June 14, 2005, Introduced by Rep. Sheen and referred to the Committee on Tax Policy.
A bill to amend 1941 PA 122, entitled
"An act to establish the revenue collection duties of the
department of treasury; to prescribe its powers and duties as the
revenue collection agency of the state; to prescribe certain powers
and duties of the state treasurer; to regulate the importation,
stamping, and disposition of certain tobacco products; to provide
for the transfer of powers and duties now vested in certain other
state boards, commissions, departments and offices; to prescribe
certain duties of and require certain reports from the department
of treasury; to provide procedures for the payment, administration,
audit, assessment, levy of interests or penalties on, and appeals
of taxes and tax liability; to prescribe its powers and duties if
an agreement to act as agent for a city to administer, collect, and
enforce the city income tax act on behalf of a city is entered into
with any city; to provide an appropriation; to abolish the state
board of tax administration; to prescribe penalties and provide
remedies; and to declare the effect of this act,"
by amending sections 3 and 4 (MCL 205.3, and 205.4), section 3 as
amended by 2003 PA 92 and section 4 as amended by 2002 PA 657.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. The department shall have all the powers and perform
the duties formerly vested in a department, board, commission, or
other agency, in connection with taxes due to or claimed by this
state and in connection with unpaid accounts or amounts due to this
state or any of its departments, institutions, or agencies that may
be made payable to or collectible by the department created by this
act. The department has the power and authority incidental to the
performance of the following acts, duties, and services:
(a) The state treasurer or a duly appointed agent of the state
treasurer
may examine the books, records, and papers touching
concerning the matter at issue of any person or taxpayer subject to
any tax, unpaid account, or amount the collection of which is
charged to the department. The state treasurer or a duly appointed
agent of the state treasurer may issue a subpoena requiring a
person
to appear and be examined with reference to concerning a
matter within the scope of the inquiry or investigation being
conducted by the department and to produce any books, records, or
papers. The state treasurer or a duly appointed agent, referee, or
examiner of the state treasurer may administer an oath to a witness
in any matter before the department. The department may invoke the
aid of the circuit court of this state in requiring the attendance
and
testimony of witnesses and the producing production of books,
papers, and documents. The circuit court of this state within the
jurisdiction of which an inquiry is carried on, in case of
contumacy or refusal to obey a subpoena, may issue an order
requiring the person to appear before the department and produce
books
and papers if so ordered and any evidence touching
concerning the matter in question if so ordered, and the failure to
obey the order of the court may be punished by the court as a
contempt. A person shall not be excused from testifying or from
producing any books, papers, records, or memoranda in any
investigation, or upon any hearing when ordered to do so by the
state treasurer, upon the ground that the testimony or evidence,
documentary or otherwise, may tend to incriminate or subject him or
her
to a criminal penalty. , however However, a person shall not
be
prosecuted or subjected to any criminal penalty for or on account
of
any transaction made or thing anything
concerning which he or
she may testify or produce evidence, documentary or otherwise,
before the department or its agent. A person testifying is not
exempt from prosecution and punishment for perjury committed while
testifying.
(b) After reasonable notice and public hearing, the department
may promulgate rules consistent with this act in accordance with
the administrative procedures act of 1969, 1969 PA 306, MCL 24.201
to 24.328, necessary to the enforcement of the provisions of tax
and other revenue measures that are administered by the department.
(c) The department may consult with the governor and the
legislature on the subject of taxation, revenue, and the
administration of the laws in relation to taxation and revenue, and
the progress of the work of the department, including the
furnishing of reports, information, and other assistance as the
governor may require.
(d) The department may investigate and study all matters of
taxation and revenue as the basis of recommending to the governor
and the legislature those changes and alterations in the tax laws
of
this state , as that
in the state treasurer's judgment may
bring about a more adequate and just system of state and local
taxation.
(e) The department may formulate a standard procedure that
requires the departments, commissions, boards, institutions, and
the agencies of this state that collect taxes, fees, or accounts
for this state to report all sums of money due and uncollected and
those uncollected items as prescribed by law and by the state
treasurer. The procedure prescribed in this subdivision shall
include a standard practice for receiving, receipting,
safeguarding, and periodically reporting all state revenue
receipts, whether current, delinquent, penalty, interest, or
otherwise, and the amounts, kinds, and terms of items either
collected, compromised, or still outstanding, to be summarized,
studied, and reported upon as the state treasurer considers
advisable.
(f) The department may periodically issue bulletins that index
and explain current department interpretations of current state tax
laws.
Beginning 90 days after the effective date of the amendatory
act
that added this sentence October 24, 2005, each bulletin or
letter ruling issued by the department on or after August 18, 2000
shall be published and made available to the public in printed and
electronic formats and on the department's website. The department
may charge a reasonable fee for subscriptions to this service not
to exceed the cost of printing. The money received from the sale of
subscriptions shall revert to the department and be placed in the
taxation manual revolving fund.
Sec. 4. (1) Not later than 1 year after the effective date of
this section, the department of treasury shall submit rules for a
public hearing pursuant to the administrative procedures act of
1969, 1969 PA 306, MCL 24.201 to 24.328, that provide for all of
the following:
(a) Standards to be followed by department officers and
employees for the fair and courteous treatment of the public, and a
system for monitoring compliance with those standards.
(b) The procedures governing an informal conference held under
section 21. These procedures shall include at least all of the
following:
(i) A method by which the department attempts to schedule the
informal conference at a mutually convenient time and place.
(ii) A requirement that the department include in the notice
for the informal conference the scope and nature of the subject of
the informal conference.
(iii) Authorization for the taxpayer at whose request the
informal conference is being held to make a sound recording of the
informal conference with prior notice to the department and for the
department to do the same with prior notice to the taxpayer.
(2) Not later than 1 year after the effective date of this
section, the department shall develop guidelines to govern
departmental employee responses to inquiries from the public and
standards for tax audit activities. The guidelines shall explicitly
exclude the use of a collection goal or quota for evaluating an
employee. The department shall assemble the guidelines required by
this subsection into an employee handbook. However, the handbook
shall not disclose information or parameters excluded from
disclosure under section 28(1)(f). The department shall distribute
the handbook to all departmental employees involved in the
collection or auditing of taxes and shall make the handbook
available to the public.
(3) the department shall publish a handbook for taxpayers and
tax preparers. The handbook shall be made available on the
department's website and at a reasonable cost, not to exceed the
actual cost of publication, and shall contain all of the following:
(a) The audit and collection procedures used by the
department.
(b) The procedures governing departmental communications with
taxpayers in the audit and collection process.