2013 Louisiana Laws
Revised Statutes
TITLE 47 - Revenue and Taxation
RS 47:337.51.1 - Mandatory arbitration procedure

§337.51.1. Mandatory arbitration procedure

A.(1) Any taxpayer who receives an assessment in accordance with R.S. 47:337.48(B) resulting from an audit or whose request for a refund of such tax, penalty, and/or interest has been denied by a collector, may, in lieu of other remedies provided to him in this Chapter, timely initiate a mandatory arbitration proceeding in accordance with the provisions of this Section by mailing to the collector who is attempting to collect the tax, penalty, and/or interest a written request for mandatory arbitration.

(2) A proper, timely mailed request for mandatory arbitration shall suspend any collection action by the collector, and shall suspend the running of any prescription or other time limit or requirement to act in any provision of law or ordinance until the arbitration panel provided for in this Section has issued a final written decision, including but not limited to the time to respond to an ordinary suit; any remedy provided for in R.S. 47:337.45; a rule to cease business in R.S. 47:337.33; a payment under protest in R.S. 47:337.63; or auditing, examining or subpoena authority in R.S. 47:337.41, 337.42, and 337.43.

B.(1)(a) Upon receipt of the notification of the request for arbitration, the collector shall provide written notification to the secretary of the Department of Revenue and the Executive Director of the Louisiana Association of Tax Administrators of the pending arbitration proceeding.

(b)(i) The taxpayer and the collector shall each select one arbitrator from the registry of arbitrators provided for in Subparagraph (d) of this Paragraph within ten days of receipt of the notification of the request for arbitration. The two arbitrators selected shall then jointly agree on a third arbitrator to complete a panel of three. The arbitrators shall then select one of the three as a chief arbitrator.

(ii) If the two arbitrators selected are unable to jointly agree on a third arbitrator to complete the panel, they shall select one of themselves to be the chief arbitrator and may proceed with the arbitration, except that the decision of the panel must be agreed to by both arbitrators.

(iii) An arbitrator selected by either party may not have had any business relationship with either party within the last five years or at the time of selection be engaged in negotiations or other contacts with either party relative to entering into such a business relationship.

(c) In the event a taxpayer or a collector fails or refuses to comply with the arbitration procedure within the time periods provided for in this Subsection, plus any additional time as may be granted upon request by such party, the other party may appoint an arbitrator on behalf of such failing or refusing party.

(d)(i) Arbitrators for the panel shall be selected from the registry of arbitrators compiled in accordance with this Subsection.

(ii) The Board of Directors of the Louisiana Association of Tax Administrators shall annually appoint not less than ten arbitrators to the registry, each of whom shall be board certified tax administrators. In the event there are fewer than ten certified tax administrators available for such appointment, the board of directors may select any local sales tax administrator with at least five years experience in sales and use tax, provided such local sales tax administrator is not a party to the arbitration proceeding.

(iii) The Business and Industry Committee of the Louisiana Association of Tax Administrators, the Louisiana Association of Business and Industry, and the Society of Louisiana CPAs jointly shall appoint not less than ten arbitrators to the registry, each of whom shall possess at least five years of experience in the area of sales and use tax.

(2)(a) After his selection, the chief arbitrator shall provide a written request to the taxpayer and the collector for the submission of a detailed statement of fact or law in support of their positions and such other documents as the parties deem necessary, which are to be provided to each member of the panel and to the other party within thirty days of the date of the request.

(b) The chief arbitrator shall then designate a time and place for a hearing, unless a hearing is specifically waived in writing by both parties.

(c) All records, documentation, testimony, and other submissions related to the arbitration proceeding shall be subject to the provisions of R.S. 47:1508 et seq.

(3)(a)(i) After due consideration of the statements and documents provided to the panel, and any additional submissions required by the panel, and argument and evidence submitted at the hearing, the panel shall issue a written decision.

(ii)(aa) Decisions of the panel relating to common sales tax law as defined in R.S. 47:337.2(C)(1)(b) shall require consultation with the Department of Revenue prior to the rendering or issuance of the decision.

(bb)(I) Unless the panel is composed of two members as provided for in Item (1)(b)(ii) of this Subsection and therefore requires both members to agree on a decision, the decision shall be the opinion of at least a majority of the panel; provided that any dissenting panel member may submit reasons for dissent from the majority. The decision shall be rendered within sixty days of the conclusion of the hearing, or within sixty days of timely receipt of the statements and documents in the absence of a hearing.

(II) A written statement to the taxpayer and the collector by a panel composed of two members as provided for in Item (1)(b)(ii) of this Subsection of its inability to agree on a decision shall be treated as a decision of the panel for purposes of this Section.

(4) The parties to the arbitration proceeding provided for in this Section shall share equally in the cost of such proceeding, provided that each party shall bear its own respective costs of providing the necessary documentation, witnesses, travel, or other costs and expenses of the arbitration proceeding.

(5)(a) The decision of the panel shall be in writing and shall state the legal and factual reasons upon which the decision is based.

(b) A copy of the decision shall be sent to the taxpayer, the collector, the Executive Director of the Louisiana Association of Tax Administrators, and the secretary of the Department of Revenue.

C.(1)(a) The decision of the panel may be appealed by the collector or the taxpayer within thirty calendar days after the decision has been rendered and signed by filing a petition with the district court of the parish in which the political subdivision is located with a copy of the arbitration panel's decision attached and setting forth specifically any errors which may have been committed by the arbitration panel in reaching its decision.

(b) If the decision of the arbitration panel has found any tax, interest, or penalty to be due, and the taxpayer has not paid under protest as provided for in R.S. 47:337.63, the taxpayer shall post bond, with surety approved by the district court conditioned upon the payment of the tax as finally determined, together with any interest, additional amounts or additions to the tax provided for by law, payable to the collector, in an amount not to exceed one and one-half times the amount of the tax, interest, and penalty found to be due in the decision of the arbitration panel, and the posting of such bond shall be a condition precedent to any appeal for review in any district court.

(2) The appeal of the decision of the arbitration panel shall be a trial de novo; however, a court may consider the decision of the arbitration panel in rendering its decision on the appeal. The judgment of any such court shall be subject to further appeal, suspensive only, in accordance with law. If a suspensive appeal is taken from a judgment of the district court no further bond need be posted and the bond originally posted remains in full force and effect to guarantee the payment of any tax, interest, and penalty until final decision of the court.

(3)(a) If a decision of the arbitration panel is not appealed as provided for in this Section within thirty calendar days after the decision has been rendered and signed by the panel, it shall be binding on the parties. If it contains a finding that the taxpayer is liable for the payment of an amount of tax, interest, and penalty, such amount, if not in escrow pursuant to R.S. 47:337.63, shall be paid by the taxpayer upon notice and demand from the collector, and shall be collectible by distraint and sale, as provided in R.S. 47:337.57 through 337.60 or any other means provided for in Chapter 2-D of Subtitle II of Title 47 of the Louisiana Revised Statutes of 1950.

(b) When the decision of the arbitration panel which is not appealed contains a finding that the taxpayer is entitled to receive a refund or credit of an overpayment, the collector shall promptly enter the credit or make the refund, as the case may be.

D. Upon request of a taxpayer and upon proper showing by such taxpayer that the principle of law involved in an additional assessment is already pending before an arbitration panel pursuant to this Section, the taxpayer, upon agreement to abide by the decision of the arbitration panel or by a final judgment of a court upon a timely appeal of such decision, may make a written request to the collector that the additional assessment be included in the pending arbitration matter. If the collector agrees that the principle of law involved in the additional assessment is already pending before the arbitration panel, then the validity of such assessment shall be determined by the decision of the panel or by a final judgment of a court upon a timely appeal of such decision.

Acts 2010, No. 1003, §2, eff. Jan. 1, 2011.