R & R Express v. Commonwealth
2012 Pa. Commw. LEXIS 58
| Pa. Commw. Ct. | 2012Background
- Taxpayer R & R Express challenges an assessment under the Motor Carriers Road Tax Act for 4/1/2001–3/31/2005 after an audit.
- Audit relies on missing/imperfect records, leading to estimated unreported miles and fuel usage.
- Taxpayer purchased all fuel at retail and seeks credit for taxes paid on fuel actually used.
- Agency disallowed credit for unsubstantiated/potentially unrecorded fuel purchases consistent with IFTA rules.
- Auditor used 4.0 miles per gallon where records were inadequate, and did not credit taxes on estimated fuel.
- Board of Finance and Revenue affirmed the assessment; Taxpayer appeals to the Commonwealth Court; standard of review is de novo.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether taxpayer credit for taxes paid on estimated fuel is allowed | R&R argues it paid tax on all fuel and estimates should be credited | Commonwealth contends credit requires adequate documentation for tax paid fuel | No; credit requires documentation; estimates not creditable under statute/IFTA. |
| Whether post-audit data can determine liability for prior period | Taxpayer urges using post-audit reports to reduce liability | Commonwealth says no statutory basis to apply post-audit data | Rejected; post-audit data cannot be used to adjust prior period liability. |
| Whether IFTA and Pennsylvania record-keeping requirements permit credits without documentation | Taxpayer claims sampling and data could credit fuel taxes | Documentation required; unsubstantiated purchases cannot receive credit | Documentation requirement controls; credits denied for unsubstantiated items. |
| Whether using default 4.0 mpg or audit-based estimates comply with statutory scheme | Taxpayer argues alternative estimation aligns with IFTA sampling | Default/mileage estimates required only when records inadequate; must follow statute/IFTA rules | Court rejects taxpayer method; adheres to statutory/IFTA framework. |
Key Cases Cited
- Fiore v. Commonwealth, 668 A.2d 1210 (Pa.Cmwlth.1995) (burden on taxpayer challenging assessment; deference to agency interpretations)
- Glatfelter Pulpwood Co. v. Commonwealth, 19 A.3d 572 (Pa.Cmwlth.2011) (de novo standard of review; agency interpretations контrolled)