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DABT conducted a beverage surcharge tax audit for the
period July 1990 through December 1993. The DABT auditor
noted that Crabtree Investments did not keep very good
records and kept only sketchy inventory records. The
auditor used the wholesale distributors’ reports (DABT
Summary of Purchases) to determine the amount of alcohol
Crabtree Investments purchased. The DABT Summary of
Purchases is a listing of all items sold by alcohol
distributors to a particular licensee. Florida law
requires all wholesalers/distributors to report to the
DABT all alcohol purchases by a licensee/retailer.
Second, the Florida Department of Revenue conducted
a sales tax audit for the period November 1989 through
July 1995. The sales tax auditor used an indirect method
of reconstructing sales for taxable year 1993. She
obtained the amount of alcohol purchased from the DABT
Summary of Purchases and marked up the purchases to arrive
at the selling price. The auditor found that for 1993
“there was a $325,000 difference between the sales that
they reported to the Department of Revenue and the sales
as they were marked up based on AB & T’s numbers.”
Petitioners gave the sales tax auditor deposit slips,
weekly reports, and cash register tapes. The auditor found
that the original records of Crabtree Investments were not
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