Sales Tax Fraud

I was reading an article about an undercover investigation done by a consumer reporter on Sales Tax Fraud. Then it occurred to me, I see this all the time; especially at small independent retailers and restaurants.

If you don't receive a register receipt (not the one from the debit/credit card machine), the business you are patronizing is likely "skimming" the proceeds and under reporting the amount they receive.

These proceeds (which are in addition to the cost of what you are buying) go right into their pockets.

This occurs when nothing is rung (entered) into the register and the cash is put in the drawer. Another sure fire sign of "Sales Tax Fraud" is the employee using a calculator to figure out the total.

Here is the story:

"It can happen every time you buy something, and it's costing our state a staggering amount of money.

KIRO 7 Consumer Investigator Wayne Havrelly went undercover to expose a problem that's hurting all of us.

There's a secret underground economy operating in our state, and you're the one paying for it.

If you bought something today with cash, there's a good chance the tax you paid didn't go where it's supposed to. The tax bandits made sure of that.

Registers ring millions of times a day in Washington state, but our consumer investigation has revealed the money and tax we pay isn't always recorded."

To read about the entire investigation:

Sales Tax Fraud Could Cost State Millions

This is a local story in Washington State. If Washington is losing millions to this, I wonder how much we are losing nationwide?

I keep reading how local governments are running out of money all over the country. This mean that (we), who are honest end up paying more for essential government services.

If you spot this you should report it to your local State authorities. In the long run, you could reduce your taxes and help your community get the money it deserves.

Trust me, these businesses are using the services I mention and they are doing it for free, plus a profit.

I tried to find information on how to report this sort of fraud in all fifty states and there are a lot of sites, but none that where you can do it nationwide. I would recommend doing a search for keyword "Department of Revenue" if you see somethng you would like to report.

Of course, my favorite resource for reporting tax scams is Quatloos. Here is a form they have to report scams:

Quatloos! Fraud Report Form

Consumer Investigator Wayne Havrelly inspired me to reflect on this AND I see it happening all the time.