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Monday, June 04, 2012

Ind. Decisions - "A legal tool that shut down an Indiana puppy mill likely won't be used again"

The ILB has had a long list of entries on the case of Indiana Department of State Revenue v. Virginia Garwood, et al.

As I wrote in this comprehensive May 20th entry, "The traditional press has not picked up on this ruling." Dan Carden of the NWI Times is the exception, he has had several stories in the past, which are cited in the above list of ILB entries.

In this entry from May 11th, I questioned a NWI Times story sentence: "A tool routinely used to shut down large dog breeding operations, sometimes called puppy mills, was scrutinized Thursday by the Indiana Supreme Court." However, in looking back at past entries (see this ILB entry from Dec. 25, 2010), it turns out that the jeopardy tax assessment process has been carried out at least three times by the AG's office - against breeders in Bloomfield, Cloverdale, and Mauckport (this last is the Garwood case).

Here is Carden's most recent NWI Times story, from June 2nd, headed "Puppy mill foes stymied by Indiana Supreme Court." A few quotes:

INDIANAPOLIS | A legal tool that shut down an Indiana puppy mill likely won't be used again after the Indiana Supreme Court let stand a Tax Court ruling that found the move exceeded state authority. * * *

The Indiana Tax Court ruled in August that the state exceeded its authority by using jeopardy assessments, which are intended to stop a person owing taxes from concealing property or fleeing the state. That the dogs were sold for far less than their value shows the state was not interested in collecting tax revenue but instead in shutting down a socially undesirable activity, Tax Court Judge Martha Wentworth said.

The five-member Supreme Court heard oral arguments in the case May 10. Eight days later, and without comment, the state's high court rescinded its review and restored the Tax Court ruling.

The Supreme Court's action does not prohibit future state use of jeopardy tax assessments. However, their value as a tool to close puppy mills is likely diminished even though the court's order is not precedent-setting. * * *

Attorney general's spokesman Bryan Corbin said the Garwood case wasn't about puppy mills but unpaid taxes. He said Indiana will continue to use every tool at its disposal to collect tax money it's owed.

"The state will not tolerate businesses that gain an unfair economic advantage over their competitors by willfully failing to pay their taxes," Corbin said.

In a separate criminal case, the Garwoods pleaded guilty to failure to collect sales taxes.

Posted by Marcia Oddi on June 4, 2012 09:19 AM
Posted to Ind. Sup.Ct. Decisions | Ind. Tax Ct. Decisions