ENGROSSED SENATE
BILL NO. 1696	By:	Sykes of the Senate

			and

		McCullough of the House

[ delinquent sales tax - creating Delinquent Sales Tax Restitution Program - district attorney - codification - effective date ]

BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1.     NEW LAW     A new section of law to be codified in the Oklahoma Statutes as Section 215.4a of Title 19, unless there is created a duplication in numbering, reads as follows:
A.  Each district attorney shall create within the district attorney’s office a Delinquent Sales Tax Restitution Program and assign sufficient staff and resources for the efficient operation of the program.  Members of the district attorney’s staff shall perform duties in connection with the Delinquent Sales Tax Restitution Program in addition to any other duties which are assigned by the district attorney.
B.  Referral of a delinquent sales tax complaint to the Delinquent Sales Tax Restitution Program shall be at the discretion of the district attorney.  This act shall not limit the power of the district attorney to prosecute delinquent sales tax complaints.
C.  Upon receipt of a delinquent sales tax complaint, the district attorney shall determine if the complaint is one which is appropriate for referral to the Delinquent Sales Tax Restitution Program.  The determination shall be based on the following guidelines:
1.  The length of time of the delinquency;
2.  Whether or not there is a prior criminal record of the defendant;
3.  The number of delinquent sales tax complaints against the defendant previously received by the district attorney;
4.  Whether or not there are other delinquent sales tax complaints currently pending against the defendant; and
5.  The strength of the evidence of intent to defraud the government by not remitting the sales tax collected.
D.  Upon referral of a complaint to the Delinquent Sales Tax Restitution Program, a notice of the complaint shall be forwarded by mail to the defendant.  The notice shall include:
1.  The due date of the sales tax report and the approximate amount due based upon previous filings or reports;
2.  The name of the government agency making the referral;
3.  The date before which the defendant must contact the office of the district attorney concerning the complaint; and
4.  A statement of the penalty for embezzlement.
E.  1.  The district attorney may enter into a written restitution agreement with the defendant to defer prosecution on embezzlement for a period to be determined by the district attorney, not to exceed three (3) years, pending restitution being made to the Oklahoma Tax Commission as provided in this subsection.
2.  Each restitution agreement shall include a provision requiring the defendant to pay to the district attorney a fee, as follows:
a.	for a restitution agreement which covers less than six (6) sales tax reporting periods and delinquent sales taxes of less than Five Hundred Dollars ($500.00), an amount equal to the amount which would have been assessed as court costs upon the filing of the case in district court and an additional One Hundred Dollars ($100.00) for each sales tax reporting period covered by the agreement,
b.	for a restitution agreement which covers less than six (6) sales tax reporting periods and delinquent sales taxes of Five Hundred Dollars ($500.00) or more, an amount equal to the amount which would have been assessed as court costs upon the filing of a felony case in district court, an additional One Hundred Dollars ($100.00) for each sales tax reporting period covered by the agreement and an additional Two Hundred Dollars ($200.00), and
c.	for a restitution agreement which covers six (6) or more sales tax reporting periods, a fee as provided in subparagraphs a or b of this paragraph, as applicable, plus an additional fee equal to twenty-five percent (25%) of the total of the delinquent sales taxes and any penalty and interest owed.
3.  Restitution paid by a defendant to the office of the district attorney shall be deposited in a depository account in the office of the county treasurer to be disbursed to the Oklahoma Tax Commission by a warrant signed by the district attorney or a member of the staff assigned to the Delinquent Sales Tax Restitution Program.  The district attorney shall maintain full records of all restitution monies received and disbursed, which shall be audited at the same time that county funds are audited.
4.  If the defendant fails to comply with the restitution agreement, the district attorney may file an information and proceed with the prosecution of the defendant as provided by law.
F.  Each district attorney shall prepare and submit an annual report to the District Attorneys Council showing total deposits and expenditures for the Delinquent Sales Tax Restitution Program.
G.  By September 15 of each year, the District Attorneys Council shall publish an annual report for the previous fiscal year of the Delinquent Sales Tax Restitution Programs.  A copy of the report shall be distributed to the Governor, President Pro Tempore of the Senate, Speaker of the House of Representatives, the chair of the Senate Appropriations Committee and the chair of the House Appropriations and Budget Committee.  Each district attorney shall submit information requested by the District Attorneys Council regarding the Delinquent Sales Tax Restitution Program.  The report shall include, by county and by district, the:
1.  Number of tax debtors;
2.  Number of delinquent reporting periods processed;
3.  Total dollar amount of sales tax owed;
4.  Number of reporting periods for which some restitution was made;
5.  Total amount of restitution made;
6.  Total amount of fees collected;
7.  Total cost of the program; and
8.  Such other information as required by the District Attorneys Council.
SECTION 2.     AMENDATORY     68 O.S. 2011, Section 205.1, is amended to read as follows:
Section 205.1.  A.  To determine the actual municipal sales tax liability of any person engaged in any business upon which the Oklahoma excise tax is levied, the Oklahoma Tax Commission, notwithstanding the provisions of Section 205 of this title, shall, upon:
1.  Immediately notify the office of the appropriate district attorney of all sales tax delinquencies for which more than sixty (60) days has lapsed from the date of delinquency pursuant to Section 1365 of this title; and
2.  Upon request, make available reports to the governing body of each city or town that levies a municipal sales tax, which shall include, but not be limited to, the following information:
1.  A
a.	a full and complete list of the names and addresses of persons who report doing business during the preceding calendar year within the boundary of the city or town and who have a sales tax permit;,
2.  A
b.	a full and complete list of such persons specified in subparagraph a of this paragraph 1 of this subsection who are more than sixty (60) days delinquent in remitting sales tax levied pursuant to the provisions of the Oklahoma Sales Tax Code;,
3.  A
c.	a full and complete list of sales and use taxes collected by such persons specified in subparagraph a of this paragraph 1 of this subsection during the preceding calendar month;,
4.  A
d.	a full and complete list of taxpayers who were issued a sales tax permit for a location in the city or town the previous calendar month;, and
5.  A
e.	a full and complete list of taxpayers who have advised the Oklahoma Tax Commission that business at the location in the city or town was stopped during the previous calendar month.
B.  Upon request by the governing body of a city or town that levies a municipal sales tax, the Oklahoma Tax Commission, notwithstanding the provisions of Section 205 of this title, shall release to such governing body such information or evidence necessary to be used by such body to prosecute violations of municipal sales tax ordinances.  Such information or evidence shall include, but is not limited to, the following:
1.  Certified copies of sales tax permit applications;
2.  Certified copies of sales tax permits;
3.  Certified copies of sales tax reports; and
4.  Names of Tax Commission employees who may be potential witnesses for municipal prosecution purposes.
C.  Except in reporting to the members of the governing body of the city or town, no city or town official or employee shall divulge any information gained from the Oklahoma Tax Commission except that the municipal prosecutor and other municipal enforcement personnel may receive all information necessary to enforce municipal sales tax ordinances.
D.  Any city or town official or employee found in violation of this section shall be removed or dismissed from office in the manner provided by law.  In addition, any violation of the provisions of this section shall constitute a misdemeanor and shall be punishable by the imposition of a fine not exceeding One Thousand Dollars ($1,000.00) or by imprisonment in the county jail for a term not exceeding one (1) year, or by both said fine and imprisonment.
SECTION 3.     AMENDATORY     68 O.S. 2011, Section 218, is amended to read as follows:
Section 218.  A.  All remittances of taxes and fees under any state tax law or this Code, shall be made payable to the Oklahoma Tax Commission, at Oklahoma City, Oklahoma, by bank draft, check, cashier's check, money order, money, electronic funds transfer or nationally recognized credit or debit card.  The Tax Commission shall issue its receipt for cash or money payment to the taxpayer.  If payment is made by a credit or debit card, the Tax Commission may add an amount equal to the amount of the service charge incurred as a service charge for the acceptance of such card.  For purposes of this paragraph, "nationally recognized credit or debit card" means any instrument or device, whether known as a credit card, credit plate, charge plate, debit card, or by any other name, issued with or without fee by an issuer for the use of the cardholder in obtaining goods, services or anything of value on credit which is accepted by over one thousand merchants in this state.  The Tax Commission shall determine which nationally recognized cards will be accepted.  However, the Tax Commission must ensure that no loss of state revenue will occur by the use of such card.  The Tax Commission shall promulgate rules to allow for the orderly implementation of payment by credit or debit cards.
B.  No remittance other than cash shall be final discharge of liability due the Tax Commission unless and until it shall have been paid in cash.  All money collected shall be deposited with the State Treasurer to be distributed as provided by the state tax law under which the tax was levied.
C.  There shall be assessed, in addition to any other penalties provided for by law, an administrative service fee of Twenty‑five Dollars ($25.00) for each check returned to the Tax Commission or any agent thereof by reason of the refusal of the bank upon which such check was drawn to honor the same.  However, the fee provided in this subsection shall not be assessed for any check returned because of "insufficient funds" unless the check has been presented to the bank two times and payment declined by the bank.
D.  Upon the return of any check by reason of the refusal of the bank upon which such check was drawn to honor the same, the Tax Commission may file a bogus check complaint with the appropriate district attorney who shall refer the complaint to the Bogus Check Restitution Program established by Section 111 of Title 22 of the Oklahoma Statutes.  Funds collected through the program after collection of the fee authorized by Section 114 of Title 22 of the Oklahoma Statutes for deposit in the Bogus Check Restitution Program Fund in the county treasury shall be transmitted to the Tax Commission and credited to the tax liability for which the returned check was drawn and to the administrative service fee provided by this section.
E.  There shall be an assessment for matters referred to the district attorney pursuant to the Delinquent Sales Restitution Program as provided in Section 1 of this act.
F.  Any remittances for registration fees, license plates or decals or excise taxes as required by the provisions of the Oklahoma Vehicle License and Registration Act and Sections 2101 through 2110 of this title may be paid by a nationally recognized credit or debit card pursuant to the provisions of Section 1144 of Title 47 of the Oklahoma Statutes.
F. G.  For the convenience of taxpayers, the Tax Commission, through a contract between the State Treasurer and a financial institution, is authorized to place an automated teller machine in any facility owned or leased by the State and occupied by the Tax Commission.
SECTION 4.     AMENDATORY     68 O.S. 2011, Section 231.1, is amended to read as follows:
Section 231.1.  An additional penalty of Fifteen Dollars ($15.00) or an amount equal to ten percent (10%), but not to exceed Two Hundred Dollars ($200.00), of the total amount of tax, penalty and interest as stated on the face of a tax warrant, unless the actual liability at the date of issuance of the warrant is determined to be a lesser amount, whichever amount is greater, is hereby imposed upon each tax debtor who neglects, refuses or fails to pay delinquent taxes within sixty (60) days of the due date for that reporting period.  The additional penalty shall be added to and become a part of the total tax debt due the state and may be collected in the same manner as provided by law for collection of delinquent taxes.  Provided, however, the penalty imposed pursuant to this section shall not be assessed or collected more than once for the execution of a tax warrant in each county for the reporting period.
Upon collection of the additional penalty imposed herein, the Oklahoma Tax Commission shall transmit the revenue to the State Treasurer to be deposited in the Oklahoma Tax Commission Fund.  The revenue from the additional penalty collected by the sheriff shall be apportioned by the Oklahoma Tax Commission to the various county treasurers to be deposited in the appropriate fund of the county sheriff's department to be used by such department to increase efforts to locate tax debtors and their property, to execute upon tax warrants, and to collect delinquent taxes.  The revenue from the additional penalty collected by the Oklahoma Tax Commission shall be apportioned to the Oklahoma Tax Commission Fund to be used by the Oklahoma Tax Commission to enhance its efforts to collect delinquent taxes.  The additional penalty is imposed as a fee for the  collection of delinquent taxes by the sheriff, undersheriff, deputy sheriff, district attorney or Tax Commission.  The penalty is in addition to the reimbursement of actual and necessary travel and costs authorized in Section 231 of this title and any other fees which may be allowed by the district court.
SECTION 5.     AMENDATORY     68 O.S. 2011, Section 1364.3, is amended to read as follows:
Section 1364.3.  In order to increase the collection of sales and use taxes, the Oklahoma Tax Commission shall:
1.  Conduct hearings pursuant to Section 212 of Title 68 of the Oklahoma Statutes this title related to permits issued under the provisions of Section 1364 of Title 68 of the Oklahoma Statutes this title in at least two (2) locations in the state; and
2.  Add ten (10) additional sales and use tax audit and/or enforcement personnel as soon as practicable after July 1, 2011; and
3.  Immediately notify the appropriate district attorney of any delinquent sales taxes for which more than sixty (60) days has lapsed from the date of delinquency pursuant to Section 1365 of this title.
SECTION 6.     AMENDATORY     68 O.S. 2011, Section 1365, is amended to read as follows:
Section 1365.  When Tax Due - Reports - Records.
A.  The tax levied hereunder shall be due and payable on the first day of each month, except as herein provided, by any person liable to remit or pay any tax due under Section 1350 et seq. of this title the Oklahoma Sales Tax Code.  For the purpose of ascertaining the amount of the tax payable, it shall be the duty of all tax remitters, on or before the twentieth day of each month, to deliver to the Oklahoma Tax Commission, upon forms prescribed and furnished by it, sales tax reports signed under oath, showing the gross receipts or gross proceeds arising from all sales taxable or nontaxable under Section 1350 et seq. of this title the Oklahoma Sales Tax Code during the preceding calendar month.  Such reports shall show such further information as the Tax Commission may require to enable it to compute correctly and collect the tax herein levied.  In addition to the information required on reports, the Tax Commission may request and the taxpayer must furnish any information deemed necessary for a correct computation of the tax levied herein.  Such tax remitter shall compute and remit to the Tax Commission the required tax due for the preceding calendar month, the remittance or remittances of the tax to accompany the reports herein required.  If not filed on or before the twentieth day of such month, the tax shall be delinquent from such date.  Reports timely mailed shall be considered timely filed.  If a report is not timely filed, interest shall be charged from the date the report should have been filed until the report is actually filed.
B.  Effective July 1, 2001, every person owing an average of One Hundred Thousand Dollars ($100,000.00) or more per month in total sales taxes in the previous fiscal year shall remit the tax due and shall participate in the Tax Commission’s electronic funds transfer and electronic data interchange program, according to the following schedule:
1.  For sales from the first day through the fifteenth day of each month, the tax shall be due and payable on the twentieth day of such month and remitted to the Tax Commission by electronic funds transfer.  A taxpayer will be considered to have complied with the reporting requirements of this paragraph if, on or before the twentieth day of such month, the taxpayer paid at least ninety percent (90%) of the liability for that fifteen-day period or at least fifty percent (50%) of the taxpayer’s liability in the immediate preceding calendar year for the same month as the month in which the fifteen-day period occurs; and
2.  For sales from the sixteenth day through the end of each month, the tax shall be due and payable on the twentieth day of the following month and remitted to the Tax Commission by electronic funds transfer.
Every person required to remit the tax due pursuant to this subsection shall file its monthly sales tax report in accordance with the Tax Commission’s electronic data interchange program on the twentieth day of the month following the month the sales occurred.
Taxes not paid on or before the due dates specified in this subsection shall be delinquent from such dates.
C.  Effective March 1, 2002, every person owing an average of Twenty-five Thousand Dollars ($25,000.00) or more per month in total sales taxes in the previous fiscal year shall remit the tax due and shall participate in the Tax Commission’s electronic funds transfer and electronic data interchange program, according to the following schedule:
1.  For sales from the first day through the fifteenth day of each month, the tax shall be due and payable on the twentieth day of such month and remitted to the Tax Commission by electronic funds transfer.  A taxpayer will be considered to have complied with the reporting requirements of this paragraph if, on or before the twentieth day of such month, the taxpayer paid at least ninety percent (90%) of the liability for that fifteen-day period or at least fifty percent (50%) of the taxpayer’s liability in the immediate preceding calendar year for the same month as the month in which the fifteen-day period occurs; and
2.  For sales from the sixteenth day through the end of each month, the tax shall be due and payable on the twentieth day of the following month and remitted to the Tax Commission by electronic funds transfer.
Every person required to remit the tax due pursuant to this subsection shall file its monthly sales tax report in accordance with the Tax Commission’s electronic data interchange program on the twentieth day of the month following the month the sales occurred.  Provided, persons primarily engaged in selling lumber and other building materials, including cement and concrete, except for home centers classified under Industry No. 444110 of the North American Industrial Classification System (NAICS) Manual, shall remit and report as required in subsection A of this section, with the exception of taxes due on sales made during the periods of June 1 through June 15, 2002, which shall be remitted and reported on June 20, 2002, and June 1 through June 15, 2003, which shall be remitted and reported on June 20, 2003.
Taxes not paid on or before the due dates specified in this subsection shall be delinquent from such dates.
D.  Effective October 1, 2003, every person owing an average of Two Thousand Five Hundred Dollars ($2,500.00) or more per month in total sales taxes in the previous fiscal year shall remit the tax due and shall participate in the Tax Commission’s electronic funds transfer and electronic data interchange program, according to the following schedule:
1.  For sales from the first day through the fifteenth day of each month, the tax shall be due and payable on the twentieth day of such month and remitted to the Tax Commission by electronic funds transfer.  A taxpayer will be considered to have complied with the reporting requirements of this paragraph if, on or before the twentieth day of such month, the taxpayer paid at least ninety percent (90%) of the liability for that fifteen-day period or at least fifty percent (50%) of the taxpayer’s liability in the immediate preceding calendar year for the same month as the month in which the fifteen-day period occurs; and
2.  For sales from the sixteenth day through the end of each month, the tax shall be due and payable on the twentieth day of the following month and remitted to the Tax Commission by electronic funds transfer.
Every person required to remit the tax due pursuant to this subsection shall file its monthly sales tax report in accordance with the Tax Commission’s electronic data interchange program on the twentieth day of the month following the month the sales occurred.  Provided, persons primarily engaged in selling lumber and other building materials, including cement and concrete, except for home centers classified under Industry No. 444110 of the North American Industrial Classification System (NAICS) Manual, shall remit and report as required in subsection A of this section.
Taxes not paid on or before the due dates specified in this subsection shall be delinquent from such dates.
E.  In lieu of monthly reports, tax remitters or taxpayers who are classified as Group Three vendors in Section 1350 et seq. of this title the Oklahoma Sales Tax Code or tax remitters or taxpayers whose total amount of tax liability for any one month does not exceed Fifty Dollars ($50.00) may file semiannual reports and remit taxes due thereunder to the Tax Commission on or before the twentieth day of January and July of each year for the preceding six-month period.  If not paid on or before the twentieth day of such month, the tax shall be delinquent.
F.  It shall be the duty of every tax remitter required to make a sales tax report and pay any tax under Section 1350 et seq. of this title the Oklahoma Sales Tax Code to keep and preserve suitable records of the gross daily sales together with invoices of purchases and sales, bills of lading, bills of sale and other pertinent records and documents which may be necessary to determine the amount of tax due hereunder and such other records of goods, wares and merchandise, and other subjects of taxation under Section 1350 et seq. of this title the Oklahoma Sales Tax Code as will substantiate and prove the accuracy of such returns.  It shall also be the duty of every person who makes sales for resale to keep records of such sales which shall be subject to examination by the Tax Commission or any authorized employee thereof while engaged in checking or auditing the records of any person required to make a report under the terms of Section 1350 et seq. of this title the Oklahoma Sales Tax Code.  All such records shall remain in Oklahoma and be preserved for a period of three (3) years, unless the Tax Commission, in writing, has authorized their destruction or disposal at an earlier date, and shall be open to examination at any time by the Tax Commission or by any of its duly authorized agents.  The burden of proving that a sale was not a taxable sale shall be upon the person who made the sale.
G.  The purchaser must provide the vendor with the purchaser’s sales tax permit number, the direct payment permit number or a copy of the direct payment permit if the sale is made within Oklahoma.  In addition to furnishing the sales tax permit number to the vendor, the purchaser must certify in writing to the vendor that the purchaser is engaged in the business of reselling the articles purchased.  Failure to so certify, or to falsely certify with the knowledge that the items purchased are not for resale, shall be sufficient grounds upon which the Tax Commission may cause the purchaser’s sales tax permit to be canceled.  Certification may be made on the bill, invoice or sales slip retained by the vendor or by furnishing a certification letter to the seller which contains the following:
1.  The name and address of the purchaser;
2.  The sales tax permit number of the permit issued to the purchaser;
3.  A statement that the purchaser is engaged in the business of reselling the articles purchased, if applicable;
4.  A statement that the articles purchased are purchased for resale, if applicable; and
5.  The signature of the purchaser or a person authorized to legally bind the purchaser.
H.  If a sales tax permit holder purchases goods, wares and merchandise from a vendor on a regular basis, then the permit holder may furnish the certification letter described in subsection G of this section to the vendor and the vendor may subsequently make sales of tangible personal property to the permit holder without requiring a certification letter or certification statement for each subsequent sale.  The permit holder must notify the seller of all purchases which are not for resale and remit the applicable amount of tax thereon.  If the permit holder fails to notify the vendor of purchases not intended for resale, then sufficient grounds shall exist for the Tax Commission to cancel the sales tax permit of the permit holder who so failed to notify the vendor.
I.  In lieu of filing reports as required in subsection A of this section, tax remitters or taxpayers who agree to participate in the Tax Commission’s electronic funds transfer and electronic data interchange programs may file according to the following schedule:
1.  For sales from the first day through the fifteenth day of each month, the tax shall be due and payable on the twentieth day of such month and remitted to the Tax Commission by electronic funds transfer.  A taxpayer will be considered to have complied with the reporting requirements of this paragraph if, on or before the twentieth day of such month, the taxpayer paid at least ninety percent (90%) of the liability for that fifteen-day period or at least fifty percent (50%) of the taxpayer’s liability in the immediate preceding calendar year for the same month as the month in which the fifteen-day period occurs; and
2.  For sales from the sixteenth day through the end of each month, the tax shall be due and payable on the twentieth day of the following month and remitted to the Tax Commission by electronic funds transfer.
Every person required to remit the tax due pursuant to this subsection shall file its monthly sales tax report in accordance with the Tax Commission’s electronic data interchange program on the twentieth day of the month following the month the sales occurred.
Taxes not paid on or before the due dates specified in this subsection shall be delinquent from such dates.
J.  Sixty (60) days after the date taxes become delinquent pursuant to this section, a report of the delinquency shall be referred to the appropriate district attorney for further action.
SECTION 7.     AMENDATORY     68 O.S. 2011, Section 1368, is amended to read as follows:
Section 1368.  Bond or Security.
(A)  The Tax Commission may require every person who holds a sales tax permit pursuant to the provisions of the Oklahoma Sales Tax Code and is delinquent or becomes delinquent in the reporting or paying any taxes levied under this article or penalties or interest thereon to furnish to the Commission a cash bond, bond from a surety company chartered or authorized to do business in this state, certificates of deposits, certificates of savings or U.S. Treasury bonds, an assignment of negotiable stocks or bonds or such other security as the Commission may deem necessary to secure payment of taxes under this article.  Any surety bond furnished under this section shall be a continuing instrument and shall constitute a new and separate obligation in the sum stated therein for each calendar year or a portion thereof while such bond is in force.  Such bond shall remain in effect until the surety or sureties are released and discharged by the Tax Commission.  The Tax Commission shall fix the amount of such bond or other security required in each case after considering the tax liability expected to accrue, not to exceed three times the amount of the average quarterly tax liability. Provided, any taxpayer who reports and remits taxes hereunder on a semiannual basis and is or becomes delinquent in reporting or paying may be required to provide a bond or other security in an amount not to exceed three times the amount of the average semiannual tax liability.  Any bond or other security furnished shall be such as will protect this state against failure of the taxpayer to pay the tax levied by this article.
(B)  If any vendor fails or refuses to furnish a bond or other security as required by the Tax Commission within ten (10) days after mailing of notice thereof to said vendor, any authorized agent of the Tax Commission may remove the permit issued under this article from the taxpayer's premises and cause the same to be revoked.  The forfeiture or cancellation of such bond or security, for any reason whatsoever, shall automatically revoke the permit issued pursuant to the provisions of the Oklahoma Sales Tax Code.
(C)  All persons doing business in this state, classified as Group Three vendors under this article, shall make a sufficient cash deposit or sufficient bond with the Tax Commission as the Tax Commission may deem necessary to secure payment of the semiannual tax liability before doing business in this state or before receiving a permit to do business in this state as provided in this article.
D.  The posting of a bond or other security does not affect any referral to a district attorney or any requirements imposed by a district attorney under the Delinquent Sales Tax Restitution Program.
SECTION 8.     AMENDATORY     68 O.S. 2011, Section 1369, is amended to read as follows:
Section 1369.  (A)  All taxes levied in this article which are delinquent together with any penalty and interest thereon may be collected in the same manner as any other taxes imposed by law in addition to any remedies or penalties set out in this article or in the Delinquent Sales Tax Restitution Program.
(B)  All delinquent taxes levied in this article or penalties or interest and fees and costs provided in the Delinquent Sales Tax Restitution Program shall at all times constitute a priority lien upon the any property of any person determined to be liable for the payment thereof, which shall be a prior, superior and paramount lien as against the all claims of secured or unsecured creditors.
(C)  In case any city, town, county or other political subdivision of this state shall fail or refuse to pay the tax, or any part thereof, becoming due the state under the terms and provisions of this article from such city, town, county or other political subdivision, when due, the Tax Commission shall issue a warrant for the amount of the tax, penalty and interest, due just as in the case of delinquency of any other delinquent taxpayer who fails or refuses to pay the said tax; and the sheriff shall serve such warrant upon the county treasurer of the county in which such delinquent taxpayer is located and from the date of such service the same shall constitute and be a lien upon all ad valorem tax penalties collected by said treasurer for and on account of such delinquent taxpayer until the amount of such delinquent tax due by such taxpayer is paid; and the county treasurer upon whom such tax warrant is served is hereby directed and required to remit the amount of all such ad valorem tax penalty when collected by him to the Tax Commission until the amount due the state by the taxpayer, against whom such warrant was issued, is paid.
SECTION 9.     AMENDATORY     68 O.S. 2011, Section 1405, is amended to read as follows:
Section 1405.  A.  The tax levied by Section 1401 et seq. of this title is due and payable on the first day of each month for the preceding calendar month, and if not paid on or before the twentieth day of each month shall thereafter be delinquent.  Each taxpayer subject to the provisions of this article shall, on or before the twentieth day of every calendar month, file with the Oklahoma Tax Commission on forms to be furnished by the Tax Commission, a return verified by affidavit showing in detail the total purchase price of tangible personal property used by the taxpayer within the state during the preceding calendar month subject to the tax herein levied and such other information as the Tax Commission may require.  With each such return each taxpayer shall remit to the Tax Commission the amount of tax shown therein to be due.  Reports timely mailed shall be considered timely filed.  If a report is not timely filed, interest shall be charged from the date the report should have been filed until the report is actually filed.
B.  In lieu of monthly reports, tax remitters whose total amount of tax liability for any one (1) month does not exceed Fifty Dollars ($50.00) may file semiannual reports and remit taxes due thereunder to the Tax Commission on or before the twentieth day of January and July of each year for the preceding six-month period.  If not paid on or before the twentieth day of such month, the tax shall be delinquent.
C.  Effective March 1, 2003, every person owing an average of Twenty-five Thousand Dollars ($25,000.00) or more per month in total use taxes in the previous fiscal year shall remit the tax due and shall participate in the Tax Commission’s electronic funds transfer and electronic data interchange program, according to the following schedule:
1.  For taxes levied from the first day through the fifteenth day of each month, the tax shall be due and payable on the twentieth day of such month and remitted to the Tax Commission by electronic funds transfer.  A taxpayer will be considered to have complied with the reporting requirements of this paragraph if, on or before the twentieth day of such month, the taxpayer paid at least ninety percent (90%) of the liability for that fifteen-day period or at least fifty percent (50%) of the taxpayer’s liability in the immediate preceding calendar year for the same month as the month in which the fifteen-day period occurs; and
2.  For taxes levied from the sixteenth day through the end of each month, the tax shall be due and payable on the twentieth day of the following month and remitted to the Tax Commission by electronic funds transfer.
Every person required to remit the tax due pursuant to this subsection shall file its monthly use tax report in accordance with the Tax Commission’s electronic data interchange program on the twentieth day of the month following the month the tax is levied.  Provided, persons primarily engaged in selling lumber and other building materials, including cement and concrete, except for home centers classified under Industry No. 444110 of the North American Industrial Classification System (NAICS) Manual, shall remit and report as required in subsection A of this section, with the exception of taxes levied during the periods of June 1 through June 15, 2003, which shall be remitted and reported on June 20, 2003, and June 1 through June 15, 2004, which shall be remitted and reported on June 20, 2004.
Taxes not paid on or before the due dates specified in this subsection shall be delinquent from such dates.
D.  Effective October 1, 2003, every person owing an average of Two Thousand Five Hundred Dollars ($2,500.00) or more per month in total use taxes in the previous fiscal year shall remit the tax due and shall participate in the Tax Commission’s electronic funds transfer and electronic data interchange program, according to the following schedule:
1.  For taxes levied from the first day through the fifteenth day of each month, the tax shall be due and payable on the twentieth day of such month and remitted to the Tax Commission by electronic funds transfer.  A taxpayer will be considered to have complied with the reporting requirements of this paragraph if, on or before the twentieth day of such month, the taxpayer paid at least ninety percent (90%) of the liability for that fifteen-day period or at least fifty percent (50%) of the taxpayer’s liability in the immediate preceding calendar year for the same month as the month in which the fifteen-day period occurs; and
2.  For taxes levied from the sixteenth day through the end of each month, the tax shall be due and payable on the twentieth day of the following month and remitted to the Tax Commission by electronic funds transfer.
Every person required to remit the tax due pursuant to this subsection shall file its monthly use tax report in accordance with the Tax Commission’s electronic data interchange program on the twentieth day of the month following the month the tax is levied.  Provided, persons primarily engaged in selling lumber and other building materials, including cement and concrete, except for home centers classified under Industry No. 444110 of the North American Industrial Classification System (NAICS) Manual, shall remit and report as required in subsection A of this section, with the exception of taxes levied during the periods of June 1 through June 15, 2004, which shall be remitted and reported on June 20, 2004, and June 1 through June 15, 2005, which shall be remitted and reported on June 20, 2005.
Taxes not paid on or before the due dates specified in this subsection shall be delinquent from such dates.
E.  Sixty (60) days after the date taxes become delinquent pursuant to this section, a report of such delinquency shall be referred to the appropriate district attorney for further action.
SECTION 10.     AMENDATORY     68 O.S. 2011, Section 2702, is amended to read as follows:
Section 2702.  A.  The governing body of any county, incorporated city or town and the Oklahoma Tax Commission shall enter into contractual agreements whereby the Tax Commission shall have authority to assess, to collect and to enforce any taxes or, penalties or interest thereon, levied by such county, incorporated city or town, and remit the same to such county or municipality.  Said assessment, collection, and enforcement authority shall apply to any taxes, penalty or interest liability existing at the time of contracting.  Upon contracting, the Tax Commission shall have all the powers of enforcement in regard to such taxes, penalties and interest as are granted to or vested in the contracting county or municipality.  Such agreement shall provide for the assessment, collection, enforcement, and prosecution of such county or municipal tax, penalties and interest, in the same manner as and in accordance with the administration, collection, enforcement, and prosecution by the Tax Commission of any similar state tax except as provided by agreement.  Such agreement shall authorize the Tax Commission to retain an amount not to exceed one and three-fourths percent (1 3/4%) as a retention fee of county or municipal tax collected for services rendered in connection with such collections; provided, if a county or municipality files an action resulting in collection of delinquent state and county or municipal taxes, the Tax Commission shall remit one-half (1/2) of the retention fee applied to the amount of such taxes to the county or municipality to be apportioned as are other sales tax revenue.  All funds retained by the Tax Commission for the collection services to counties or municipalities shall be deposited in the Oklahoma Tax Commission Revolving Fund in the State Treasury.  The county or municipality shall agree to refrain from any assessment, collection, or enforcement of the county or municipal tax except as specified in an agreement made pursuant to subsections A, C, D and E of this section.
B.  The Tax Commission shall place all sales taxes, including penalties and interest, collected on behalf of a county or municipality pursuant to the provisions of this section and all use taxes, including penalties and interest, collected on behalf of a county or municipality pursuant to the provisions of Section 1411 of this title in the Sales Tax Remitting Account as provided in Section 1373 of this title.
C.  Notwithstanding the provisions of subsection E of this section, the Tax Commission and the governing body of any county or incorporated city or town may enter into contractual agreements whereby the county or municipality would be authorized to implement or augment the enforcement, collection and prosecution of the county or municipal tax in those contracting counties or municipalities and to provide for the satisfaction of refunds or credits to taxpayers.  Such agreements shall and are hereby authorized to provide that the county or municipality and the Tax Commission may exchange necessary information to effectively carry out the terms of such agreements.  The county or municipality, its officers and employees shall preserve the confidentiality of such information in the same manner and be subject to the same penalties as provided by Section 205 of this title, provided that the district attorney, municipal prosecutor and other county or municipal enforcement personnel may receive all information necessary to implement or augment the enforcement and prosecution of county or municipal sales tax ordinances.
D.  Provided further that, upon the request of any county, incorporated city or town, the Tax Commission shall enter into contractual agreements with such county or municipality whereby the county or municipality would be authorized to implement or augment the enforcement, either directly or through contract with private auditors or audit firms, of the county or municipal tax.  Any person performing an audit shall first be approved by the Tax Commission and, once approved, shall be appointed as an agent of the Tax Commission for purposes of the audit.  Contracts with a private auditor or audit firm shall not be subject to the limitations of Section 262 of this title and shall and are hereby authorized to provide that the county or municipality, private auditors or audit firms and the Tax Commission may exchange necessary information to effectively carry out the terms of such agreements.  The county or municipality, its officers and employees and private auditors or audit firms may receive all information necessary to perform audits and shall preserve the confidentiality of such information in the same manner and be subject to the same penalties as provided by Section 205 of this title.  Municipalities Counties or municipalities conducting audits directly or by contracting for private auditors or audit firms pursuant to this subsection shall furnish to the Tax Commission the audit results and all relevant supporting documentation.  Further, such municipalities shall provide for the payment of private auditors or audit firms by deduction from the tax assessment resulting from the audit conducted by said private auditors or audit firms unless a county or municipality contracts with the auditor or audit firm for another method of payment.  Any county or municipal sales tax funds recovered as a result of the services provided under this subsection will not be included in calculating the retention fee retained by the Tax Commission pursuant to subsection A of this section.  The contracts authorized by subsection A of this section shall provide that the Tax Commission shall not have any obligations thereunder to any county or municipality that does not participate in an audit conducted under this subsection.
E.  1.  Pursuant to the provisions of this subsection, upon the request of any county or municipality, the Tax Commission shall enter into a contractual agreement with the county or municipality whereby the county or municipality would be authorized to engage in compliance activities, either directly or through contract with private persons or entities, to augment the collection of the county or municipal tax by the Tax Commission.  The sole responsibility for the administration of any and all such compliance activities shall remain with the Tax Commission to ensure that sellers and purchasers shall only be required to register, file returns, and remit state and local taxes to one single authority, and that no enforcement activities are duplicated.
2.  Any contractual agreement entered into pursuant to paragraph 1 of this subsection and any person or entity who will be performing compliance activities shall first be approved by the Tax Commission in its sole discretion.  Once approved, the private person or entity shall be appointed as an agent of the Tax Commission for purposes of such compliance activities.  Any agreements entered into pursuant to paragraph 1 of this subsection shall provide that the county or municipality, private persons or entities appointed as an agent and the Tax Commission may exchange necessary information to effectively carry out the terms of the agreements.  The county or municipality, its officers and employees and any private person or entity appointed as an agent of the Tax Commission may receive all information necessary for compliance activities and shall preserve the confidentiality of the information in the same manner and be subject to the same penalties as provided by Section 205 of this title.  Municipalities Counties or municipalities conducting compliance activities directly or by contracting with private persons or entities pursuant to this subsection shall furnish to the Tax Commission the compliance results and all relevant supporting documentation and the Tax Commission shall take such information and issue proposed assessments or conduct other such administrative action as is necessary.
3.  There is hereby created in the State Treasury a revolving fund for the Oklahoma Tax Commission to be known as the “Tax Commission Compliance Fund”.  The fund shall be a continuing fund, not subject to fiscal year limitations, and notwithstanding any other provisions of law, shall consist of the first three-fourths of one percent (3/4 of 1%) of enhanced collections of state sales and use taxes collected pursuant to an agreement entered into pursuant to paragraph 1 of this subsection.  All monies accruing to the credit of the fund are hereby appropriated and may be budgeted and expended by the Oklahoma Tax Commission for the purpose of reimbursing a county or municipality for enhanced collections of state sales taxes pursuant to an agreement entered into pursuant to paragraph 1 of this subsection.  Expenditures from the fund shall be made upon warrants issued by the State Treasurer against claims filed as prescribed by law with the Director of State Finance for approval and payment.
4.  The Director of the Office of State Finance shall form an Implementation Working Group composed of representatives of municipalities and of the Tax Commission and shall adopt a plan to implement this subsection by September 30, 2011.  The plan shall ensure that the Tax Commission shall maintain a central point of collection and centralized administration and enforcement and further shall be consistent with all applicable state laws.
F.  Any sum or sums collected or required to be collected pursuant to a county or municipal sales tax levy shall be deemed to be held in trust for the county or municipality, and, as trustee, the collecting vendor shall have a fiduciary duty to the county or municipality in regards to such sums and shall be subject to the trust laws of this state.
G.  Nothing in this section shall limit the authority granted to a district attorney pursuant to the Delinquent Sales Tax Restitution Program.
SECTION 11.     AMENDATORY     68 O.S. 2011, Section 2703, is amended to read as follows:
Section 2703.  Any county or incorporated city or town may provide ordinance for the enforcement and collection of taxes assessed and levied by such county or municipality, including penal provisions and civil actions, to enforce payment brought in a court of competent jurisdiction.  Nothing in this section shall limit the authority granted to a district attorney pursuant to the Delinquent Sales Tax Restitution Program.
SECTION 12.  This act shall become effective November 1, 2012.
Passed the Senate the 13th day of March, 2012.

	
	Presiding Officer of the Senate

Passed the House of Representatives the ____ day of __________, 2012.

	
	Presiding Officer of the House
	of Representatives