When business owners don’t pay their sales tax or remit their withholding tax, the Missouri State Department of Revenue calls them out.
Once a week, DOR updates the Web site,
www.whoisnotpaying.mo.gov, a searchable database of businesses for which sales tax licenses have been revoked in the past year. Since January, 2,436 Missouri businesses owing a total $20.2 million in taxes made the list, said Ted Farnen, director of communications at DOR. Among those were 111 Springfield businesses that owed a total of $889,330, he added.
“We’re not doing this to harass business owners,” Farnen said. “It’s important that we enforce the state’s laws, because it’s not fair to the businesses that are abiding the law.”
Revoking a sales tax license is a last resort, Farnen said, adding that a business is usually in arrears for at least six months and multiple attempts via mail and telephone have been made to contact the owner.
Dan Emrie, who started Dan Emrie Photography in 1981, said his sales tax license was revoked over $7 because the payroll company he uses hadn’t filed the state withholding tax for the first and second quarters of 2010.
“It was just an oversight on their part,” he said, noting that now that he’s semiretired, there isn’t as much to report as there was in previous years. “I owed $7. That was it.”
Emrie said he wasn’t aware that his license was revoked until he was contacted for this story, though he acknowledged notices were probably sent.
“I get so many notices, it probably just went over my head that it was going on,” he said.
Once he learned about the situation, Emrie went to the local DOR office to settle up. The whole process, including reapplying for his sales tax license, took about an hour, he said.
“They were great about fixing it,” he added.
For a state sales tax license to be reinstated, a business must either pay what is owed in full or work out a payment plan with DOR, Farnen said, adding that an agreement would need to be signed and a bond provided.
And while businesses without sales tax licenses shouldn’t be operating, some do, he notes. Springfield businesses that made the list but appear to be in operation include American Inn, 3550 E. Evergreen St.; Conklin Guitars, 3672 W. FR 160; and Glass Unlimited, 1245 E. Republic Road. All three businesses were contacted for this story, but no calls were returned by press time.
If DOR receives a report of a business that is still operating with a revoked license, the department’s Criminal Investigation Bureau will send agents out to confirm, Farnen said.
“In some instances, a business will go under new ownership, and it will continue to operate under the same name, at the same address,” he said. “The new owner may have a sales tax license, but the old debt is still out there.”
Businesses found to be operating without a license are subject to a daily fine, beginning with $500 the first day and $100 each day after, with a cap of $10,000, Farnen said.
While there are no statistics that show compliance has increased because of the Who is Not Paying program, Farnen said it does act as an incentive to make sure sales and withholding taxes are paid.
“Frankly, no business would want to be on this list,” he said.[[In-content Ad]]