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SENATE AMENDED
PRIOR PRINTER'S NOS. 1573, 1750
PRINTER'S NO. 2683
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1198
Session of
2015
INTRODUCED BY DUNBAR, BARRAR, GROVE, LAWRENCE, MILLARD, MURT,
MUSTIO, PEIFER, PETRI, REESE, GABLER, KORTZ, JOZWIAK, ADOLPH
AND BARBIN, MAY 13, 2015
SENATOR BROWNE, APPROPRIATIONS, IN SENATE, RE-REPORTED AS
AMENDED, DECEMBER 18, 2015
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," IN TAX FOR EDUCATION, FURTHER PROVIDING FOR
CRIMES; AND, in corporate net income tax, providing for
amended reports.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
the Tax Reform Code of 1971, is amended by adding a section to
read:
SECTION 1. SECTION 268(B) OF THE ACT OF MARCH 4, 1971
(P.L.6, NO.2), KNOWN AS THE TAX REFORM CODE OF 1971, AMENDED
JUNE 29, 2002 (P.L.559, NO.89), IS AMENDED AND THE SECTION IS
AMENDED BY ADDING SUBSECTIONS TO READ:
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SECTION 268. CRIMES.--* * *
(B) OTHER CRIMES. (1) EXCEPT AS OTHERWISE PROVIDED BY
SUBSECTION (A) OF THIS SECTION, ANY PERSON WHO ADVERTISES OR
HOLDS OUT OR STATES TO THE PUBLIC OR TO ANY PURCHASER OR USER,
DIRECTLY OR INDIRECTLY, THAT THE TAX OR ANY PART THEREOF IMPOSED
BY THIS ARTICLE WILL BE ABSORBED BY SUCH PERSON, OR THAT IT WILL
NOT BE ADDED TO THE PURCHASE PRICE OF THE TANGIBLE PERSONAL
PROPERTY OR SERVICES DESCRIBED IN SUBCLAUSES (2), (3), (4) AND
(11) THROUGH (18) OF CLAUSE (K) OF SECTION 201 OF THIS ARTICLE
SOLD OR, IF ADDED, THAT THE TAX OR ANY PART THEREOF WILL BE
REFUNDED, OTHER THAN WHEN SUCH PERSON REFUNDS THE PURCHASE PRICE
BECAUSE OF SUCH PROPERTY BEING RETURNED TO THE VENDOR, AND ANY
PERSON SELLING OR LEASING TANGIBLE PERSONAL PROPERTY OR SAID
SERVICES THE SALE OR USE OF WHICH BY THE PURCHASER IS SUBJECT TO
TAX HEREUNDER, WHO SHALL WILFULLY FAIL TO COLLECT THE TAX FROM
THE PURCHASER AND TIMELY REMIT THE SAME TO THE DEPARTMENT, AND
ANY PERSON WHO SHALL WILFULLY FAIL OR NEGLECT TO TIMELY FILE ANY
RETURN OR REPORT REQUIRED BY THIS ARTICLE OR ANY TAXPAYER WHO
SHALL REFUSE TO TIMELY PAY ANY TAX, PENALTY OR INTEREST IMPOSED
OR PROVIDED FOR BY THIS ARTICLE, OR WHO SHALL WILFULLY FAIL TO
PRESERVE HIS BOOKS, PAPERS AND RECORDS AS DIRECTED BY THE
DEPARTMENT, OR ANY PERSON WHO SHALL REFUSE TO PERMIT THE
DEPARTMENT OR ANY OF ITS AUTHORIZED AGENTS TO EXAMINE HIS BOOKS,
RECORDS OR PAPERS, OR WHO SHALL KNOWINGLY MAKE ANY INCOMPLETE,
FALSE OR FRAUDULENT RETURN OR REPORT, OR WHO SHALL DO, OR
ATTEMPT TO DO, ANYTHING WHATEVER TO PREVENT THE FULL DISCLOSURE
OF THE AMOUNT OR CHARACTER OF TAXABLE SALES PURCHASES OR USE
MADE BY HIMSELF OR ANY OTHER PERSON, OR SHALL PROVIDE ANY PERSON
WITH A FALSE STATEMENT AS TO THE PAYMENT OF TAX WITH RESPECT TO
PARTICULAR TANGIBLE PERSONAL PROPERTY OR SAID SERVICES, OR SHALL
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MAKE, UTTER OR ISSUE A FALSE OR FRAUDULENT EXEMPTION
CERTIFICATE, SHALL BE GUILTY OF A MISDEMEANOR, AND, UPON
CONVICTION THEREOF, SHALL BE SENTENCED TO PAY A FINE NOT
EXCEEDING ONE THOUSAND DOLLARS ($1000) AND COSTS OF PROSECUTION,
OR UNDERGO IMPRISONMENT NOT EXCEEDING ONE YEAR, OR BOTH:
PROVIDED, HOWEVER, THAT ANY PERSON MAINTAINING A PLACE OF
BUSINESS OUTSIDE THIS COMMONWEALTH MAY ABSORB THE TAX WITH
RESPECT TO TAXABLE SALES MADE IN THE NORMAL COURSE OF BUSINESS
TO CUSTOMERS PRESENT AT SUCH PLACE OF BUSINESS WITHOUT BEING
SUBJECT TO THE ABOVE PENALTY AND FINES: AND PROVIDED FURTHER,
THAT ADVERTISING TAX-INCLUDED PRICES SHALL BE PERMISSIBLE, IF
THE PREPAID SERVICES ARE SOLD BY THE SERVICE PROVIDER, FOR
PREPAID TELECOMMUNICATIONS SERVICES NOT EVIDENCED BY THE
TRANSFER OF TANGIBLE PERSONAL PROPERTY OR FOR PREPAID MOBILE
TELECOMMUNICATIONS SERVICES.
[(2) THE PENALTIES IMPOSED BY THIS SECTION SHALL BE IN
ADDITION TO ANY OTHER PENALTIES IMPOSED BY ANY PROVISION OF THIS
ARTICLE.]
(C) (1) NOTWITHSTANDING ANY OTHER PROVISION OF THIS PART,
ANY PERSON WHO PURCHASES, INSTALLS OR USES IN THIS COMMONWEALTH
AN AUTOMATED SALES SUPPRESSION DEVICE OR ZAPPER OR PHANTOMWARE
WITH THE INTENT TO DEFEAT OR EVADE THE DETERMINATION OF AN
AMOUNT DUE UNDER THIS PART COMMITS A MISDEMEANOR.
(I) ANY PERSON WHO, FOR COMMERCIAL GAIN, SELLS, PURCHASES,
INSTALLS, TRANSFERS OR POSSESSES IN THIS COMMONWEALTH AN
AUTOMATED SALES SUPPRESSION DEVICE OR ZAPPER OR PHANTOMWARE WITH
THE KNOWLEDGE THAT THE SOLE PURPOSE OF THE DEVICE IS TO DEFEAT
OR EVADE THE DETERMINATION OF AN AMOUNT DUE UNDER THIS PART
COMMITS AN OFFENSE WHICH SHALL BE PUNISHABLE BY A FINE SPECIFIED
UNDER SUBPARAGRAPH (II) OR BY IMPRISONMENT FOR NOT MORE THAN ONE
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YEAR, OR BY BOTH. A PERSON WHO USES AN AUTOMATED SALES
SUPPRESSION DEVICE OR ZAPPER OR PHANTOMWARE SHALL BE LIABLE FOR
ALL TAXES, INTEREST AND PENALTIES DUE AS A RESULT OF THE USE OF
THAT DEVICE.
(II) IF A PERSON IS GUILTY OF AN OFFENSE UNDER PARAGRAPH (1)
AND THE PERSON SOLD, INSTALLED, TRANSFERRED OR POSSESSED NOT
MORE THAN THREE AUTOMATED SALES SUPPRESSION DEVICES OR ZAPPERS
OR PHANTOMWARE, THE PERSON COMMITS AN OFFENSE PUNISHABLE BY A
FINE OF NOT MORE THAN FIVE THOUSAND DOLLARS ($5,000).
(III) IF A PERSON COMMITS AN OFFENSE UNDER PARAGRAPH (1) AND
THE PERSON SOLD, INSTALLED, TRANSFERRED OR POSSESSED MORE THAN
THREE AUTOMATED SALES SUPPRESSION DEVICES OR ZAPPERS OR
PHANTOMWARE, THE PERSON COMMITS AN OFFENSE PUNISHABLE BY A FINE
OF NOT MORE THAN TEN THOUSAND DOLLARS ($10,000).
(2) THIS SUBSECTION SHALL NOT APPLY TO A CORPORATION THAT
POSSESSES AN AUTOMATED SALES SUPPRESSION DEVICE OR ZAPPER OR
PHANTOMWARE FOR THE SOLE PURPOSE OF DEVELOPING HARDWARE OR
SOFTWARE TO COMBAT THE EVASION OF TAXES BY USE OF AUTOMATED
SALES SUPPRESSION DEVICES OR ZAPPERS OR PHANTOMWARE.
(3) FOR PURPOSES OF THIS SUBSECTION:
"AUTOMATED SALES SUPPRESSION DEVICE" OR "ZAPPER" MEANS A
SOFTWARE PROGRAM CARRIED ON A MEMORY STICK OR REMOVABLE COMPACT
DISC, ACCESSED THROUGH AN INTERNET LINK OR THROUGH ANY OTHER
MEANS, THAT FALSIFIES THE ELECTRONIC RECORDS OF ELECTRONIC CASH
REGISTERS AND OTHER POINT-OF-SALE SYSTEMS, INCLUDING, BUT NOT
LIMITED TO, TRANSACTION DATA AND TRANSACTION REPORTS.
"ELECTRONIC CASH REGISTER" MEANS A DEVICE THAT KEEPS A
REGISTER OR SUPPORTING DOCUMENT THROUGH THE MEANS OF AN
ELECTRONIC DEVICE OR COMPUTER SYSTEM DESIGNED TO RECORD
TRANSACTION DATA FOR THE PURPOSE OF COMPUTING, COMPILING OR
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PROCESSING RETAIL SALES TRANSACTION DATA IN WHATEVER MANNER.
"PHANTOMWARE" MEANS A HIDDEN PROGRAMMING OPTION, WHICH IS
EITHER PREINSTALLED OR INSTALLED AT A LATER TIME, EMBEDDED IN
THE OPERATING SYSTEM OF AN ELECTRONIC CASH REGISTER OR HARDWIRED
INTO THE ELECTRONIC CASH REGISTER THAT CAN BE USED TO CREATE A
VIRTUAL SECOND TILL OR MAY ELIMINATE OR MANIPULATE A TRANSACTION
RECORD THAT MAY OR MAY NOT BE PRESERVED IN DIGITAL FORMATS TO
REPRESENT THE TRUE OR MANIPULATED RECORD OF TRANSACTIONS IN THE
ELECTRONIC CASH REGISTER.
"TRANSACTION DATA" INCLUDES INFORMATION REGARDING ITEMS
PURCHASED BY A CUSTOMER, THE PRICE FOR EACH ITEM, A TAXABILITY
DETERMINATION FOR EACH ITEM, A SEGREGATED TAX AMOUNT FOR EACH OF
THE TAXED ITEMS, THE AMOUNT OF CASH OR CREDIT TENDERED, THE NET
AMOUNT RETURNED TO THE CUSTOMER IN CHANGE, THE DATE AND TIME OF
THE PURCHASE, THE NAME, ADDRESS AND IDENTIFICATION NUMBER OF THE
VENDOR AND THE RECEIPT OR INVOICE NUMBER OF THE TRANSACTION.
(D) THIS SECTION SHALL NOT PRECLUDE PROSECUTION UNDER ANY
OTHER LAW.
(E) THE PENALTIES IMPOSED BY THIS SECTION SHALL BE IN
ADDITION TO ANY OTHER PENALTIES IMPOSED BY ANY PROVISION OF THIS
ARTICLE.
SECTION 2. THE ACT IS AMENDED BY ADDING A SECTION TO READ:
Section 406.1. Amended Reports.-- (a) Except in instances
where either section 406 or subsection (b) applies, a taxpayer
may file an amended report on a form prescribed by the
department and under oath or affirmation to bring to the
attention of the department a correction to the original report
and provide additional information that the taxpayer requests
the department to consider, within three years after the filing
of the original report, including extensions.
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(b) (1) except in instances where a taxpayer would be
entitled to an adjustment of its tax liability, a taxpayer may
not file an amended report in lieu of a timely appeal of an
assessment.
(2) A taxpayer may file an amended report prior to the
actual receipt of an assessment or, if a petition raising other
issues is pending, during the administrative or judicial appeal.
(3) The department may issue proposed regulations within six
months of the effective date of this section that provide
guidance as to when a taxpayer may file an amended report in
lieu of a timely appeal of an assessment.
(c) (1) In order for the department to consider an amended
report, a taxpayer must consent in writing, on a form prescribed
by the department, to the extension of the assessment period for
the tax year to one year from the date of the filing of the
amended report or three years from the filing of the original
report, whichever period last expires.
(2) At any time before the expiration of the applicable
statute of limitations, a taxpayer may consent to extend the
period for the department to consider an amended report.
(3) A taxpayer shall maintain records until the end of the
extended assessment period.
(d) An amended report filed with the department must contain
the following:
(1) An agreement to the extension of the assessment period
as described in subsection (c) .
(2) The calculation of the amended tax liability.
(3) Revised Pennsylvania supporting schedules, if
applicable.
(4) An explanation of the changes being made and the reason
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for the changes.
(5) Other information that the department may request to
support the calculation of the amended tax liability.
(e) (1) The department shall review an amended report filed
prior to the issuance of an assessment.
(2) If the department subsequently issues an assessment, any
appeal of the taxpayer must be filed in accordance with section
2703 and include any issues raised in the amended report with
which the taxpayer disagrees with the action of the department.
(3) If the department does not issue an assessment and the
taxpayer disagrees with the department's action on the amended
report, the taxpayer may file an appeal pursuant to subsection
(h).
(f) An amended report involving a tax year under appeal
shall be forwarded to the appropriate administrative appeal
board or to the Office of Attorney General to be included in the
appeal.
(g) (1) Unless the taxpayer has requested or consented to
an extension, the department shall review an amended report and
advise the taxpayer in writing within one year of the filing
date of the amended report whether the department accepts the
amended report. The notice shall provide an explanation of the
department's action.
(2) If the department fails to provide timely notice, the
amended report shall be deemed accepted as filed and the
department shall adjust its records accordingly.
(h) (1) Except where:
(i) an amended report has been incorporated into an
administrative or judicial proceeding;
(ii) an assessment is issued after consideration of an
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amended report;
(iii) an amended report is filed in lieu of a petition for
reassessment; or
(iv) an amended report requesting a refund or credit was
filed more than three years from the date the applicable tax was
paid or deemed paid.
A taxpayer who disagrees with the action of the department may
file an appeal with the board of appeals within ninety days of
the mailing date of the written notice required in subsection
(g).
(2) A taxpayer may not appeal the department's action on an
amended report:
(i) filed in lieu of a petition for reassessment; or
(ii) requesting a refund or credit filed more than three
years from the date the applicable tax was paid or deemed paid.
(3) If a taxpayer disagrees with the action of the
department, in the instance where:
(i) an amended report was filed in lieu of a petition for
reassessment; or
(ii) the taxpayer had the right to pay the assessed tax,
interest and penalty and file a petition for refund or credit
instead of an amended report.
The taxpayer may pay the tax, interest and penalty due and file
a petition for refund in accordance with section 3003.1.
(i) This section applies to all taxes that incorporate by
reference Part III of this article.
Section 2 3. The addition of section 406.1 of the act shall
apply to amended reports filed on or after the effective date of
this section.
Section 3 4. This act shall take effect immediately.
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