In January, representatives in the Utah State Legislature introduced a piece of legislation — HB 232 — that would authorize a tax on sand and gravel extraction, as determined by the State Tax Commission.

Along with the tax, the bill would require a court surety bond. Individuals in the business of sand and gravel extraction who feel slighted by the tax requirement placed upon them by the commission have the option of contesting the tax in court.

However, Section 59-5-309 of the proposed legislation states the following.

“Before seeking judicial review, a taxpayer shall deposit with the commission the full amount of taxes, interest, and other charges audited and stated in the decision of the commission.”

Essentially, individuals contesting the tax must post a surety bond equivalent to the cumulative cost of the appeal, including the financial ramifications of a failed appeal. Surety bonds seek to protect consumers, and, in the case of HB 232, this requirement serves to ensure that the State Tax Commission does not enter into frivolous lawsuits every time it makes a decision.

Sponsored by Representative Douglas Sagers, the proposed bill must pass through multiple readings, votes in both the House and Senate and accrue a signature from Governor Gary Herbert before becoming law. To follow the bill’s progress, find it on Legiscan or check back for updates here on the Surety Bond Insider.

If you need a surety bond in Utah or any other state, contact SuretyBonds.com online 24/7 or by phone at 1 (800) 308-4358 Monday through Friday between 8 a.m. and 7 p.m. CST. You’ll be connected with a surety expert who will walk you through each step of the bonding process.