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State tax officials have put more than 1,200 businesses across the state on notice this week that they are out of business unless they pay their overdue sales taxes immediately.
For most, that action came in the form of a personal visit from the state Division of Taxation, ordering business owners to lock their doors at once.
By Wednesday, a line of people had queued up inside the Department of Administration building on Smith Hill, waiting their turn to plead their case to a state revenue agent. Some were angry. Others frustrated.
“I understand the state needs money, but to put pressure on the small guy or the moderate guy that’s struggling, it’s not going to do any good,” said Mike Suriani, who owns an electrical supply company in South Providence.
In Suriani’s case, it may have been a bookkeeping error that landed him in the three-hour line. Suriani says he paid his taxes in full — albeit a little late –– and had copies of the cancelled checks from the state showing he had indeed turned over the sales taxes he collected.
But that didn’t keep taxation officials from appearing at his door Tuesday demanding that he close up shop.
“Yes, the rules state that we have a responsibility to pay our bills every quarter. But when your customers come in and they don’t pay you for a month, and then another month, and another month, businesses have no choice [in] the eyes of the state but to close up and get out,” Suriani said.
State officials say they’ve given businesses with sales-tax permits plenty of notice that they’ve fallen behind in making tax payments.
The permits expired on June 30, and the last in a series of letters sent to owners in recent months said they would not be issued new permits without straightening out their tax situation. In the interim, they were told: “You are conducting business without a permit and must cease immediately.”
A handful in line Wednesday said the process wasn’t quite that simple. Desmond Clark, who owns a small video-game store in North Providence, said he spent months trying to negotiate a payment plan with the state that would allow him to keep current on owed taxes, while staying afloat in a tough economy.
“They didn’t want to hear it. They didn’t want any payment plan whatsoever,” said Clark.