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New York State Commissioner of Taxation and Finance Robert L. Megna today announced that a major Manhattan grocery group pled guilty on January 22, 2008 to a felony tax charge of filing fraudulent returns and will pay $375,838 in collected sales tax that was never paid to the state between December 1999 and November 2005.
TEM Food Corp., located at 42 Avenue C, Manhattan, NY, and seven other related grocery markets operating under the Fine Fare Foods umbrella group, were the subject of an investigation by Manhattan DA Robert Morgenthau's office. A comparison of bank deposits and sales tax returns showed major discrepancies and it was determined that six of the eight corporations being looked at underreported their gross receipts by an aggregate $37.1 million, of which 13% represented transactions in which sales tax was collected and not paid.
In addition to paying the outstanding sales tax liability of nearly $376,000, TEM Food Corp and seven associated supermarkets will pay more than $500,000 in interest and penalties. TEM Food Corp will also pay a $10,000 criminal fine.
Commissioner Megna said, "Sales tax is a trust tax, paid in good faith by the consumer with the understanding that the retailer will promptly pay it to the state to support vital public programs. It is not a means to pad profits, or to gain a competitive advantage over the competition."
The Department extends its thanks to Manhattan District Attorney Robert Morgenthau for his aggressive enforcement and prosecution of tax crimes.
TEM Food Corp. and the associated markets also pled guilty to a misdemeanor violation for Failure to File New York City General Incorporated Tax returns.
Additional information may be found in the Manhattan DA's press release found at :
http://manhattanda.org/whatsnew/press/2008-01-22.shtml
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Last Modified: January 28, 2008
