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A dump truck operator and an auto parts store were the biggest tax delinquents whose permits to collect sales tax were revoked in this year's second and third quarters. These businesses and others collected sales tax from customers but didn't pass it along to the Minnesota Department of Revenue.
The department says that when a business is delinquent either by failing to pay or to file a return, tax collectors try to work out a payment plan with the business. If the effort fails, the business eventually will lose its sales tax permit. If the business is still operating, revocation legally shuts it down because it is no longer allowed to sell taxable products.
The owner may also be guilty of a gross misdemeanor or felony for intentional tax evasion or for continuing to operate after revocation.
To get a new permit after one has been revoked, the owner must pay the back taxes and provide a security deposit or bond that can be used against future delinquency. The deposit must cover two filing periods' worth of payments, up to $10,000.
I used the permit revocation list on the Department of Revenue's website to compile a list of the 10 businesses there were added from April 1 to Sept. 30 and owed the most in sales taxes, penalties and interest at the time of revocation. The only way a business can get off the list is by paying the full debt.
The business currently holding title to the longest membership on the list is Vendstar Inc., a St. Paul company that did business as Best Vending Services. It owed $125,094 at time of revocation on Dec. 13, 2006.
1 Charles J. Poirier, doing business as Wee Haul, Big Lake, owed $334,671 at revocation June 18.
2 Gregory A. McArthur, doing business as Auto Trends, Elk River, owed $259,513 at revocation Aug. 5.
3 Roxana Chastain, Minneapolis, owed $164,255 at revocation Sept. 16.
4 The Bears Den Bar & Grill, Elysian, owed $148,920 at revocation Aug. 26.
5 Gina Carlson, doing business as 4 Seasons Cleaning Services, Spicer, owed $112,849 at revocation June 24.
6 Meilmann Investments Inc., doing business as Corner Kick, Maplewood, owed $104,199 at revocation April 16.
7 Bed & Bone Inc., a pet boarding facility, Buffalo, owed $102,357 at revocation May 20.
8 Temple Restaurant & Bar Inc. Minneapolis, owed $75,994 at revocation Sept. 9. The permit of Thanh Do II Inc., another restaurant owned by Temple's owner Thom Pham, was also revoked Sept. 9. Thanh Do II Inc. was located in Anoka and owed $6,479 at revocation.
9 Joni M. Brockway, doing business as Snappy Signs, St. Paul, owed $62,799 at revocation Aug. 19.
10 Restaurant Technical Fire & Safety, Hastings, owed $60,329 at revocation April 23.
Programs funded by sales tax
Minnesota's general sales tax rate is 6.875 percent. A portion of that, 0.375 percent, is set aside for environmental and arts programs. The remainder, 6.5 percent goes to the state's general fund.
Counties and cities can also levy sales tax. As an example, most businesses in Minneapolis collect 7.775 percent in sales tax, which is higher than the state figure because it includes a metro area 0.25 percent tax for transit improvement projects, Hennepin County's 0.15 percent tax for the Minnesota Twins' Target Field and the city's 0.5 percent tax for the Minneapolis Convention Center and other projects. Additional taxes apply to many downtown Minneapolis businesses.
Each week, Hard Data digs into public records and puts a spotlight on rule breakers in the Twin Cities and Minnesota. You can contact me at email@example.com.