Richmond Meals Tax Collection Changing
Due to multiple complaints from restaurants. The Richmond city council voted unanimously on Monday to change how meals tax is collected.
Problem
Restaurant owners have been paying tax bills for the previous balance first instead of the current month. This has resulted in late fees if the prior balances were not cleared.
The fees then rolled over and accrued month to month with no notice, resulting in exorbitant bills. For one restaurant, one late payment grew to a 68,000 balance.
Details
The current meals tax rate is 7.5% with a 10% penalty and another 10% penalty for each year unpaid. The new ordinance prevents the penalty from exceeding the total tax. The penalty has also changed from 10% to 2% of the total tax due or $10 whichever is greater. The ordinance comes into effect July 1, 2024.
For further details, see the link to the new ordinance below:
Conclusion
This ordinance provides due relief to the restaurant industry already hard hit by COVID-19. It is unfortunate, that this was not passed earlier, however, RVA Bookkeeping thanks Richmond City Council for hearing the call and making the necessary changes.
Are you a restaurant in need of bookkeeping? Check out our services. If interested, request a quote.
Are you satisfied with the Richmond City Council's response? Let me know in the comments below.