Are the monthly volume and price reports that Delaware alcohol importers file with the Division of Revenue accessible under FOIA, or are they confidential tax records?

Official title

18-IB43 9/6/2018 FOIA Opinion Letter to Ms. Melony Anderson re: FOIA Complaint Concerning the Division of Revenue

Plain-English summary

A law firm asked the Delaware Division of Revenue (DOR) for monthly Rule 401 reports filed by World Class Wholesale, LLC, covering February 2014 through January 2017. Rule 401 of the Alcoholic Beverage Control Commission regulations required importers to file monthly reports including beverage volume and pricing. DOR denied the request, calling the reports tax records. The firm pushed back, arguing the reports were filed under ABCC regulations, not tax law, and contained no tax information.

The AG sided with DOR. Even though the reporting requirement appeared in ABCC rules, those rules sit inside Section 400 ("Taxation") of the regulations, and DOR uses the monthly figures to compute taxes owed by alcohol importers under Title 30. Under 30 Del. C. § 368, anything disclosed in a report required under Title 30 is confidential, and 29 Del. C. § 10002(l)(6) carves out from "public record" any document specifically exempted by statute. Result: the reports were properly withheld.

Currency note

This opinion was issued in 2018. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

What did the requester want?

Monthly Rule 401 reports filed by a specific wholesaler covering nearly three years of activity. After the initial denial, they narrowed the request to just the volume sold and the price, hoping to get past the tax-record objection. DOR denied that too.

Why did the AG treat these as tax records?

The AG gave several reasons drawn from the regulation and DOR's function:

1. The monthly reports are delineated in Section 400, "Taxation," of the ABCC regulations.
2. Rule 401 is titled "A Rule Governing Taxes Paid on Wine, Cider, Spirits, and Beer Entering the State of Delaware," which signals a tax purpose on its face.
3. DOR is responsible for the assessment and collection of taxes for alcoholic beverage importers, and it uses the monthly reports to verify and compute the applicable taxes based on volume.

On that basis, the AG found the records "constitute reports required under Title 30."

What does 30 Del. C. § 368 actually say?

The opinion quotes the statute as making it unlawful to disclose "the amount of income or any particulars set forth or disclosed in any report or return required under this Title." Read together with § 10002(l)(6), which excludes statutorily exempt records from "public record," the AG concluded DOR was statutorily prohibited from producing the reports.

Did narrowing the request to volume and price help?

No. The requester clarified that it sought only the amount of alcohol sold and the price, but DOR denied that too, and the AG found the reports exempt as Title 30 reports. The AG treated the records as reports required under Title 30 and did not parse the request field by field.

Background and statutory framework

Delaware FOIA makes public records reasonably available to citizens for inspection and copying unless a statutory exemption applies. Under § 10002(l)(6), records exempted from public disclosure by statute or common law are not "public records." The Title 30 tax-confidentiality statute at 30 Del. C. § 368 is one such exemption: it makes it unlawful to disclose the amount of income or any particulars set forth in any report or return required under Title 30. The interaction creates a clean rule: if the document is a Title 30 report or return, FOIA does not reach it.

The ABCC's Rule 401 requires importers to file monthly reports including beverage volume and other information, and DOR uses those reports to verify and compute the alcohol importer taxes it must assess and collect under Title 30. Because of both the regulation's tax framing and DOR's actual use of the reports in computing taxes, the AG found they are reports required under Title 30 and therefore exempt.

Citations

• 29 Del. C. § 10002(l)(6) (statutory-exemption carve-out)
• 29 Del. C. § 10005 (Petition procedure)
• 29 Del. C. §§ 10001-10007 (Delaware FOIA generally)
• 30 Del. C. § 368 (tax record confidentiality)

Source

• Landing page: https://attorneygeneral.delaware.gov/2018/09/06/18-ib43-9-6-2018-foia-opinion-letter-ms-melony-anderson-re-foia-complaint-concerning-division-revenue/
• Original PDF: https://attorneygeneral.delaware.gov/wp-content/uploads/sites/50/2018/09/Attorney-General-Opinion-No.-18-IB43.pdf

Original opinion text

PRINT VERSION: Attorney General Opinion No. 18-IB43

OFFICE OF THE ATTORNEY GENERAL OF THE STATE OF DELAWARE

Attorney General Opinion No. 18-IB43

September 6, 2018

VIA EMAIL

Melony Anderson, Esq.

Balick & Balick, LLC

711 King Street

Wilmington, Delaware 19801

[email protected]

RE: FOIA Petition Regarding the Delaware Division of Revenue

Dear Ms. Anderson:

We write regarding your correspondence alleging that the Delaware Division of Revenue ("DOR") violated the Delaware Freedom of Information Act, 29 Del. C. §§ 10001-10007 ("FOIA") with respect to your records request. We treat your correspondence as a petition for a determination pursuant to 29 Del. C. §10005 regarding whether a violation of FOIA has occurred or is about to occur ("Petition"). Because we have determined that DOR is statutorily prohibited from producing the records you requested, we find that DOR did not violate FOIA as alleged.

BACKGROUND

On June 18, 2018, your firm submitted a request to DOR for "all monthly reports pursuant to the Delaware Alcoholic Beverage Control Commission Rule 401 filed by World Class Wholesale, LLC covering the period of February 2014 to and including January 2017." DOR denied the request and stated its position that the documents were tax-related and therefore exempt from the definition of "public record" by Title 30, Chapter 5 of the Delaware Code. In response to the denial, your firm submitted a second request clarifying that you only wished to receive "the amount of alcohol reported sold, and the price it was sold at by the month… in order to determine a two year volume." This request was again denied since "the requested reports and their details are exempt as a tax record under Title 30."

You filed a Petition with this Office challenging the denial, asserting that the monthly reports are required by the Delaware Office of the Alcoholic Beverage Control Commission ("ABCC") administrative regulations and "there is nothing in these reports that refers to taxes or income." By letter dated August 24, 2018, DOR submitted a letter ("Response") explaining its denial under 29 Del. C. § 10002(l)(6), which exempts any records that are "specifically exempted from public disclosure by statute or common law." In accordance with 30 Del. C. § 368, DOR argued it is prohibited from disclosing any reports required by Title 30 or any information contained in these reports. DOR stated that it is tasked with the assessment and collection of taxes for licensed alcoholic beverage importers, and even though the reports are required by the ABCC regulations, they are still tax reports, which are necessary for DOR to "verify and compute taxes for the particular importer or wholesaler."

DISCUSSION

"Public records" must be made reasonably available to citizens for inspection and copying unless a statutory exemption applies. Under 29 Del. C. § 10002(l)(6), records exempted from public disclosure by statute or common law are not "public records." In this instance, 30 Del. C. § 368 states that it is unlawful to disclose the "amount of income or any particulars set forth or disclosed in any report or return required under this Title." DOR is responsible for the "assessment, collection, review and appeal of deficiencies of tax" and any "claims for refund of overpayment of taxes" for alcoholic beverage importers. The monthly reports you have requested are delineated in Section 400, "Taxation" of the ABCC regulations. Pursuant to Rule 401 entitled "A Rule Governing Taxes Paid on Wine, Cider, Spirits, and Beer Entering the State of Delaware," importers submit monthly reports including beverage volume and other information, and DOR uses these monthly reports to verify and compute the applicable taxes based on volume. Simply stated, DOR requires these tax reports to compute alcohol importer taxes which must be assessed and collected under Title 30. Therefore, based on the language of the ABCC regulation itself and actual function as a necessary element of the State's tax calculation methodology, we find that these requested records constitute reports required under Title 30. Accordingly, we have determined that DOR appropriately withheld the records pursuant to 29 Del. C. § 10002(l)(6) and 30 Del. C. § 368.

CONCLUSION

For the reasons set forth above, we determine that DOR has not violated FOIA as alleged.

Very truly yours,

/s/ Aaron R. Goldstein

Aaron R. Goldstein

Chief Deputy Attorney General

cc:

Angeline M. Kogut, Deputy Attorney General

Dorey L. Cole, Deputy Attorney General