Section 10.11721 Incidence of Tax
(a) For the purpose of §
1172(b)
of Title 10 V.S.A., "manufacturer or distributor" includes any such person (i)
who makes deliveries in vehicles owned, leased or controlled by such person
into Vermont on a regular basis of taxable beverage containers to Vermont
dealers, distributors or manufacturers, or (ii) who is required to file income
tax returns with the State of Vermont by reason of activities engaged in in
this State. Thus, the tax shall be paid by such a manufacturer or distributor
and not by the retailer, group of retailers or retail chain.
(b) Persons qualifying as retailers, groups
of retailers or retail chains, who are themselves required to pay the tax, may,
with the approval of the Commissioner, authorize an out-of-state manufacturer
or distributor to pay the tax on their behalf. However, such retailer, group of
retailers or retail chain shall remain primarily liable for the payment of tax.
The incidence of the tax upon retailers, groups of retailers
or retail chains required to pay the tax directly to the Commissioner arises at
the time of receipt by such retailer, group of retailers or retail chain or the
taxable beverage container.
(c) In situations in which both a
manufacturer and a distributor are subject to Vermont's jurisdiction for the
purpose of this tax (including manufacturers and distributors described in
subsection (a) of this regulation) and the manufacturer sells taxable beverage
containers to the distributor, the tax is upon the sale from the manufacturer
to the distributor and the manufacturer shall pay the tax unless that sale is
made prior to July 1, 1972, in which case the tax is upon the sale, on or after
July 1, 1972, by the distributor to the dealer and the distributor shall pay
the tax. Both the manufacturer and distributor are required to maintain such
records as are necessary to establish payment of the tax by the manufacturer.
Failure to establish such payment may result in assessment of the tax against
both the manufacturer and distributor.
In the situation in which the manufacturer is not subject to
the jurisdiction of the state for the purpose of this tax but the distributor
is, the tax is upon the sale from the distributor to the dealer. The
distributor is required to pay the tax. The distributor is required to maintain
such records as are necessary to establish payment of the tax.
(d) The tax applies to the sale by
manufacturers or distributors to establishments which do not resell the
beverage container for use off the premises of such establishments. For
example, the sale by a manufacturer or distributor of beer or other beverage in
taxable beverage containers to eating and drinking estalishments is subject to
the tax since the sale is to a dealer of a taxable beverage container intended
for use or consumption in Vermont.
Section 10.11722 Registration; Filing;
Payment; Extensions; Liability for Tax
(a)
Registration
On or before August 1, 1972, or in the case of manufacturers,
distributors or retailers becoming subject to this tax after August 1, 1972
within 15 days after becoming so taxable, shall file with the Commissioner a
certificate of registration in such form by him prescribed.
(b) Liability
Any taxpayer who fails to pay the tax to the Commissioner as
required shall be personally and individually liable for the amount of such
tax, and if the taxpayer is a corporate entity, the personal liability shall
extend and be applicable to any officer or agent of the corporation who as an
officer or agent of the corporation is under a duty to transmit the tax to the
Commissioner.
(c) Form and
Verification of Returns
The returns required to be filed under Chapter 36 of Title
10, V.S.A., shall be in such form and manner as the Commissioner prescribes and
shall be filed at the office of the Department of Taxes. Those returns shall be
verified by written declarations that the statements therein are made subject
to the pains and penalties of perjury. When a return is made by a corporation,
the person signing it shall be considered to be the person who is subject to
the pains and penalties of perjury. The Commissioner shall cause to be prepared
blank forms for the returns and shall furnish them upon application, but
failure to secure or receive such a form shall not relieve a taxpayer from the
obligation of filing any return herein required.
(d) Filing
Returns in the form prescribed by the Commissioner of Taxes
shall be filed by the persons required to pay the tax for each calendar quarter
on or before the thirtieth day of the month following the quarter for which the
return is being filed and the tax paid.
The Commissioner may require filing on other than a quarterly
basis if he deems it necessary for the proper administration of this
tax.
Even though there may be no actual tax liability for a
particular period, a return must be filed. Failure to do so will result in
assessment of late filing fees pursuant to regulation § 10.1172 -
4.
(e) Extension of Time
for Filing of Returns
For good cause shown, the Commissioner may extend the time
within which a taxpayer is required to file a return. If the extension results
in an extension of the time for the payment of the tax liability with respect
to which the return is filed, the taxpayer shall pay, at the date that tax
liability is paid within the authorized extension period, without assessment or
demand, an amount of interest computed at the rate of one-half of one per cent
per month or fraction thereof on that tax liability from the time when the tax
liability was originally required to be paid to the time of payment.
(f) Payment of Tax
(i) Every person required to file a tax
return shall, at the time of filing the return, pay to the Commissioner the
taxes imposed by Chapter 36 of Title 10, V.S.A. Then the Commissioner, in his
discretion, deems it necessary to protect the revenues to be obtained under
Chapter 36 of Title 10, V.S.A., he may require any person required to pay the
tax imposed by Chapter 36 of Title 10, V.S.A., to file with him a bond, issued
by a surety company authorized to transact business in this state and approved
by the Commissioner of Banking and Insurance of this state as to solvency and
responsibility, in an amount fixed by the Commissioner, to secure the payment
of any tax or penalties or interest due or which may become due from that
person under Chapter 36 of Title 10, V.S.A. In the event that the Commissioner
determines that a taxpayer is to file a bond, he shall give notice to him to
that effect, specifying the amount of the bond required. That person shall file
a bond within ten days after the giving of the notice unless within those ten
days he shall request in writing a hearing before the Commissioner at which the
necessity, propriety and amount of the bond shall be determined by the
Commissioner. The determination shall be final and shall be complied with
within fifteen days after the giving of notice thereof. In lieu of a bond,
securities approved by the State Treasurer or cash in such amount as the
Commissioner may prescribe, may be deposited with the State Treasurer who shall
keep such securities or cash in his custody; and the Commissioner may at any
time without notice to the depositor apply them to any tax or interest or
penalties due, and for that purpose the securities may be sold by the State
Treasurer at public or private sale without notice to the depositor
thereof.
(ii) Notwithstanding
paragraph (i) of this subsection, the Commissioner, if he believes the
collection from a taxpayer of any deficiency, penalty or interest to be in
jeopardy, may demand, in writing, that the taxpayer pay the deficiency, penalty
or interest forthwith. The demand may be made concurrently with, or after, the
notice of deficiency or the assessment of penalty or interest given to the
taxpayer. The amount of deficiency, penalty or interest shall be collectible by
the Commissioner on the date of the demand, unless the taxpayer files with the
Commissioner a bond in an amount equal to the deficiency, penalty or interest
sought to be collected as security for such amount as finally may be
determined. In the event that it is finally determined that the taxpayer was
not liable for the amount of the deficiency, penalty or interest referred to in
any demand under this subsection, the Commissioner shall reimburse the
taxpayer, promptly upon such determination, for the reasonable cost to the
taxpayer of any bond obtained by him for the purposes of this
subsection.
Section
10.11723 Examination of Records; Assessments; Hearings
(a) Examination of Records and Witnesses
The Commissioner, for the purpose of ascertaining the
correctness of any return or for the purpose of making a determination of the
tax liability of any taxpayer, may examine or cause to be examined by any agent
or representative designated by him for that purpose, any books, papers,
records or memoranda of the taxpayer bearing upon the matters required to be
included in any return. The Commissioner or such officers as he may designate
may require the attendance of the taxpayer or of any other person having
knowledge the premises, at any place in the county where the taxpayer or person
resides or has a place of business or in Washington County, if the taxpayer is
a nonresident individual or is a corporation not having a place of business in
this state, and may take testimony and require proof material for his
information, and may administer oaths or take acknowledgement in respect of any
return or other information required by Chapter 36 of Title 10, V.S.A., or the
rules, regulations and decisions of the Commissioner.
(b) Determination of Tax
If a return required by Chapter 36 of Title 10, V.S.A., is
not filed, or if a return when filed, is incorrect or insufficient, the amount
of tax due shall be determined by the Commissioner from any information
available. Notice of the determination shall be given to the person liable for
the payment of the tax. The determination shall finally and irrevocably fix the
tax thirty days after giving notice of the determination unless the person
against whom it is assessed shall apply in writing to the Commissioner for a
hearing, or unless the Commissioner of his own motion shall redetermine the
tax. After the hearing, the Commissioner shall give written notice of his
determination to the person against whom the tax is assessed.
(c) Review of Commissioner's Decision
(a) Any aggrieved taxpayer may,
within thirty days after any decision, order, finding, assessment or action of
the Commissioner made under Chapter 36 of Title 10, V.S.A., appeal to the
county court, by filing a petition of appeal with the county court as
prescribed by law and on giving security, approved by the Commissioner,
conditioned to pay the tax levied, if it remains unpaid, with interest and
costs, as set forth in subsection (c) of this section.
(b) The appeal provided by this section shall
be the exclusive remedy available to any taxpayer for review of a decision of
the Commissioner determining the liability of the taxpayer for the tax
imposed.
(c) Irrespective of any
restrictions on the assessment and collection of deficiencies, the Commissioner
may assess a deficiency after the expiration of the period specified in
subsection (a) of this section, notwithstanding that a petition of appeal
regarding the deficiency has been filed by the taxpayer, unless the taxpayer,
prior to the time of his portion of the deficiency (including interest and
other amounts) in respect of which the petition or appeal is made and all costs
and charges which may accrue against him in the prosecution of the proceeding,
including costs of all appeals, and with surety approved by the county court,
conditioned upon the payment of the deficency (including interest and other
amounts) as finally determined and all costs and charges. If as a result of a
waiver of the restrictions on the assessment and collection of a deficiency any
part of the amount determined by the Commissioner is paid after the filing of
the appeal bond, the bond shall, at the request of the taxpayer be
proportionately reduced.
Section
10.11724 Penalties; Interest; Late Filing Fees; Abatements;
Refunds
(a) Abatement of Tax Liabilities
The Commissioner may, upon making a record of his reasons
therefore, waive, reduce or compromise any of the tax, penalties or interest or
other amounts provided in Chapter 36 of Title 10, V.S.A., and these
regulations.
(b) Fee For
Late Filing
(i) When a taxpayer, without fraud
or willful intent to defeat or evade any tax liability imposed by this Chapter,
fails to file a return at the time prescribed, the taxpayer shall pay, at the
time that return is filed, without assessment or demand, in addition to the tax
liability due, if any, a late filing fee of $ 10.00 for each thirty days or
fraction thereof expiring before the filing of a proper return in accordancae
with these regulations. In no event shall such late filing fee exceed $ 50.00
or 50% of the tax, whichever is greater.
(ii) When a taxpayer fraudulently or with
willful intent to defeat or evade any tax liability imposed by Chapter 36 of
Title 10, V.S.A., fails to file a return at the time prescribed, the taxpayer
shall pay, at the time that return is filed, without assessment or demand, in
addition to the tax liability due, if any, a late filing fee of $ 25.00 for
each thirty days or fraction thereof expiring before the filing of a proper
return in accordance with these regulations. In no event shall such late filing
fee exceed 100% of the tax.
(c) Refunds
The Commissioner shall refund or credit any tax, penalty or
interest erroneously or illegally paid if application to the Commissioner for
the refund shall be made within two years from the thereof.
(d) Interest
Any person who shall fail to pay the tax imposed by Chapter
36 of Title 10, V.S.A., on or before the date when the same is required to be
paid (irrespective of any extensions granted) shall pay interest on said tax at
the rate of 1/2 of 1% each month or fraction thereof if the same remains
unpaid, to be calculated from the date the tax was required to be paid. All
such interest shall be payable to and recoverable by the Commissioner in the
same manner as is the tax imposed by Chapter 36 of Title 10, V.S.A. For
reasonable cause, the Commissioner may abate all or any part of such
interest.
(e) Penalties
(i) Whenever the tax assessed under Chapter
36 of Title 10, V.S.A., is unpaid, a penalty of 10% of the amount of such tax
as determined by the Commissioner shall be added to said assessment as well as
interest at the rate of 1% of such tax for each month or fraction of a month
during which the tax remains unpaid (irrespective of any extensions
granted).
(ii) Whenever any tax
assessed under Chapter 36 of Title 10, V.S.A., is unpaid due to negligence or
disregard of the provisions of Chapter 36 of Title 10, V.S.A., or of any ruling
or regulation of the Commissioner issued pursuant to the provisions of Chapter
36 of Title 10, V.S.A., but without intent to defraud, a penalty of 25% of the
amount of such tax as determined by the Commissioner shall be added to said
assessment as well as interest at the rate of 1% of such tax for each month or
fraction of a month during which the tax remains unpaid (irrespective of any
extensions granted). This penalty shall be in lieu of the penalty prescribed in
paragraph (i) of this subsection.
(iii) Whenever any tax assessed under Chapter
36 of Title 10, V.S.A., is unpaid due to fraud with intent to evade the tax, a
penalty of 50% of the amount of such tax as determined by the Commissioner
shall be added to said assessment as well as interest at the rate of 1% of such
tax for each month or fraction of a month during which the tax remains unpaid
(irrespective of any extensions granted). This penalty shall be in lieu of the
penalties prescribed in paragraphs (i) and (ii) of this subsection.
(iv) For reasonable cause the Commissioner
may waive or abate all or any part of such penalties and interest.
Section 10.11725 Record
Keeping; Notice; Limitations of Time
(a)
Records to be Kept
Every person required to pay the tax imposed by Chapter 36 of
Title 10, V.S.A., shall keep records of every sale of taxable beverage
containers and of amounts paid, charged or due thereon and of the tax payable
thereon. These records shall include a true copy of each sales slip, invoice,
receipt, statement or memorandum. The records shall be available for inspection
and examination at any time upon demand by the Commissioner or his duly
authorized agent or employee and shall be preserved for a period of three
years, except that the Commissioner may consent to their destruction within
that period or may require that they be kept longer.
(b) Notice
Any notice may be given by regular mail to the person for
whom it is intended in a postpaid envelope addressed to the person at the
address given in the last tax return filed by him or in any application made by
him or, if no return has been filed or application made, then to any address
obtainable. The mailing of the notice shall be presumptive evidence of its
receipt by the person to whom addressed. Any period of time which is determined
by the giving of notice shall commence to run from the date of mailing of the
notice.
(c) Limitation of
Time
(i) The provisions of law relating to
limitations of time for the enforcement of a civil remedy shall not apply to
any proceeding or action taken by the state or the Commissioner to levy,
appraise, assess, determine or enforce the collection of any tax or penalty
under Chapter 36 of Title 10, V.S.A. However, except in the case of a willfully
false or fraudulent return with intent to evade the tax, no assessment of
additional tax shall be made after the expiration of more than three years from
the date of the filing of a return; provided, however, that when no return has
been filed, the tax may be assessed at any time.
(ii) When, before the expiration of the
period prescribed herein for the assessment of an additional tax, a taxpayer
has consented in writing that the period be extended, the amount of the
additional tax due may be determined at any time within the extended period.
The period so extended may be further extended by subsequent consents in
writing made before the expiration of the extended period. If a taxpayer has
consented in writing to the extension of the period for assessment, the period
for filing an application for credit or refund shall not expire prior to six
months after the expiration of the period within which an assessment may be
made pursuant to the consent to extend the time for assessmesnt of additional
tax.
Section
10.11726 Enforcement and Collection
(a) Tax a Debt to the State
Any tax liability imposed by Chapter 36 of Title 10, V.S.A.,
becomes, for the time the tax liability is due and payable, a debt of the
taxpayer to the state.
(b)
Action to Collect Taxes; Limitations
Action may be brought by the attorney general of the state at
the instance of the Commissioner in the name of the state to recover the amount
of the tax liability of any taxpayer, if the action is brought within six years
after the date the tax liability was collectible. The action shall be
returnable in the county where the taxpayer resides or has a place of business,
and if the taxpayer neither resides nor has a place of business in this state,
the action shall be returnable in Washington County.
(c) Levy for Nonpayment
When all or any portion of a tax liability imposed by Chapter
36 of Title 10, V.S.A., is not paid within sixty days after it becomes
collectible, the Commissioner may issue a warrant under his hand and official
seal directed to the sheriff of any county of this state. The warrant shall
command the sheriff to levy upon and sell the real and personal property of the
taxpayer for the payment of the unpaid tax liability imposed by Chapter 36 of
Title 10, V.S.A., together with allowable fees and costs. The levy and sale
shall be effected in the manner, and shall be subject to the limitations,
prescribed for the levy, distraint and sale of property for the nonpayment of
town taxes under §§ 5191 through 5193 and §§
5253
through
5263
of Title 32, V.S.A. The sheriff shall return the warrant to the Commissioner
and pay to him the money collected thereunder within the time specified in the
warrant.
(d) Liability for
Failure or Delinquency
An individual, fiduciary, or officer or employee of any
corporation or partner or employee of any partnership, who, with intent to
evade any requirement of Chapter 36 of Title 10, V.S.A., or any lawful
requirement of the Commissioner hereunder, fails to pay or remit a tax
liability when due or to make, sign, verify or file a return when required to
do so, or to supply any information required by or under Chapter 36 of Title
10, V.S.A., or who, with like intent, makes, renders, signs, verifies or files
any false or fraudulent return or information, shall be fined not more than $
1,000.00 for each violation.
(e) Tax Liability as Property Lien
(i) If any corporation, partnership or
individual required to pay or remit any tax liability under Chapter 36 of Title
10, V.S.A., neglects or refuses to pay it in accordance therewith after
notification or assessment thereof, the aggregate amount of the tax liabiltiy
then due and owing, together with any costs that may accrue in addition
thereto, shall be a lien in favor of this state upon all property and rights to
property, whether real or personal, belonging to the corporation, partnership
or individual. The lien shall arise at the time the notification or assessement
is made by the Commissioner and shall continue until the aggregate tax
liability with costs is satisfied in full or becomes unenforceable by reason of
lapse of time. The lien shall be valid as against any subsequent mortgagee,
pledgee, purchaser, or judgment creditor when notice of the lien and the sum
due has been filed by the Commissioner with the clerk of the town or city in
which the property subject to lien is situated, or, in the case of an
unorganized town, gore or grant, in the office of the clerk of the county
wherein the property is situated. In the case of any prior mortgage on any real
or personal property so written as to secure a present debt and also future
advances by the mortgagee to the mortgagor, the lien herein provided, when
notice thereof has been filed in the proper clerk's office, shall be subject to
the prior mortgage unless the Commissioner also notifies the mortgagee of the
recording of the lien in writing, in which case any indebtedness thereafter
created from the mortgagor to the mortgagee shall be junior to the lien herein
provided for.
(ii) The Commissioner
shall issue to the taxpayer a certificate of release of the lien if:
(1) The Commissioner finds that the liability
for the amount demanded, together with costs, has been satisfied or has become
unenforceable by reason of lapse of time; or
(2) There is furnished to the Commissioner a
bond with surety approved by the Commissioner in a sum sufficient to equal the
amount demanded, together with costs, the bond to be conditioned upon the
payment of any judgement rendered in proceedings regularly instituted by the
Commissioner to enforce collection thereof at law or of any amount agreed upon
in writing by the Commissioner to constitute the full amount of the liability;
or
(3) The Commissioner determines
at any time that the interest of this state in the property has no
value.
(iii) The lien
provided for by this section may be foreclosed at any time after the tax
liability with respect to which the lien arose becomes collectible. In the case
of real property, the lien may be foreclosed in the manner prescribed in
§§ 4523 through 4530 of Title 12, V.S.A., and in such rules as the
Supreme Court may promulgate for the foreclosure of mortgages on real estate.
In the case of personal property, the lien may be satisfied in the manner
prescribed in Article 9 of Title 9A, V.S.A., for the disposition of collateral
under a security interest or in the manner provided by law for the foreclosure
of other security interests in personal property.
Section 10.11731 Deposit in Lieu
of Tax
The tax imposed by §
1172(a)
of Title 10, V.S.A., shall not be imposed if the taxpayer provides the
Commissioner with a certificate from the Vermont Agency of Environmental
Conservation certifying that such taxpayer is complying with the requirements
of §
1173
of Title 10, V.S.A.
Section
10.11733 Container
The word "container" means only closed, sealed (airtight)
containers and does not include vessels such as cups and glasses, even though
such vessels are used in connection with the sale of a beverage at an eating
and drinking establishment; nor does the word "container" include vessels which
have tops placed on them at the time of sale to the consumer for take-out
purposes at establishments such as restaurants, snack bars, and
drive-ins.
