It's getting increasingly difficult to hide from the tax man in New York State, thanks to improved automation, more efficient use of third-party data and tougher disclosure laws. Tax revenue obtained through "enforcement actions" has increased 40 percent during the past six months, bringing in an extra $185 million, and crushing some small businesses along the way. In fact, the Empire State is getting so good at shaking down taxpayers that one analyst tells the Times other states "envy" New York!
The improved enforcement methodology includes tactics like using sales data from liquor wholesalers to identify bars and restaurants that may be underreporting how many drinks they sell. Caught up in the crackdown are cash businesses like Manhattan strip club Ten's Cabaret, which is being pursued for $538,113 in unpaid taxes. Bouley Bakery was also forced to pay $367,522 in back taxes, and a Bowery convenience store went out of business after racking up almost a quarter of a million dollars in unpaid corporate taxes in recent years. (The location is now a high-end women’s boutique.)
But at least the state is also snaring big fish like the Walt Disney Corp., which paid $3.3 million in corporate taxes in July. (According to the Post, the No. 1 New York state tax deadbeat is a Queens man named Gui Hong Chen who owes $19 million in unpaid cigarette taxes.) And with a $3 billion budget gap looming, some lawmakers want even tougher enforcement. One bill being considered in Albany would give state agencies the right to deny renewals of professional licenses (everything from medical licenses to cosmetology licenses) to those who ignore tax warrants. The state is also considering a website to publicize the name of any tax delinquent who owes the state more than $5,000. Maybe they should get Fox 5's Arnold Diaz to throw delinquents into a "shame" spiral, too!
