RICHMOND, Va. (WRIC) — Dozens of Richmond restaurant owners are demanding accountability, transparency and financial justice as the meals tax fiasco continues in the city.
During a meeting Wednesday hosted by the Virginia Restaurant Association (VRA), more than 30 restaurants came together with a simple message — they want their money back.
8News previously shared the stories of Philly Vegan and Richbrau Brewing, both of whom were billed tens of thousands of dollars after incorrectly being told by the city not to collect a 7.5% meals tax.
According to VRA director Mike Byrne, the city has unjustly collected a combined millions of dollars in penalties and interest after businesses were not properly notified of the tax issue. He said businesses were “at the mercy of a flawed and outdated finance department and tax system,” which resulted in major accounting errors.
“We’re talking about money, penalty, interest, transparency, communication, notice, ” Byrne said. “We want that penalty and interest back.”
VRA pointed to an April 2023 audit conducted by the city, which found that “incomplete information may be provided, additionally, business owners are not provided with balanced details, such as tax periods, tax types, penalties and interest amounts.”
Chief Administrative Officer Lincoln Saunders held a meeting with affected business owners hours after the VRA meeting. Saunders acknowledged that “there were things the City could have done better,” adding that leaders are now working with the attorney to provide the maximum amount of relief possible under the law.
Earlier this month, Saunders presented a multi-layered proposal that he believes would move Richmond forward in terms of tax revenue collection. The proposals included:
- Making electronic payments (RVA Pay) more accessible and removing the convenience fee
- Reducing the late payment penalty
- Extending the repayment plan period from 60 months to 72 months
- Lowering the minimum down payment thresholds
- Implementing “Business Cafes” to increase communication
- Preventing compounding late payments
Saunders said RVA Pay is in the works.
In the meantime, VRA is backing a bill authored by Sen. Bill DeSteph that would require localities to send proper notice of tax issues and refund businesses when there is a mistake.
This is a developing story. Stay with 8News for updates.
