AG: Saegertown restaurant owner fails to turn over tax revenue
Oct. 25—The Pennsylvania Office of Attorney General has charged a Saegertown restaurant owner with failing to turn over to the state more than $30,000 in state sales taxes she collected.
Rose A. Powell, 58, of Saegertown, is accused by the office of collecting $32,618.73 in Pennsylvania's 6 percent sales tax from customers at her restaurant, the Pizza Villa in Saegertown, but not paying it to the state.
The office alleges the money was collected between Feb. 1, 2018, and Aug. 22 of this year.
In interviews with investigators in January 2020 and May 2022, Powell stated she is responsible to file and pay the tax for the restaurant to Pennsylvania, according to the affidavit of probable cause filed with the criminal complaint.
Powell admitted to investigators she comingled collected sales tax with her sales revenue in one bank account and uses the money to pay other expenses at the business instead of turning the tax money over to the state, the affidavit said.
"She confessed that taxes are at the bottom of the list of things she must pay, so the money would run out by the time sales tax was due each month," the affidavit said.
The affidavit said Powell failed to file required tax returns and after making promises to do so at both interviews.
The affidavit said a state Revenue Enforcement Collections agent was assigned to get the restaurant in compliance beginning in August 2017. An agent met with Powell several times, explaining tax filing and payment requirements for the business as well as updating Powell on non-filed returns and business taxes owed, the affidavit said. The agent even attempted to get her on a deferred payment plan with the Department of Revenue.
After giving Powell multiple opportunities to come into compliance to no avail, the matter was referred to criminal investigation for further enforcement in February 2018, the affidavit said.
An average monthly sales tax due was calculated for the 33 non-filed periods covered by the investigation to estimate the tax charged and collected, the affidavit said.
Records show the sales tax license for the business was revoked on April 14, 2009, due to unpaid taxes and she was notified by mail.
On Aug. 23, 2017, Powell was served with a second notice of the revocation by the Revenue Enforcement Collections agent. However, Powell "failed to obey the order to cease doing business until the license has been restored to a compliant status."
Powell continues to collect the sales tax, but was spending the tax money on other business expenses to keep the eatery open.
Powell was arraigned Monday before Magisterial District Judge Lincoln Zilhaver on one third-degree felony count of theft by failure to make required disposition of funds received and an ungraded misdemeanor count of failing to remit sales tax or file a return.
Powell remains free on her own recognizance. She faces a preliminary hearing on the charges Nov. 7.
Keith Gushard can be reached at (814) 724-6370 or by email at kgushard@meadvilletribune.com.
