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More Local Restaurants Falling Behind on Meals Tax

by ARLnow.com February 24, 2011 at 2:31 pm 3,659 38 Comments

The past two months have apparently not been kind to a handful of local restaurants.

A number of restaurants have fallen farther behind on their payment of Arlington County meals taxes. Such tax delinquencies are sometimes a sign of shaky financial health, as was the case for failed restaurants like Bebo Trattoria, Restaurant Vero and McGinty’s Public House, all of which still owe tens of thousands of dollars to the county.

The latest delinquency list shows that Front Page Restaurant in Ballston (4201 Wilson Blvd) ran up an additional $23,000 tab with the county between December and February. The restaurant now owes Arlington $46,531.82. As of August, it only owed $17,113.52.

Kora Restaurant in Crystal City (2250 Crystal Drive) is also suffering. It owes $25,908.06 to the county, compared to $10,624.41 in December and $5,517.03 in August.

Tandoori Nights in Clarendon (2800 Clarendon Blvd) owes $19,404.69, compared $9,706.29 in December.

Cold Stone Creamery, in Ballston Common Mall (4238 Wilson Blvd), owes $13,959.15, compared to $8,633.35 in December.

Guarapo in Courthouse (2039 Wilson Blvd) owes $13,566.00. It was not listed in December’s delinquency list.

Champion Billards, near Shirlington (2620 S. Shirlington Road), owes $10,547.80, compared to $5,494.71 in December.

In a somewhat bright spot, former Bebo Trattoria owner Roberto Donna appears to be making his court-ordered repayments to the county. Bebo now owes $153,715.976, which is more than any other establishment but less than the $160,898.82 that the county said it owed in December.

Extra Virgin in Shirlington (4053 Campbell Ave) owes the most of any restaurant that’s currently in business. It owes $71,171.50 down slightly from December’s $72,352.56.

The 4 percent county meals tax is collected on all prepared foods and beverages sold in Arlington. Often, this tax is passed directly on to the consumers in the form of a tax charge on the bill.

Flickr pool photo by Chris Rief. No connection with any restaurant named here is implied.

  • LP

    Guarapo….no! Don’t go under!

  • SoArlRes

    I’m struggling to understand the failure here. If the meals tax of 4% gets passed directly on to the customer with the bill (at least it should), then why don’t these restaurants just have a seperate portion of their revenue account called “taxes (not profit)” into which meal taxes are placed for future payment to the county? Am I missing something? Is this more complicated than it seems? Honest question.

    • borf

      Exactly!

      Unless they are stupidly not passing it on as a separate charge.

    • ballston

      hence the comment about being delinquent most likely a sign of financial difficulty.

      when you are faced with being delinquent or being evicted from not paying rent or your supplier cutting you off, clearly you chose to go delinquent and “plan to make it up later”

      restaurants notoriously have cashflow problems, thats why so many sadly do not survive without a HUGE committment of capital from the owners.

    • NPGMBR

      I was wondering exaclty the same thing. I didn’t even know restaurants could hold onto those funds!

  • James

    I would assume they collect the tax from the consumers, and then spend it on their own past due accounts rather than hold on to it for later payment to the county. These places are mostly stuggling to stay afloat as it is, they owe money to suppliers and take it from whereever they have it and deal with the consequences later.

    • FedUp

      That’s what happens, I believe. In other words, they are supposed to hold the taxes in escrow and then turn the money over to the county. It’s not their money. If they don’t send it in, they are stealing from the taxpayers and the county. Thieves!

      • Burger

        I guess they could close up shop and then that would solve the problem. Of course, where does one go to somewhat crappy ice cream if it closes.

        Is the meal tax in addition to state sales tax?

    • kc

      Same thing happens with payroll withholding taxes all the time.

  • anon

    1.3 million dollars total.

    Also 3902 Wilson aka Pike Grill, aka Papi Pollo aka Tia Maria Restaurant owes $17,592.92 total.

  • Joe

    I wonder what would happen if a taxpayer owed this much? I am sure they would not be able to stay in their house like these business are able to keep their door open.

  • Southeast Ben

    If dining there…do you think I could get out of paying the tax since these establishments don’t see to provide the money back to the county?

    • FedUp

      I suggest paying the whole bill by check payable to “Arlington County Treasurer”. 😉

      • theBlackSquirrel

        Would you say the same to your neighbor who is behind on his credit card payments?

        • FedUp

          Huh?

  • BallstonDude

    Speaking of this…

    I went to Crumbs, once.

    The price was $3.75 for a cupcake. When I paid, I expected it to be that plus 9% but it came out to $3.75.

    What’s going on there?

  • SaveDaveMcKenna

    How is Bob and Edith’s II on this list? Haven’t they been closed for at least a year, maybe two?

    • Kate

      They still owe the money so it’s still there–Bebo is also out of business, and Bob and Edith’s has a rather healthy business going at the original (really, come on).

  • Ballstonian

    Forget the meals taxes. I want that CHIPWICH! Am I the only one that loves a good ice cream sandwich?

    • NPGMBR

      Yeah that does look good!

  • RJ

    I can’t loose frontpage…

    • Rick

      how do you feel about losing it though?

  • Shane

    So Front Page can’t pay the County taxes, but they can afford to put up a rink board advertisement in the rink at the Kettler Iceplex. They can’t pay the County taxes, but they can run various happy hour specials and whatnot. They can’t pay the taxes, but they can advertise all over the place.

    Seems to me Front Page needs to stop looking to Arlington to subsidize its failed business.

    • NPGMBR

      My guess is they are hosting Happy Hours because they bring in extra revenue during a time of the day that might otherwise be a little quiet. Same with advertising. If consumers don’t know you’re there you won’t get any NEW business. Of course the most important ingredient is to have good food.

  • John Andre

    This is bad if the restaurants add the meal tax to the customers’ bills, then fail to remit to the County.

    I worked at NRECA before retiring. Many of my co-workers who are still there go to the Front Page after work.

    Let’s hope the other Ballston bars are paying the County.

  • SoCo Resident

    Strange no one is blaming the inept County Treasurer here who is obiviously letting these restaurant “scum” get away with ripping us taxpayers off. If the money collected from customers is not immediately forwarded to County coffers, then it is THEFT! Why is the County Treasurer giving such special treatment here and allowing this debt to mount up over months? Try not paying your water bill, action will be taken!

    • CW

      If you don’t pay your tax bill, we’re going to shut off your taxes!!!

    • Jezebel

      Hey Mista WTF (West of Ft. Myer), i’m betting the Treasurer has a heart. Maybe recognizes short-term cash flow issues. Not wanting to kill the golden goose, so to speak. I imagine that as a percentage of total meals taxes, the delinquents are pretty small.

  • Arltwo

    I wonder how much of the amount due for each restaurant is the actual tax and have much is the penalty for being delinquent? Perhaps the late fees from the County are more than the original sum of tax due – a rollerball effect on the businesses.

  • Kate

    I was talking to a local bar/restaurant owner about this, and he said a. it would be pretty difficult for him to get away with it since the county folks dine there a lot and would give him a hard time, and b. yes businesses would do this so they can pay their suppliers.

  • Shell

    ok, but where is the picture from? I want that ice cream sandwich!!!

    • ShirleyUJest

      Think that’s a Dat’Oh from Bayou Bakery. Think LARGE Oreo like cookie sammich…only so much better.

  • tx2vadem

    “Often, this tax is passed directly on to the consumers in the form of a tax charge on the bill.”

    County code requires the seller to collect the tax from the purchaser. It must appear as a separate line item on the bill (section 65-5). According to the chapter on Meals Tax, it is class 3 misdemeanor to fail to comply with any section of the chapter.

  • Relax Preppy

    someone tell me where i can get that ice cream sandwich

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