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ENGROSSED HOUSE AMENDME NT
TO
ENGROSSED SENATE BILL NO . 601 By: Rader of the Senate
and
Pfeiffer of the House
An Act relating to uniform tax procedure; amen ding 68
O.S. 2021, Sections 221, 226, 227, as amended by
Section 1, Chapter 11 4, O.S.L. 2022, and 231 (68 O.S.
Supp. 2022, Section 227), which relate to failure to
make report or return , action to recover taxes as
additional remedy, refund of erroneous payments, and
tax warrants; modifying the st art date for certain
deadlines to the date indicated on certain notice or
assessment; requiring certain warrant to be filed by
electronic means; and providing an effective date .
AMENDMENT NO. 1. Strike the title, enacting clause, and entire bill
and insert:
"An Act relating to cigarette and tobacco products;
amending 68 O.S. 2021, Sect ions 304 and 415, which
relate to licenses; modifying definition ; amending 68
O.S. 2021, Section 400.1, which relates to
enforcement of tobacco tax laws; providing for
membership of industry advisory committee; amending
68 O.S. 2021, Section 400.5, which relates to the
purchase of tobacco products; clarifying certain
enforcement procedure; amending 68 O.S. 2021, Section
417, which relates to seizure of untaxed tobacco
products; clarifying certain enforcement procedure;
providing an effective date; and declaring an
emergency.
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BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 68 O.S. 2021, Section 304, is
amended to read as follows:
Section 304. A. Every manufacturer and wholesaler of
cigarettes in this state, as a condition of carrying on such
business, shall annually secure from the Oklahoma Tax Commission a
written license, and shall p ay therefor an annual fee of Two Hundred
Fifty Dollars ($250.00). Application for such license, which shall
be made upon such forms as prescribed by the Oklahoma T ax
Commission, shall include the following:
1. The applicant’s agreement to the jurisdictio n of the Tax
Commission and the courts of this stat e for the purpose of
enforcement of the provisions of Section 301 et seq. of this title;
2. The applicant’s agre ement to abide by the provisions of
Section 301 et seq. of this title and the rules promulga ted by the
Tax Commission with reference thereto;
3. The wholesaler applicant’s agreement to sell cigarettes only
to licensed retailers or Indian tribal entities o r licensees of
Indian tribal entities; and
4. The manufacturer applicant's agreement to sel l cigarettes
only to a licensed wholesaler.
This license, which will be for the ensuing year, must at all
times be displayed in a conspicuous place so that it can b e seen.
Persons operating more than one place of business must secure a
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license for each place of business. "Place of business" shall be
construed to include the place where orders are received, or where
cigarettes are sold. A "place of business" cannot be a location
with a physical residential address. The Tax Commission shall not
issue a license for a place of business with a physical resid ential
address. If cigarettes are sold on or from any vehicle, the vehicle
shall constitute a place of business an d the regular license fee
shall be paid with respect thereto. However, if the vehicle is
owned or operated by a place of business for which the regular fee
is paid, the annual fee for the license with respect to such vehicle
shall be only Ten Dollars ($10 .00). The expiration for such vehicle
license shall expire on the same date as the curren t license of the
place of business.
Provided, that the Tax Commission shall not authorize the use of
a stamp-metering device by any manufacturer or wholesaler who doe s
not maintain a wareh ouse or wholesale establishment or place of
business within the Stat e of Oklahoma from which cigarettes are
received, stocked and sold and where such metering device is kept
and used; but the Tax Commission may, in its discretion, per mit the
use of such metering device by manufacturers and wholesalers of
cigarettes residing wholly within another state where such state
permits a licensed Oklahoma resident, manufacturer or wholesaler of
cigarettes the use of the metering device of such s tate without
first requiring that such manufacturer or wholesaler establish a
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place of business in such other state. The provisions of this
subsection relating to metering devices shall not apply to states
which do not require the affixing of tax stamps t o packages of
cigarettes before same are offered for sale in such states.
B. Every retailer in this state, except Indian tribal entities
or licenses of Indian tribal entities, as a condition of carrying on
such business, shall secure from the Tax Commissi on a license and
shall pay therefor a fee of Thirty Dollars ($30.00). Application
for such license, which shall be made upon such forms as p rescribed
by the Tax Commission, shall include the following:
1. The applicant’s agreement to the jurisdiction of the Tax
Commission and the courts of this state for the purpose of
enforcement of the prov isions of Section 301 et seq. of this title;
2. The applicant’s agreement to abide by the provisions of
Section 301 et seq. of this title and the rules promulgated b y the
Tax Commission with reference thereto;
3. The applicant’s agreement that it shall n ot purchase any
cigarettes for resale from a suppli er that does not hold a current
wholesaler’s license issued pursuant to this section; and
4. The applicant’s agree ment to sell cigarette s only to
consumers.
Such license, which will be for the ensuing thr ee (3) years,
must at all times be displayed in a c onspicuous place so that it can
be seen. Upon expiration of such license, the retailer to whom such
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license was issued may obtain a rene wal license which shall be valid
for three (3) years. The manner an d prorated fee for renewals shall
be prescribed by the Tax Commission. Every person operating under
such license as a retailer and who owns or operates more than one
place of business mus t secure a license for each place of business.
"Place of business" shall be construed to include places where
orders are received or where cigarettes are sold. A "place of
business" cannot be a location with a physical residential a ddress.
The Tax Commission shall not issue a license for a place of business
with a physical residential address.
C. Every distributing age nt shall, as a condition of carrying
on such business, pursuant to written application on a form
prescribed by and in such detailed form as the Tax Commission may
require, annually secure from the Tax Comm ission a license, and
shall pay therefor an annual fee of One Hundred Dollars ($100.00).
An application shall be filed and a license obtained for each place
of business owned or operated by a distributing agent. The license,
which will be for the ensuing year, shall be consecutively numbered,
nonassignable and nontransferable, and shall authorize the storing
and distribution of unstamped cigarettes within this state w hen such
distribution is made upon interstate orders only.
D. 1. All wholesale, retail, and distributing agent's licenses
shall be nonassignable and nontransferable from one person to
another person. Such licenses may be transferred from one location
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to another location after an application has been filed with the Tax
Commission requesting such transfer and after the approval of the
Tax Commission.
2. Wholesale, retail, and distributing agent's licenses shall
be applied for on a form prescribed by the T ax Commission. Any
person operating as a wholesaler, retailer, or distributing agent
must at all times have a valid license which has been issued by the
Tax Commission. If any such person or licensee continues to operate
as such on a license issued by th e Tax Commission which has expired,
or operates without ever having obtained from the Tax Commission
such license, such person or licensee s hall, after becoming
delinquent for a period in excess of fifteen (15) days, pay to the
Tax Commission, in addition to the annual license f ee, a penalty of
twenty-five cents ($0.25) per day on each delinqu ent license for
each day so operated in excess of f ifteen (15) days. The penalty
provided for herein shall not exceed the annual license fee for such
license.
E. No license may be granted, maintained or renewed if any of
the following conditions applies to the applicant. For purposes of
this section, "applicant" includes any combination of persons owning
directly or indirectly, in the aggregate, more than ten percent
(10%) of the ownership interests in the applicant:
1. The applicant owes Five Hundred D ollars ($500.00) or more in
delinquent cigarette ta xes;
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2. The applicant had a cigarette manufacturer, wholesaler,
retailer or distributor license revoked by the Tax Commission within
the past two (2) years;
3. The applicant has been convicted of a crime relating to
stolen or counterfeit cigarettes, or r eceiving stolen or counterfeit
cigarettes or has been convicted of or has entered a plea of guilty
or nolo contendere to any felony;
4. If the applicant is a cigarette manufacturer, the applicant
is neither:
a. a participating manufacturer as defined in S ection II
(jj) of the Master Settlement Agreement as defined in
Section 600.22 of Title 37 of the Oklahoma Statutes,
nor
b. in full compliance with the provisions of paragraph 2
of subsection A of Section 600.23 of Title 37 of the
Oklahoma Statutes;
5. If the applicant is a cigarette manufacturer, if any
cigarette imported by such applicant is imported into the United
States in violation of 19 U.S.C., Section 1681a; or
6. If the applicant is a cigarette m anufacturer, if any
cigarette imported or manufactu red by the applicant does not fully
comply with the Federal Cigarette Labeling and Advertising Act, 15
U.S.C., Section 1331 et seq.
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F. No person or entity licensed pursuant to the provisions of
this section shall purchase cigarettes from or sell cigarette s to a
person or entity required to obtain a license unless such person or
entity has obtained such license.
G. No person licensed as a retailer in this state shall:
1. Sell any cigarettes to any other p erson licensed as a
retailer in this state unless s uch sale is for the purpose of moving
inventory between stores which are part of the same company; or
2. Purchase any cigarettes from any person or entity other than
a wholesaler licensed pursuant to Sect ion 301 et seq. of this title.
H. In addition to a ny civil or criminal penalty provided by
law, upon a finding that a licensee has violated any provision of
Section 301 et seq. of this title, the Tax Commission may revoke or
suspend the license or license s of the licensee pursuant to the
procedures applicable to revocation of a license set forth in
Section 316 of this title.
I. The Tax Commission shall create and main tain a web site
setting forth all current valid licenses and the identity of
licensees holding such licenses, and shall update the site no l ess
frequently than once per month.
SECTION 2. AMENDATORY 68 O.S. 2021, Section 415, is
amended to read as follows:
Section 415. A. Every wholesaler of tobacco products in this
state, as a condition of carrying on such business, shall annually
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secure from the Oklahoma Tax Commission a written license and shall
pay an annual fee of Two Hundred Fifty Dollars ($250.00); provided,
such fee shall not be applicable if paid pursuant to Section 304 of
this title. The Tax Commission shal l promulgate rules which provide
a procedure for the issuance of a joint license for any wholesaler
making application pursuant to this section and Section 304 of this
title. Application for such license, which shall be made upon such
forms as prescribed by the Tax Commission, shall include the
following:
1. The applicant's agreement to the jurisdiction of the Tax
Commission and the courts of this state for purposes of enforcement
of the provisions of Sec tion 301 et seq. of this title; and
2. The applicant's agreement to abide by the provisions of
Section 301 et seq. of this title and the rules promulgated by the
Tax Commission with reference thereto. This license, which will be
for the ensuing year, mus t at all times be displayed in a
conspicuous place so that it can be seen. Persons operating more
than one place of business must secure a license for each place of
business. "Place of business" shall be construed to include the
place where orders are re ceived, or where tobacco products are sold.
A "place of business" cannot be a location with a physical
residential address. The Tax Commission shall not issue a licen se
for a place of business with a physical residential address. If
tobacco products are sold on or from any vehicle, the vehicle shall
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constitute a place of b usiness, and the license fee of Two Hundred
Fifty Dollars ($250.00) shall be paid with respect th ereto.
However, if the vehicle is owned or operated by a place of business
for which the regular license fee is paid, the annual fee for t he
license with respect to such vehicle shall be only Ten Dollars
($10.00). The expiration for such vehicle license shall expire on
the same date as the current license of the place of business.
B. Every retailer in this state, as a condition of carrying on
such business, shall secure from the Tax Commission a license and
shall pay therefor a fee of Thirty Dollars ($30 .00). Application
for such license, which shall be made upon such forms as prescribed
by the Tax Commission, shall include the following:
1. The applicant's agreement to the jurisdiction of the Tax
Commission and the courts of this state for purposes of enforcement
of the provisions of Section 301 et seq. of this title;
2. The applicant's agreement to abide by the provisions of
Section 301 et seq. of this ti tle and the rules promulgated by the
Tax Commission with reference thereto;
3. The applicant's a greement that it shall not purchase any
tobacco products for resale from a supplier that does not hold a
current wholesaler's license issue d pursuant to this s ection; and
4. The applicant's agreement to sell tobacco products only to
consumers.
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Such license, which will be for the ensuing three (3) years,
must at all times be displayed in a co nspicuous place so that it can
be seen. Upon expir ation of such licens e, the retailer to whom such
license was issued may obtain a renewal license which shall be valid
for three (3) years or until expiration of the retailer's sales tax
permit, whichever is earlier, after which a renewal license shall be
valid for three (3) y ears. The manner and prorated fee for renewals
shall be prescribed by the Tax Commission. Every person operating
under such license as a retailer and who owns or operates more than
one place of business must secure a license for each place of
business. "Place of business" shall be construed to include places
where orders are received or where tobac co products are sold. A
"place of business" cannot be a location with a physical reside ntial
address. The Tax Commission shall not issue a license for a plac e
of business with a physical residential address.
C. Nothing in this section shall be construed to prohibit any
person holding a retail license from also holding a wholesaler
license.
D. 1. All wholesale or retail licenses shall be nonassignable
and nontransferable from one person to another person. Such
licenses may be transferred from one locat ion to another location
after an application has been filed with the Tax Commission
requesting such transfer and after the approval of the Tax
Commission.
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2. Wholesale and retail licenses shall be applied for on a form
prescribed by the Tax Commission. A ny person operating as a
wholesaler or retailer must at all times have an effective unex pired
license which has been issued by the Tax Comm ission. If any such
person or licensee continues to operate as such on a license issued
by the Tax Commission which has expired, or operates without ever
having obtained from the Tax Commission such licen se, such person or
licensee shall, after becoming d elinquent for a peri od in excess of
fifteen (15) days, pay to the Tax Commission, in addition to the
annual license fee, a penalty of Ten Dollars ($10.00) per day on
each delinquent license for each day so operated in excess of
fifteen (15) days. The pena lty provided for her ein shall not exceed
the annual license fee for such license. The penalties collected
pursuant to the provisions of this paragraph shall be deposited in
the Tobacco Products Tax Enforc ement Unit Revolving Fund created in
Section 7 400.6 of this act title.
E. No license may be granted, maintained or renewed if any of
the following conditions apply to the applicant. For purposes of
this section, "applicant" includes any combination of p ersons owning
directly or indirectly, in the aggreg ate, more than ten p ercent
(10%) of the ownership interests in the applicant:
1. The applicant owes Five Hundred Dol lars ($500.00) or more in
delinquent tobacco products taxes;
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2. The applicant had a who lesaler or retailer license revoked
by the Tax Commission within the pa st two (2) years; or
3. The applicant has been convicted of a crime relating to
stolen or counterfeit tobacco products, or receiving stolen or
counterfeit tobacco products.
F. No person or entity licensed pursuant to the provisions of
this section shall purchase tobacco products from or sell tobacco
products to a person or entity required to obtain a license unless
such person or entity has obtained such license.
G. In addition to any civil or criminal penalty provided by
law, upon a finding that a licen see has violated any provision of
Section 301 et seq. of this title, the Tax Commission may revok e or
suspend the license or licenses of the licensee pursuant to the
procedures applicable to revocation of a license set forth in
Section 418 of this title.
SECTION 3. AMENDATORY 68 O.S. 2021, Section 400.1, is
amended to read as follows:
Section 400.1 A. For the purpose of enforcing the tobacco tax
laws of this state, the Oklahoma Tax Commission is authorized,
contingent upon the av ailability of funds, to establish and maintain
a unit to be known as t he "Tobacco Products Tax Enforcement Unit".
The unit shall enforce the tobacco tax laws of this state and ensure
that all taxes are paid on tobacco products by:
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1. Confirming that all entities selling tobacco products in
this state are properly licensed as provided in Section 400 et seq.
of Title 68 of the Oklahoma Statutes;
2. Verifying that all retailers are only purchasing tobacco
products from wholesalers licens ed by the Tax Commis sion;
3. Providing a dedicated telephone line and email address for
licensed wholesalers, licen sed retailers and the general public to
report suspected violations of tobacco tax laws; provided, no
entity, individual or those who report violations on behalf of a
licensed wholesaler or retailer shall be required to disclose t heir
identity;
4. Auditing licensed wholesalers and retailers to ensure all
tobacco product taxes are paid;
5. Issuing fines for violations as provided in Section 4 00 et
seq. of Title 68 of the Oklahoma Statutes;
6. Conducting wholesale and retail tobac co inspections to find
and confiscate untaxed tobacco products;
7. Establishing data-sharing programs with tax dep artments in
surrounding states related to tobacco p roduct taxes;
8. Creating an industry advisory committee including licensed
wholesalers and retailers who may represent the entity related to
tobacco products tax enforcement concerns and suggestions . The
industry advisory committee shall be composed of five (5) members as
follows:
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a. two members who are licensed wholesalers to be
appointed by the Governor,
b. one member who is a license d retailer to be appointed
by the President Pro Tempore of the Oklahoma Senate,
c. one member who is a licensed retailer to be appointed
by the Speaker of the Oklahoma House of
Representatives, and
d. one member who is a licensed wholesaler to be
appointed by the four members provided for in
subparagraphs a through c of this paragraph.
The committee shall meet quarterly. The Oklahoma Tax Commission
shall promulgate rules establishing the membership and minimum
requirements as may be deemed necessary t o carry out the purposes of
the committee; and
9. Working with law enforcement and conducting investigations
to stop illegal acquisition and s hipment of tobacco products by
persons not licensed to sell tobacco products in this state.
B. The Tax Commission shall annually submit a report to the
Governor, President Pro Tempore of the Senate and Speaker of the
House of Representatives listing the n umber of wholesale and retail
tobacco inspections conducted, the amount of untaxed tobacco
products confiscated, the number of tobacco products tax audits
conducted, the amount of taxes assessed and the amount of taxes
collected as the result of audits and confiscations, the number of
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suspected violations reported and the actions taken in response, and
the number of fines issued and the amount of fines collected.
SECTION 4. AMENDATORY 68 O.S. 2021, Section 400.5 , is
amended to read as follows:
Section 400.5 A. Retailers shall only purchase tobacco
products from an Oklahoma -licensed tobacco wholesaler evidenced by a
current listing provided by the Oklahoma Tax C ommission. All
purchase invoices shall contain the license number of the wholesaler
and shall be made available for ins pection by the Tax Commission.
Any purchases of tobacco produc ts from a person who is not holding a
current Oklahoma wholesale tobacco license shall be punishable by a
fine of the greater of One Thousand Do llars ($1,000.00) or five
times the unpaid tax on such products. The fine shall be in
addition to payment of an y unpaid tobacco products tax and the
forfeiture of any tobacco products to the State of Oklahoma as
provided by Section 414 of this title. A second or subsequent
offense shall be punishable b y revocation of the license. If the
retailer fails to pay a fi ne within thirty (30) days, the retailer's
license shall be suspended unt il the fine is paid in full.
B. The Oklahoma Tax Commission shall make available for all
licensed retailers a list of c urrently licensed wholesalers at least
monthly or through the u se of a website maintained by or on behalf
of the Oklahoma Tax Commission with updates made as often as
practical but no les s than every thirty (30) days.
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C. Fines collected pursuant to the pr ovisions of subsection A
of this section shall be deposited in the Tobacco Products Tax
Enforcement Unit Revolvin g Fund created in Secti on 7 400.6 of this
act title.
SECTION 5. AMENDATORY 68 O.S. 2021, Section 417, is
amended to read as follows:
Section 417. A. All tobacco products upon whi ch a tax is
levied by Section 400 et seq. of this title and all tobacco p roducts
sold, offered for sale or imported into thi s state in violation of
the provisions of Section 403.2 of this title , found in the
possession, custody or control of any person for the purpose of
being consumed, sold or transporte d from one place to ano ther in
this state, for the purpose of evading or v iolating the provisions
of Section 400 et seq. of this title, or with intent to avoid
payment of the tax imposed thereunder, and any vehicle being used in
avoidance of such tax may be seized by any authori zed agent of the
Oklahoma Tax Commission or any she riff, deputy sheriff or police
within the state. Tobacco products from the time of seizure shall
be forfeited to the State of Oklah oma and assessment of penal ty as
provided thereby and assessment for any delinquent taxes found to be
owing. A proper proceeding shall be filed to maintain such seizure
and prosecute the forfe iture as herein provided; the p rovisions of
this section shall not apply, however, where the tax on suc h tobacco
products does not excee d One Dollar ($1.00).
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B. All such tobacco products so seized shall first be listed
and appraised by the officer making such seizure and turned over to
the Tax Commission and a receip t taken therefor.
C. The person making such seizu re shall immediately ma ke and
file a written report thereof to the Tax Com mission, showing the
name of the person making such seizure, the plac e where seized, the
person from whom seized, the property seize d and an inventory and
appraisement thereof, which inventory shall be bas ed on the usual
and ordinary retail price or value of the articles seiz ed, and the
Attorney General, in the case of toba cco products sold, offered for
sale or imported into this state in violation of the provisions of
Section 403.2 of this title. Within sixty (60) days of seizure, the
person from whom the property was seized may file a request for
hearing with the Tax Comm ission or the Attorney General to show why
the seized property should not be forfeited and destroyed . If a
hearing is requested, the ow ner of the tobacco products shall be
given at least ten (10) days' notice of the hearing. If no request
for hearing is filed within the time provided, the property seized
will be forfeited and destroyed.
D. The seizure of such toba cco products shall not relieve the
person from whom such tobacco products were seized from pro secution
or the payment of penalties.
E. The forfeiture provisions of Sectio n 400 et seq. of this
title shall only apply to persons having possession of or
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transporting tobacco product s with intent to barter, sell or give
away the same.
SECTION 6. This act shall become effective July 1, 2023.
SECTION 7. It being immediately necessary for the preservation
of the public peace, health or safety, an emergency is hereby
declared to exist, by reason whereof t his act shall take e ffect and
be in full force from and after its passage an d approval.
Passed the House of Representatives the 26th day of April, 2023.
Presiding Officer of the House of
Representatives
Passed the Senate the ____ day of _______ ___, 2023.
Presiding Officer of the Senate
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ENGROSSED SENATE
BILL NO. 601 By: Rader of the Senate
and
Pfeiffer of the House
An Act relating to uniform tax procedure; amen ding 68
O.S. 2021, Sections 221, 226, 227, as amended by
Section 1, Chapter 11 4, O.S.L. 2022, and 231 (68 O.S.
Supp. 2022, Section 227), which relate to failure to
make report or return , action to recover taxes as
additional remedy, refund of erroneous payments, and
tax warrants; modifying the st art date for certain
deadlines to the date indicated on certain notice or
assessment; requiring certain warrant to be filed by
electronic means; and providing an effective date .
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 8. AMENDATORY 6 8 O.S. 2021, Section 221, is
amended to read as follows:
Section 221. A. If any taxpayer shall fail to make any report
or return as required by any state tax law, the Oklahoma Tax
Commission, from any information in i ts possession or obtainable by
it, may determine the correct amount of tax for the taxable period.
If a report or return has been filed, the Tax Commission shall
examine such report or return and make such audit or investigation
as it may deem necessary. If, in cases where no report or retu rn
has been filed, the Tax Commission determines that there is a tax
due for the taxable period, or if, in cases where a report or return
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has been filed, the Tax Commission shall determine that the tax
disclosed by such report or return is less than the ta x disclosed by
its examination, it shall in writing propose the assessment of taxes
or additional taxes, as the case may be, and shall mail a copy of
the proposed assessment to the taxpayer at the taxpayer ’s last-known
address. Proposed assessments made i n the name of the “Oklahoma Tax
Commission” by its authorized agents shall be considered as the
action of the Tax Commission.
B. Any assessment, correction or adjustment made as a result of
an office audit shall be pre sumed to be the result of an audit of
the report or return only, and such office audit shall not be deemed
a verification of any item in the report or return unless the item
shall have been made the subject of a hearing before the Tax
Commission, and the c orrectness and amount of such item de termined
at such hearing; and such office audit shall not preclude the Tax
Commission from subsequently making further adjustment, correction
or assessment as a result of a field audit of the books and records
of the taxpayer, wherever located, or upon dis closures from any
source other than the return. In cases where no report or return
has been filed, the assessment of the tax on any information
available shall in no event preclude the assessment at any time on
subsequently disclosed information.
C. Within sixty (60) days after the mailing of date indicated
on the aforesaid proposed assessment, the taxpayer may file with the
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Tax Commission a written protest under oath, signed by the taxpayer
or the taxpayer’s duly authorized agent, setting out therein:
1. A statement of the amount of deficiency as determined by the
Tax Commission, the nature of the tax and the amount thereof in
controversy;
2. A clear and concise assignment of each error alleged to have
been committed by the Tax Commission;
3. The argument and legal authority upon which each assignment
of error is made; provided, that the applicant shall not be bound or
restricted in such hearing, or on appeal, to the arguments and legal
authorities contained and cite d in the application;
4. A statement of relief sought by the taxpayer; and
5. A verification by the taxpayer or the taxpayer ’s duly
authorized agent that the statements and facts contained therein are
true.
D. If in such written protest the taxpayer sha ll request an
oral hearing, the Tax C ommission shall grant such hearing, and
shall, by written notice, advise the taxpayer of a date, which shall
not be less than ten (10) days from the date of mailing of such
written notice, when such taxpayer may appear before the Tax
Commission and present arguments and evidence, oral or written, in
support of the protest. Hearings shall be held as soon as
practicable. In the event an oral hearing is not requested, the Tax
Commission shall proceed without further notic e to examine into the
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merits of the protest and enter an order in accordance with its
findings. Upon request of any taxpayer and upon proper showing that
the principle of law involved in the assessment of any tax is
already pending before the courts for j udicial determination, the
taxpayer, upon agreement to abide by the decision of the court, may
pay the tax so assessed under protest and such protest shall be
resolved in accordance with the agreement to abide.
E. If the taxpayer fails to file a written p rotest within the
sixty-day period herein provided for or within the period as
extended by the Tax Commission, or if the taxpayer fails to file the
notice required by Section 226 of this title within thirty (30) days
from the date of mailing of an indicated on the proposed assessment,
then the proposed assessment, without further action of the Tax
Commission, shall become final and absolute . A taxpayer who fails
to file a protest to an assessment of taxes within the time period
prescribed by this section m ay, within one (1) year of the date t he
assessment becomes final, request the Tax Commission to adjust or
abate the assessment if the taxpayer can demonstrate, by a
preponderance of the evidence, that the assessment or some portion
thereof is clearly erron eous. If the Tax Commission determin es that
the proper showing has been made, the assessment or portion ther eof
determined to be clearly erroneous shall be deemed not to have
become final and absolute. No hearing to adjust or abate a clearly
erroneous assessment may be granted after the Tax Commission’s
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denial of such a request. An order of the Tax Commission denying a
taxpayer’s request to adjust or abate an assessment alleged to be
clearly erroneous is not an appealable order under Section 225 of
this title. No proceeding instituted by t he Tax Commission to
collect a tax liability may be stayed because of a request made by a
taxpayer to adjust or abate an assessment alleged to be clearly
erroneous.
F. The Tax Commission may in its discretion extend th e time for
filing a protest for any p eriod of time not to exceed an additional
ninety (90) days. Any extensi on granted shall not extend the period
of time within which the notice required by Section 226 of this
title may be filed.
G. Within a reasonable time after the hearing herein provide d
for, the Tax Commission shall make and enter an order in writing in
which it shall set forth the disposition made of the protest and a
copy of such order shall forthwith be mailed to the taxpayer. The
order shall contain findings of fact and conclusions of law. After
removing the identity of the taxpayer, the Tax Commissio n shall make
the order available for public inspection and shall publish those
orders the Tax Commission deems to be of precedential value. The
taxpayer may within the time and in the manner provided for by
Section 225 of this title, appeal to the Supreme Court, but in the
event the taxpayer fails to so proceed, the order shall within
thirty (30) days from the date a certified copy thereof is mailed to
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the taxpayer, become final. The provisions of Section 226 of this
title shall not apply where a proposed assessment or an assessment
of taxes has been permitted to become final.
H. In all instances where the proposed assessment or the
assessment of taxes or additional taxes has been per mitted to become
final, a certified copy of the assessment may be filed in the office
of the county clerk of any county in this state, and upon being so
filed, the county clerk shall enter same upon the judgment docket in
the same manner as provided for in connection with judgments of
district courts. When an assessment is so filed and docketed, it
shall have the same force and be subject to the same law as a
judgment of the district court, and accordingly it shall cons titute
a lien on any real estate of t he taxpayer located in the county
wherein filed; and execution may issue and proceedings in aid of
execution may be had the same as on judgments of district courts.
Such lien is hereby released and extinguished upon th e payment of
such assessment, or, exc ept as otherwise provided herein, upon the
expiration of ten (10) years after the date upon which the
assessment was filed in the office of the county clerk; provided,
the Tax Commission may, prior to the release and ex tinguishment of
such lien, refile the assessment one time in the office of the
county clerk. An assessment s o refiled shall continue the lien
until payment of the assessment, or upon the expiration of ten (10)
years after the date upon which the assessmen t was refiled in the
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office of the county clerk. The remedies provided in this
subsection shall be in additi on to other remedies provided by law.
All active liens evidenced by an assessment filed with a county
clerk’s office prior to November 1, 1989, sh all be released and
extinguished if the assessment is not refiled prior to November 1,
2001.
I. In order to make more definite the intention of the
Legislature in connection with the applicability or lack of
applicability of the refund provisions of the t ax statutes to those
treating with proposed assessments and assessments that have become
final, the Legislatu re being cognizant of the fact that such intent
has been questioned, it is declared to be the intent of the
Legislature that the refund provisions shall be without application
to taxes where the amount thereof has been determined by an
assessment, other th an an assessment designated as an “office
audit”, that has become final.
SECTION 9. AMENDATORY 68 O.S. 2021, Section 226, is
amended to read as follows:
Section 226. (a) A. In addition to the right to a protest of a
proposed assessment as authorized by Section 221 of this title, a
right of action is hereby created to afford a remedy to a taxpa yer
aggrieved by the provision s of this article or of any other sta te
tax law, or who resists the collection of or the enforcement of the
rules or regulations of the Tax Commission relating to the
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collection of any state tax; however, such remedy shall be limited
as prescribed by subse ction (c) C of this section.
(b) B. Within thirty (30) days from the date of mailing to the
taxpayer of indicated on an assessment for taxes or additional taxes
pursuant to Section 221 of this title by the Tax Commission, any
such taxpayer shall pay the tax to the Tax Commission, and at the
time of making such payment shall give notice to the Tax Commission
of his intention to file suit for recovery of such tax. The
taxpayer shall not be required to file suit within such thirty -day
period in order to prosecute an action as authorized by this
section; however, failure to file such suit within one (1) year from
the date of mailing of the assessment shall result in the assessment
becoming final and absolute. If the taxpayer prevails the Tax
Commission shall, by cash voucher drawn by the Tax Com mission upon
its official depository clearing account or special refund reserve
account with the State Treasurer, refund to the taxpayer the amount
of tax determined not to be due pursuant to the final judgm ent of
the court having jurisdiction, together wi th interest on such amount
at the rate applicable to money judgments in civil cases from the
date of payment by the taxpayer to the date of the refund by the Tax
Commission. The refunds paid shall be payab le as provided in
Section 225(d). If the taxpayer prevails and the court determines
that the position of the Tax Commission in the proceeding was not
substantially justified, the court shall award the taxpayer a
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judgment for reasonable attorney fees, reas onable expenses of expert
witnesses in connection with the proceeding and reasonable costs of
any study, analysis, engineering report, test , or project which is
found by the court to be necessary for the preparation of the
taxpayer’s case.
(c) C. This section shall afford a legal remedy and right of
action in any state or federal court having jurisdiction of the
parties and the subject matter. It shall be construed to provide a
legal remedy in the state or federal courts by action at law only in
cases where the taxes complained of are claimed to be an un lawful
burden on interstate commerce, or the collection thereof violative
of any Congressional Act or provision of the Federal Constitution,
or in cases where jurisdiction is vested in any of the Courts of the
United States. In all actions brought hereund er service of process
upon the Chairman of the Tax Commission shall be sufficient service,
and the Tax Commission shall be the sole, necessary and proper party
defendant in any such suit, and the State Treasure r shall not be a
necessary or proper party the reto.
(d) D. Upon request of any taxpayer and upon proper showing
that the principle of law involved in the assessment of any tax is
already pending before the courts for judicial determination, the
taxpayer, upon agreement to abide by the decision of the court, may
pay the tax so assessed under protest, but need not file a suit.
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SECTION 10. AMENDATORY 68 O.S. 2021, Section 227, as
amended by Section 1, Chapter 114, O.S.L. 2022 (68 O.S. Supp. 20 22,
Section 227), is amended to read as follows:
Section 227. A. Except as provided in subsection B of Section
1361.2 and subsection D of Section 1364.1 of this title, any
taxpayer who has paid to the State of Oklahoma, thr ough error of
fact, or computation, or misinterpretation of law, any tax collected
by the Tax Commission may, as hereinafter provided, be refunded the
amount of such tax so erroneously paid, w ithout interest.
B. 1. Except as otherwise provided by paragra ph 2 of this
subsection, any taxpayer who has so paid any such tax may, within
three (3) years from the date of payment thereof file with the Tax
Commission a verified claim for refund of suc h tax so erroneously
paid. The Tax Commission may accept an amen ded withholding tax o r
other report or return as a verifi ed claim for refund if the amended
report or return establishes a liability less than the original
report or return previously filed.
2. Upon August 26, 2016, with respect to the sales tax imposed
by Section 1354 of thi s title and with respect to the use tax
imposed by Section 1402 of this title, any taxpayer who has so paid
such sales or use tax may, within two (2) years from the date of
payment thereof file with the Tax Commission a verified claim for
refund of such tax so erroneously paid. The Tax Commission may
accept an amended sales or use tax report or return as a verified
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claim for refund if the amended report or return establi shes a
liability less than the original report or return previousl y filed.
C. The claim so filed with the Tax Commission, except for an
amended report or return, shall specify the name of the taxpayer,
the time when and period for which the tax was paid, the nature and
kind of tax so paid, the amount of the tax which th e taxpayer
claimed was erroneously paid, the grounds upon which a refund is
sought, and such other information or data relative to such payment
as may be necessary to an adjustment thereof by the Tax Commission.
It shall be the duty of the Commission to d etermine what amount of
refund, if any, is due as soon as practicable after such claim has
been filed and advise the taxpayer about the correctness of his
claim and the claim for refund sha ll be approved or denied by
written notice to the taxpayer.
D. If the claim for refund is denied, the taxpayer may file a
demand for hearing with the Commission. The demand for hearing must
be filed on or before the sixtieth day after the date indicated on
the notice of denial was mailed. If the taxpayer fails to file a
demand for hearing, the claim for refund shall be barred.
E. Upon the taxpayer’s timely filing of a demand for hearing,
the Commission shall set a date for hearing upon the claim for
refund which date shall not be later than sixty (60) days from the
date the demand for hearing was mailed. The taxpayer shall be
notified of the time and place of the hearing. The hearing may be
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held after the sixty-day period provided by this subsection upon
agreement of the taxpayer.
F. The provisions of this section shall not apply :
1. To refunds of income tax erroneously paid, refund s of which
tax shall be payable out of the income tax adjustment fund as
provided by law;
2. To estate tax because the payment o f such tax is covered by
an order of the Tax Commission and the estate and interested parties
are given notice that Commission ’s position and computation of the
tax will become final unless they protest and resist the payment
thereof as provided by statute ; nor
3. In any case where the tax was paid after an assessment
thereof was made by the T ax Commission which assessment became final
under the law.
SECTION 11. AMENDATORY 68 O.S. 2021, Section 231, is
amended to read as follows:
Section 231. A. If any tax, imposed or levied by any state tax
law, or any portion of suc h tax, is not paid before the same becomes
delinquent, the Oklahoma Tax Commission may immediately issue a
warrant under its official seal. A tax warrant directed to the
sheriff of any county of the state shall command the sheriff to levy
upon and sell without any appraisement or valuation any real or
personal property of the taxpayer found within the county for the
payment of the delinquent tax, interest , and penalties, and the cost
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of executing the warrant, and to return such warrant to the Tax
Commission, and to pay to it any monies collected by virtue thereof,
by a time to be therein specified, not more than sixty (60) days
from the date of the warrant.
B. The Tax Commission shall, immediately upon issuance of the
warrant, file with the county clerk of the county for which the
warrant was issued a copy thereof, and thereupon the county clerk
shall record and index such warrant in the same manner as judgments
using the name of the taxpayer named in the warrant, a short name
for the tax, the amount of the tax or portion thereof, and interest
and penalties for which the warrant was issued, and the date and
time when such copy was filed. The Tax Commission may shall file
the warrant in the appropriate office of the county clerk by
electronic means. The filing of the warrant in the office of the
county clerk of the county, shall constitute and be evidence and
notice of the state’s lien upon any interest in any real property of
the taxpayer against whom such warrant is issued, until such tax,
penalty and interest accruing thereon is paid. Such lien shall be
in addition to any and all other liens existing in favor of the
state to secure the payment of the unpaid tax, penalty, interest ,
and costs, and such lien shall be paramount and superior to all
other liens of whatsoever kind or cha racter, attaching to any of
said property subsequent to the date and time of such filing and
shall be in addition to any lien provided by Section 234 of this
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title. The Tax Commission shall, immediately upon issuance of the
warrant, mail, by regular mail, a copy of the warrant to the last-
known address of the delinquent taxpayer. Such lien is hereby
released and extinguished upon the payment of such tax, penalty,
interest, and costs, or, except as otherwise provided herein, upon
the expiration of ten (10) years after the date upon which the
warrant was filed with the county clerk; provided, the Tax
Commission may, prior to the release and extinguishment of such
lien, refile the warrant in the office of the county clerk. A
warrant so refiled shall continue the lien until payment of the tax,
penalty, interest, and costs, or upon the expiration of ten (10)
years after the date upon which the warrant was refiled and indexed
by the county clerk. All active liens evidenced by a warrant filed
with a county clerk’s office prior to November 1, 1989, shall be
released and extinguished if the warrant is not refiled prior to
November 1, 2001.
C. Except as otherwise provided in subsection D of this
section, the Tax Commission shall forward th e filed warrant to the
sheriff of the county in which the warrant was filed. Upon receipt
of the warrant, such sheriff shall thereupon proceed to execute the
tax warrant in the same manner prescribed by law for executions
against property upon judgment of a court of record; and such
sheriff shall execute and deliver to the purchaser a bill of sale or
deed, as the case may be.
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D. The Tax Commission shall not direct or forward to the
sheriff of any county any tax warrant issued pursuant to collection
by the Tax Commission. The Tax Co mmission shall promulgate rules
pertaining to tax warrants issued under this section.
E. The Tax Commission may levy upon and sell without any
appraisement or valuation any real or personal property of any
taxpayer identified b y a filed tax warrant. The Tax Commission may
execute the tax warrant in the same manner prescribed by law for
executions against property upon judgment of a court of record and
may execute and deliver to the purchaser a bill of sale or deed, as
the case may be.
F. Any purchaser, o ther than the State of Oklahoma, shall be
entitled, upon application to the court having jurisdiction of the
property, to have confirmation, the procedure for which shall be the
same as is now provided for the confirmation of a sale of property
under execution, of such sale prior to the issuance of a bill of
sale or deed. The State of Oklahoma shall be authorized to make
bids at any such sale to the amount of tax, penalty , and costs
accrued. In the event such bid is successful, the sheriff shall
issue proper muniment of title to the Tax Commission which shall
hold such title for the use and benefit of the State of Oklahoma;
and any taxpayer, or transferee of such taxpayer, shall have the
right, at any time within one (1) year fr om the date of such sale,
to redeem such property, upon the payment of all taxes, penalties
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and costs accrued to the date of redemption. Such applicant shall
not be entitled to a credit upon such taxes, penalties , and costs,
by reason of revenue that migh t have accrued to the State of
Oklahoma or other purchaser under sale, prior to such redemption.
After the expiration of the period of redemption herein provided,
the Tax Commission acting for the State of Oklahoma may sell such
property at public auction , upon giving thirty (30) days ’ notice,
published in a newspaper of general circulation in the county where
such property is located, to the highest and best bidder for cash;
and upon a sale had thereof, or when a redemption is made, the Tax
Commission, for and on behalf of the State o f Oklahoma, shall issue
its bill of sale or quit claim deed, as the case may be, to the
successful bidder or to the redemptioner. Such muniment of title
shall be executed by the Tax Commission, and attested by its
secretary, with the seal of the Tax Commi ssion affixed. The sheriff
shall be entitled to the same fee for services in executing the
warrant, as the sheriff would be entitled to receive if he or she
were executing an execution issued by the court clerk of the county
upon a judgment of a court of record.
G. If any sheriff shall refuse or neglect to levy upon and sell
any real or personal property of any taxpayer as directed by any
warrant issued by the Tax Commission, or shall refuse or neglect, on
demand, to pay over to the Tax Commission, its ag ents or attorneys,
all monies collected or received under any warrant issued by the Tax
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Commission, at any time after collecting or receiving the same, such
sheriff or other officer shall, upon motion of the Tax Commission in
court, and after thirty (30) d ays’ notice thereof, in writing, be
amerced in the amount for which any such warrant was issued by the
Tax Commission, together with all penalties and costs and with an
additional penalty of ten percent (10%) thereon, to and f or the use
of the State of Oklahoma. Every surety of any sheriff or officer
shall be made a party to the judgment rendered as aforesaid against
the sheriff or other officer.
H. The Tax Commission may expend funds from the Oklahoma Tax
Commission Fund in the State Treasury to reimburs e the sheriff for
travel and administrative costs actually and necessarily incurred
while performing duties required by this section. Such costs shall
be assessed against the delinquent taxpayer, shall be added to the
amount necessary to satisfy the tax w arrant, and upon collection
thereof shall be deposited in the Oklahoma Tax Commission Fund.
I. A tax warrant issued and filed under authority of this
section shall:
1. Constitute and be evidence and notice of the state ’s lien
upon real property; and
2. Not be subject to the provisions of any dormancy statute
which would limit the enforceability, effect , or operation of the
lien, except as otherwise provided in this section.
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J. After July 1, 1993, the Tax Commission shall no t issue any
certificates of indebtedness pursuant to the provisions of Section
230 of this title.
K. When a tax warrant has been issued and filed as provided in
this section, the Tax Commission shall have all of the remedies and
may take all of the procee dings thereon for the collectio n thereof
which may be had or taken upon a judgment of the district court.
SECTION 12. This act shall become effective November 1, 2023.
Passed the Senate the 28th day of February, 2023.
Presiding Officer of the Senate
Passed the House of Representatives the ____ d ay of __________,
2023.
Presiding Officer of the House
of Representatives