The Fair Tax Act, Part XXXII
We’ll touch briefly on registration certificates again, then begin on penalties.
`SEC. 504. REGISTRATION CERTIFICATES.
`The sales tax administering authority shall issue certificates of registration to registered sellers and such other certificates as are necessary or may prove useful in the administration of the taxes imposed by this subtitle.
So the state tax authorities will issue pieces of paper to hang on your wall. Blah. Moving on to penalties! I will only cover a few at a time:
`SEC. 505. PENALTIES.
`(a) Failure To Register- Each person who is required to register pursuant to section 502 but fails to do so prior to notification by the sales tax administering authority shall be liable for a penalty of $500.
`(b) Reckless or Willful Failure To Collect Tax-
`(1) CIVIL PENALTY; FRAUD- Each person who is required to and recklessly or willfully fails to collect taxes imposed by this subtitle shall be liable for a penalty equal to the greater of $500 or 20 percent of tax not collected.
`(2) CRIMINAL PENALTY- Each person who is required to and willfully fails as part of a trade or business to collect taxes imposed by this subtitle may be fined an amount up to the amount determined in accordance with paragraph (1) or imprisoned for a period of not more than 1 year or both.
`(c) Reckless or Willful Assertion of Invalid Exemption-
`(1) CIVIL PENALTY; FRAUD- Each person who recklessly or willfully asserts an invalid intermediate or export sales exemption from the taxes imposed by this subtitle shall be liable for a penalty equal to the greater of $500 or 20 percent of the tax not collected or remitted.
`(2) CRIMINAL PENALTY- Each person who willfully asserts an invalid intermediate or export sales exemption from the taxes imposed by this subtitle may be fined an amount up to the amount determined in accordance with paragraph (1) or imprisoned for a period of not more than 1 year or both.
`(d) Reckless or Willful Failure To Remit Tax Collected-
`(1) CIVIL PENALTY; FRAUD- Each person who is required to and recklessly or willfully fails to remit taxes imposed by this subtitle and collected from purchasers shall be liable for a penalty equal to the greater of $1,000 or 50 percent of the tax not remitted.
`(2) CRIMINAL PENALTY- Each person who willfully fails to remit taxes imposed by this subtitle and collected from purchasers may be fined an amount up to the amount determined in accordance with paragraph (1) or imprisoned for a period of not more than 2 years or both.
So far the penalties to me don’t seem very strong, although on a large scale could amount so some significant money. What do you think?
