Henrico County admits customers were overtaxed

Posted at 6:29 PM, Jul 14, 2014
and last updated 2014-07-15 11:20:52-04

HENRICO COUNTY, Va.  -- To tax or not to tax? That seems to be the question confusing some Henrico businesses. A four percent meal tax was implemented by Henrico County on June 1.

While the tax is pretty straightforward for restaurants, it gets a bit complicated for convenience stores and other locations.

For instance pizza at a convenience store deli is taxable, while ordering a cup of coffee is not.

CBS 6 investigated after being contacted by a Henrico man who said businesses were taxing customers when they shouldn't be. Ron Melancon has been tracking which area businesses are overtaxing and  even set up a Facebook page highlighting the discrepancies.

At Miller's in Glen Allen, Melancon said his cup of coffee is routinely taxed at over nine percent. He should just be taxed the 5.3-percent sales tax.

"It is amazing to me how many people are not reading receipts," Melancon added.

Workers at Miller's said off-camera that they are simply doing what their corporate offices told them to do and that they followed the direction the county gave them.

But an email obtained by CBS 6 showed the county already contacted the gas station and asked them to correct the amount of tax charged and provide refunds when necessary.

"I spoke with the accountant for Miller Mart on Friday. The problem should be corrected very soon if it has not been already," Steve Klos, a senior management specialist with Henrico, said. "Please let me know if there are any more issues going forward."

"It is just a few that are charging incorrectly," Gene Walter, Henrico County's Finance Director, said.

Walter added that if someone spots an issue, refunds are given by the individual company where the overtaxing was done.

Walter also asked residents to let the Finance Department know if there are any errors so they can address them with the individual business.

"Send us a copy of the receipt so we are aware of the overcharge so we can contact the business," Walter said.

For questions on what is taxable and what is not taxable in Henrico, click here. 

Henrico County anticipated that the four-percent meals tax would generate approximately $18 million in additional revenue, which will be dedicated to the operational and capital project needs of county schools.