News On Sales Taxes and Other Taxing Concerns

By Robert Wagner, CPA

Georgia Sales Tax Policy Changing for Restaurants

The hospitality industry is a major economic force in Georgia. It employs hundreds of thousands of people and pays millions in taxes of all kinds. The Georgia Department of Revenue plays a central role in the collection of sales and other taxes from restaurants.

Due to limitations in its new computer software program, the department is seeking to limit the number of Georgia restaurants that file sales tax returns for any date other than a month end. Many, perhaps most, restaurants in Georgia do not end their accounting periods on the last day of the month. Restaurants typically use 4 or 5-week accounting periods that end on the same day of the week each period. Generally a restaurant files sales tax returns and pays the tax 20 days after the end of an accounting period. In the past, the Department of Revenue has been very accommodating. Just ask for special dates to file sales tax returns and the department approves.

No long will the department automatically approve sales tax filing periods that are not the end of a month. The Department of Revenue complains that special treatment for restaurants creates too much work for their agents. The department argues that special filing dates should be limited or denied to taxpayers.

To have any chance to continue filing sales tax as you have in the past, restaurateurs must meet a new registration deadline just announced by the Department of Revenue. Beginning this year, the department requires all non-calendar sales tax filers request permission by November 1, 1998 to use sales tax filing dates other than month-end for 1999. Taxpayers missing this deadline will have no choice but to file their 1999 sales tax returns on a month-end basis. This is a major record-keeping hassle!

Even for restaurants filing a written request in time, the department promises to look closely at the taxpayer’s stated reason for requesting special dating. Implied is a threat to deny the request if the stated reason is found wanting. This is a bone-headed approach to tax collection. Taxpayers beware!

Robert Wagner is the managing member of Robert Wagner & Company, LLC, CPAs. The firm provides tax and accounting services to restaurants, bars and hotels. He can be reached at 404-874-7000, fax 404-874-1132, email: rwagner@bellsouth.net.