2.7.1105: TRANSACTIONS, COMMODITIES SUBJECT TO TAX LIENS:
A. Business Purchases: If the purchaser of a business or stock of goods shall fail to withhold the required amount of purchase money as required by section 2.7.605 of this article and the tax remains due and unpaid after the ten (10) day period allowed, the purchaser, as well as the seller, shall be personally liable for the payment of the taxes unpaid by the former owner. Likewise, any person who takes any stock of goods or business fixtures of or used by any retailer under lease, title-remaining contract or other contract arrangement, by purchase, foreclosure sale, or otherwise, takes same subject to the lien for any delinquent sales and use taxes owned by the seller, and shall be liable for the payment of all delinquent sales taxes of the prior owner, not, however, exceeding the value of the property so taken or acquired.
B. Construction And Building Materials: The full amount of any tax due and not paid for lumber, fixtures or any other building materials and supplies, together with penalties and interest thereon as provided, shall constitute a lien upon the real property benefitted by the work. The Director is hereby authorized to file a notice of the lien with the County Clerk and Recorder of El Paso County.
C. Personal Property Affixed To Real Property: The full amount of unpaid taxes arising from and required to be paid on personal property affixed to real property under this City Tax Code together with interest and penalties, shall constitute a first and prior lien on the real property and any proceeds therefrom, which lien shall have precedence over all other liens of whatsoever kind and nature except as to liens for general taxes created by State law and except as to preexisting claims or liens of a bona fide mortgagee, pledgee, judgment creditor or consumer whose rights shall have attached prior to the filing of the notice of tax lien on the property of the taxpayer other than on the goods, stock-in-trade and business fixtures of the taxpayer.
D. Consignments Subject To Tax Lien: The liens created on merchandise shall extend not only to any and all merchandise belonging to the retailer who is in default on payment of the sales and use tax but also to any merchandise held on consignment. If the retailer applies to the Director for permission to separate the tax accounts of merchandise held on consignment from merchandise owned by the retailer, the Director may grant permission on condition that the merchandise owned by the retailer is physically separated from merchandise held on consignment in a manner satisfactory to the Director, and that sales and tax records of the merchandise held on consignment be kept separate from the sales and tax records of goods owned by the retailer, also in a manner satisfactory to the Director.
If the merchandise be so segregated and the records so kept separate, the tax on sales of items of merchandise owned by the retailer shall not be a lien on the merchandise held on consignment, but the tax on sales of items held on consignment shall be a lien on the merchandise so held and also a lien on the merchandise, furniture and fixtures, tools and equipment owned by the retailer.
If the retailer holds merchandise on consignment by different consignors the retailer may, with the approval of the Director, separate the different consignments for lien purposes and keep separate tax and sales tax records, and the only lien for sales tax on any consignment shall be the lien on sales of items out of the consignment.
A sale at retail out of a stock of merchandise in the regular course of business shall release the item or items sold from the sales tax lien hereby created, but newly acquired merchandise shall come and remain under the lien until sold at retail or until the tax is paid.
E. Status Of Unpaid Tax In Bankruptcy And Receivership: When the business or property of any taxpayer subject to this City Tax Code shall be placed in a receivership, bankruptcy, or assignment for the benefit of creditors, or seized under distraint for property or State taxes, all taxes, penalties, and interest imposed by this City Tax Code shall constitute a first, prior and preferred lien against all the property of the taxpayer, except as to preexisting claims or liens of a bona fide mortgagee, pledgee, judgment creditor, or consumer whose rights shall have attached prior to the filing of the notice as provided on the property of the taxpayer.
However, the goods, stock-in-trade, cash, deposits, accounts receivable, and business fixtures of the taxpayer shall not be subject to the above stated exception, and the taxes, penalties and interest shall be and remain a first, prior and preferred lien against the property of taxpayer.
No sheriff, receiver, assignee, or other officer shall sell the property of any person subject to this City Tax Code under process or order of any court, when that property is subject to a prior recorded City tax lien, except after notice of the sale date is given to the City. If there be any taxes due owing and unpaid, it shall be the duty of the officer to first pay the amount of the taxes out of the proceeds of the sale before making payment of any monies to any judgment creditor or any other claimants of whatsoever kind or nature except the costs of the proceedings and other preexisting claims or liens as provided above. (1968 Code §3-101; Ord. 76-168; Ord. 91-161; Ord. 01-42; Ord. 23-36)
