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CONTRACT NO. K-1213-77: A CONTRACT BY AND BETWEEN THE CITY OF NORMAN, OKLAHOMA, AND THE OKLAHOMA TAX COMMISSION TO ENGAGE IN SALES AND USE TAX COMPLIANCE ACTIVITIES.
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BACKGROUND: Businesses in Oklahoma that sell taxable goods are required to collect applicable state and municipal sales taxes from the purchasers of such goods. Those state and municipal taxes collected from the purchasers are then required to be remitted by the retailer to the Oklahoma Tax Commission. The Oklahoma Tax Commission then sends the taxes paid by the purchasers to the taxing entities. Historically, the OTC has been responsible for pursuing retailers that fail to remit the taxes collected from the purchasers to the OTC. Senate Bill (SB) 750 relating to the collection of sales tax was amended on May 26, 2011 to authorize municipalities to “engage in compliance activities, either directly or through contract with private persons or entities, to augment the collection of the municipal tax by the Tax Commission”. The Oklahoma Municipal League states that under the amended bill “municipalities will now have greater leeway to contact local merchants about compliance with the local sales tax ordinance.”
DESCRIPTION: The City of Norman could benefit financially from the implementation of delinquent sales, use and franchise tax collection programs authorized by SB 750. The Oklahoma Tax Commission (OTC) publishes a 60-day tax delinquency report which provides information on businesses within Norman that have collected sales taxes from purchasers but have failed to remit those collections to the OTC. However, the OTC often is unable to actively pursue collection of these overdue taxes.
SB 750 sets forth procedures for municipalities to follow in order to exercise the new authority to engage in compliance activity. One of the first actions is to contract with the (OTC) to engage in compliance activities. This contract is in addition and supplemental to the existing master ...
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