RICHMOND, Va. (WRIC) — A Richmond restaurant is demanding accountability after a meals tax mix-up has landed them with a nearly $40,000 bill.
In Richmond, food establishments are required to collect a 7.5% meals tax on customers’ bills, which is to be paid to the City by the 20th day of the month. This meals tax is a part of the City’s “Admissions, Lodging and Meal Taxes” (ALM) policy.
However, Philly Vegan co-owner Samuel Veney said they were told, upon opening in 2021, that they did not need to collect this tax — as a representative of the City’s finance department told them take-out only restaurants were exempt.
“She said, ‘Stop collecting meals tax. Do not collect this, because you’re take-out only,’ and she filled out our paperwork,” Veney said. “She did not check out the ALM box, and wrote ‘take-out only.’”
But nine months later, a tax auditor with the City visited the restaurant and told the owners that the previous directive was incorrect.
“They came back and said, ‘We made a huge mistake — you should actually be paying these meal taxes’,” Veney said. “On April 1st, we started collecting the tax and paying on time. The City acknowledged the mistake, but said ‘we still want you to pay.’”
The City admitted a staff member had given the restaurant incorrect information, according to documents obtained about the situation.
Despite this, Philly Vegan was sent a bill for $27,000 — which has now been increased to $37,277.33. Veney said the restaurant filed an appeal, but it was denied.
“Stressful, difficult, emotional,” said Veney, describing the toll this has taken. “We had to hire a lawyer — thousands of dollars. We’re taking that. The City has taken no responsibility for what they’re doing.”
The City of Richmond has been asked to provide a statement, but none has been provided at the time of reporting.
“We’re to the point now where we can’t just push this behind us. We been dealing with this for two years,” Veney said. “We want the City to start caring about the City as much as the people in the City care.”
