The state Department of Revenue has put a lien on a Leflore County Civic Center bank account because of an alleged failure to pay sales taxes.
But the Civic Center’s director says that some of what the state claims it owes came from events sponsored by tax-exempt organizations and that in other circumstances show promoters left without paying their tax bills, leaving the Civic Center holding the bag.
The Leflore County Board of Supervisors, which owns the Civic Center, unanimously voted Monday to appeal the lien.
The Department of Revenue will hear the appeal and decide if it merits going to an independent review board.
The state discovered the missing sales taxes during a random audit of the Civic Center’s books from April 2008 to April 2011.
It gave the Civic Center a chance to respond, and Director Andrew McQueen said they did so and thought everything was settled.
But then the state placed a $14,182 lien on the Civic Center’s entertainment account.
In some cases, the Civic Center didn’t charge sales tax on items it rented for events, such as tables and chairs.
But about $3,600 of the total lien came from the twice-yearly Mississippi Blues Show. The concerts are sponsored by a nonprofit group, which wouldn’t be required to pay sales taxes on rentals. McQueen and the Civic Center’s tax accountant said they believed they can document that the taxes weren’t required to be paid.
Also, some shows didn’t pay sales taxes on tickets sold at the Civic Center box office. Some promoters said they had tax ID numbers and would pay the sales taxes themselves rather than having the Civic Center collect them, McQueen said. But then the promoters didn’t pay, and the Department of Revenue wants to make the Civic Center pay the bill, McQueen said.
County Administrator Sam Abraham questioned whether there would be enough evidence to knock a substantial amount off what the county owes. He said he’d already negotiated the Department of Revenue down from $14,182 to $12,350 and it might be difficult for the Civic Center to produce documentation proving what it says is true.
He said that the Civic Center has made changes to ensure the problems won’t happen again.
• Contact Charlie Smith at 581-7235 or csmith@gwcommonwealth.com.
