Refunds and rebates of tobacco taxes; supporting documentation; distributor's
burden of proof
A. Except as otherwise provided under subsection B of this section or by
the department for a refund or redemption issued under section 42-3008 or
42-3460, a distributor requesting any refund or rebate of taxes paid on tobacco
products pursuant to article 2, 6, 7 or 9 of this chapter shall establish
entitlement to the refund or rebate by obtaining a report executed by
the retailer that purchased the tobacco products on which the distributor
paid taxes, indicating the name and address of the retailer and the quantities
of tobacco products sold, separately identified by the tax category of
tobacco product and the necessary facts to establish the appropriate amount
of refund or rebate. The report is subject to the following conditions:
1. The report shall be provided in the form and manner prescribed by the
department. Under such rules as it may prescribe, the department may identify
transactions for which a distributor may not rely solely on the information
in the retailer's report but must instead obtain additional information
as required by the rules in order to be entitled to the refund or rebate.
2. The burden of proof for the refund or rebate is on the distributor,
but if the distributor complies in all other respects with this section,
the department may require the retailer that caused the execution of the
report to establish the accuracy and completeness of the information required
to be contained in the report that would entitle the distributor to the
refund or rebate. If the retailer cannot establish the accuracy and completeness
of the information, the retailer is liable in an amount equal to any tax,
penalty and interest that the distributor would have been liable for under
this chapter if the distributor had not otherwise complied with this section.
Payment of the amount under this section by the retailer exempts the distributor
from liability for the underlying tax, penalty and interest. All amounts
paid by a retailer under this paragraph shall be treated as tax revenues
collected from the distributor in order to designate the distribution
base for the purposes of this chapter.
B. In its discretion and in circumstances where a retailer is uncooperative
or no longer in business, the department may accept proof other than a
report described in subsection A of this section if the distributor shows,
to the satisfaction of the department, that it exercised ordinary business
care and prudence but was unable to furnish a report executed by the retailer.
Acceptable forms of proof presented by the distributor pursuant to this
subsection must consist of books, records or papers maintained by the
distributor or retailer in the regular course of business.