Is Failure To Pay A Tax Embezzlement

[Kathy63]

Well, he collected the taxes on behalf of the state. What would you call it? If he were an employee who collected monies on behalf of the employer and kept the money instead, would that be embezzlement?

This has nothing to do with paying taxes. It's turning over taxes already PAID and collected to the entity (the state) having actual ownership of that property.

[Ayatollahgondola]

He's not even remotely an employee of the state or municipal authority, so I don't see how that applies.

We

ll, he collected the taxes on behalf of the state

I don't know if that's true yet.
In many cases, the taxes are placed upon the company as opposed to the customer. This makes the company responsible even if the money is not collected. If this is the case, he collected the funds to pay the taxes levied upon his company. I don't see how this is embezzlement.

[Kathy63]

Maybe I can explain it to you.

I collect sales tax. I have a permit from the state that allows me to take temporary possession of state funds. By applying for that permit I agree to act as an agent of the state for the collection of such sales taxes. The funds at no time ever become "MINE". At all times the money collected as sales tax belongs to the state. I am not an employee of the state. I am an agent of the state for the collection of sales tax. This hotel owner took possession of state funds, that he collected on behalf of the state and kept it.

Sales taxes are never placed on the company rather than the customer. I think you may have this a bit confused with tip money and income tax. Because the amount of tips is so variable, waitpersons are charged a tip tax according to their receipts whether or not the tip is actually received.

[Ayatollahgondola]

Originally Posted by Kathy63

Maybe I can explain it to you.Sales taxes are never placed on the company rather than the customer. I think you may have this a bit confused with tip money and income tax. .

No that's not entirely true. the tax is levied upon the retailer by the state; not the customer

LEGISLATIVE COUNSEL'S DIGEST AB 1614,

as amended, Lempert. Sales and use tax: California Internet Tax Freedom Act.

The Sales and Use Tax Law imposes a tax on the gross receipts from the sale in this state of, or the storage, use, or other consumption in this state of, tangible personal property. That law imposes the sales tax upon "retailers," as defined, and requires every person desiring to engage in or conduct business as a "seller," as defined, to obtain a sales tax permit

Use taxes are levied upon the customer or end user.

[Kathy63]

Which means even if I do not charge a sales tax, I still have to pay it. Like stores that have sales saying they will pay the sales tax. If I COLLECT sales tax, I collect that tax on behalf of the state. It never becomes my money. That makes it embezzlement.

[Ayatollahgondola]

Originally Posted by Kathy63

Which means even if I do not charge a sales tax, I still have to pay it. Like stores that have sales saying they will pay the sales tax. If I COLLECT sales tax, I collect that tax on behalf of the state. It never becomes my money. That makes it embezzlement.

No. It's all your money until you pay what you owe as determined by the tax code. Otherwise you would be required to keep the funds separate from your own. Notice that there is no requirement to do so in the tax code? I'm soory, sales tax code. I don't know what the requirements are that this city placed upon this tax
I might add that California has never filed embezzlement charges against a retailer in relation to the sales tax code. And there's plenty of huge to small amounts that were never paid. Many, many, many.

[Kathy63]

Absolutely! Sometimes they get caught. Failure to pay sales tax is treated much more harshly than failure to pay income tax. In this case, failure to pay sales tax was treated as embezzlement. What does that tell you?