STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ST. PETERSBURG STEEL CORPORATION, )

)

Petitioner, )

)

vs. ) CASE NO. 81-2175

) STATE OF FLORIDA, DEPARTMENT OF ) REVENUE, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, K. N. Ayers, held a public hearing in the above- styled case on April 13, 1982, at St. Petersburg, Florida.

APPEARANCES

Petitioner was not represented. Frederick T. Esposito, President, St. Petersburg Steel Corporation, 4715 62nd Avenue North, Pinellas Park, Florida 33565, testified on behalf of Petitioner.

Jeff Kielbasa, Esquire, Department of Legal Affairs, The Capitol, Tallahassee, Florida 32301, represented the Respondent.

By Second Revised Notice of Proposed Assessment dated December 29, 1981, the Department of Revenue, Respondent, seeks $1,956.08 in taxes, penalties and interest through December 29, 1981, from St. Petersburg Steel Corporation, Petitioner. The assessment is based on sales and use taxes not remitted by Petitioner for the period 6/1/78 through 5/31/81.

The hearing in this case was initially scheduled for October 29, 1981, on a Notice of Proposed Assessment dated August 3, 1981, in which the Department of Revenue claimed some $5,300 due. At that hearing it was determined that Frederick T. Esposito was not qualified to represent Petitioner in these proceedings and his participation was limited to testifying on behalf of Petitioner. At the October 29, 1981, hearing Petitioner, after Notice of Proposed Assessment had been admitted into evidence, presented numerous invoices, bills of sale, and other documents showing the Notice of Proposed Assessment to be in error. At this point in the proceedings, the hearing was continued by the Hearing Officer to require the parties to review applicable documents and revise the assessment if necessary. One of the items produced by Petitioner at the October 29 hearing was a bill of sale for a truck purchased from a Florida dealer during the audit period and presumably registered in Florida, which Petitioner had not been able to locate while his records were being audited. The sales/use tax on this vehicle was included in the earlier assessment.

A First Revised Notice of Proposed Assessment alleged some $2,000 was due in uncollected sales tax and further review produced the Second Revised Notice of Proposed Assessment which reduced this figure to $788. This final proposed assessment claimed some $524 in use taxes on purchases for which Petitioner had been unable to produce receipts showing sales taxes paid.

At the instant hearing, Respondent called one witness, Mr. Esposito testified on behalf of Petitioner, and three exhibits were admitted into evidence.

FINDINGS OF FACT

1. St. Petersburg Steel Corporation is a Florida corporation which manufactures and sells steel products in Florida and to out-of-state purchasers. During the three-year audit period ending May 31, 1981, some $1.9 million was billed by Petitioner for sales made.

   
   

2. In conducting the audit for the period from June 1, 1978, through May 31, 1981, Respondent was provided all invoices and records of Petitioner. Due to the large volume of invoices involved, the auditor prepared the assessments by using Petitioner's sales register and did not check the entries therein with the source documents (invoices, bills of lading, sales slips, etc.). Some of the vendees were out of state, some were no longer in business, and the names of some could have been misread by the auditor since they were handwritten.

   
   

3. Unless Petitioner was able to present a resale certificate for a vendee or the sales register did not show the sales tax paid, that sale was included in the assessment. Some of those vendees were no longer in business and could not be located by Petitioner to obtain their resale certificate numbers.

   
   

4. Purchases for which Petitioner was assessed a use tax included some equipment such as fans and file cabinets and rent paid to its lessor on which Petitioner could not show a sales tax had been paid.

   
   

5. Petitioner contended that the audit was improperly conducted because the source documents were not used as the basis for the assessment. The only evidence presented to support this contention was the testimony of Esposito, who did not qualify as an expert witness able to credibly present such opinion testimony.

   
   

6. Petitioner further contended that he had remitted to Respondent some

   $1,900 in sales taxes improperly collected by him on out-of-state sales for which no tax was due. No claim for a refund of those taxes was made in these proceedings and no documentary evidence to support this contention was submitted by Petitioner.

   
   

   CONCLUSIONS OF LAW

   
   

7. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

   
   

8. Chapter 212, Florida Statutes, provides generally for the collection of sales tax on sales made within the state unless made to another dealer who provides the seller with a resale certificate number. It was primarily the failure of Petitioner to produce these resale certificate numbers that led to the assessment here involved.

9. Section 212.14, Florida Statutes, provides that the assessment levied by the Department of Revenue shall be deemed prima facie correct. That does not preclude the prima facie correctness of the assessment to be successfully rebutted by competent evidence that the audit from which the assessment was prepared was improperly or incorrectly done. Here Petitioner opined that the audit was improperly conducted because the source documents were not used. This bare assertion is insufficient to rebut the presumption of correctness that accompanies this assessment.

   
   

10. From the foregoing, it is concluded that St. Petersburg Steel Corporation was properly assessed $1,956.08 in taxes, penalties and interest as shown on Exhibit 1. It is, therefore,

RECOMMENDED that the Petition be dismissed and Petitioner pay the taxes as assessed.

ENTERED this 7th day of May, 1982, in Tallahassee, Florida.

K. N. AYERS, Hearing Officer Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 7th day of May, 1982.

COPIES FURNISHED:

Frederick T. Esposito, President St. Petersburg Steel Corporation Post Office Box 1158

4715 62nd Avenue North Pinellas Park, Florida 33565

Jeff Kielbasa, Esquire Department of Legal Affairs The Capitol

Tallahassee, Florida 32301

Robert A. Pierce, Esquire Department of Revenue

Room 104, Carlton Building Tallahassee, Florida 32301

Randy Miller, Executive Director Department of Revenue

Carlton Building Tallahassee, Florida

Docket for Case No: 81-002175

Orders for Case No: 81-002175