RICHMOND, Va. – The City of Richmond announced it will freeze meal tax penalties and interest as it reviewed late payments from Richmond restaurants. CBS 6 has reported multiple instances where Richmond restaurants have accrued thousands of dollars in late fees without ever knowing fees and interest were growing.

In one recent example, ZZQ owner Alex Graf told CBS 6 that in 2020, she was late on one meals tax payment at a time when the city offered a COVID-19 meals tax amnesty program to restaurant owners. However, the Richmond Finance Department still accrued penalties and interest without ever notifying her.

“While the city strives to review all meals tax accounts, the cases that will take priority are those that are currently delinquent,” a City of Richmond spokesperson wrote in an email about the meals tax review. “The objective of the Department of Finance’s review is to ensure tax collections are being conducted accurately and in accordance with the applicable tax laws and regulations. Meals Tax accounts with existing delinquencies as of March 1, 2024, will receive notice by mail that their account is under review.”

The email indicated the city hoped to have the reviews done by July 1, 2024.

“If the Department is not able to complete an account review by July 1st, a new review timeline will be communicated directly to the business owner. So that no business receives additional costs due to this review period, penalties and interest will be frozen for cases under review,” the email continued. “However, businesses must continue to collect and remit their monthly meals tax payments per state and city law. The city cannot commit to waive penalty and interest on future late payments.”

The City of Richmond established a Meals Tax Inquiry Form where business owners can ask questions of the Department of Finance. They can also email questions to [email protected]. Email should include personal identifiable information, the city advised.

Depend on CBS 6 News and WTVR.com for in-depth coverage of this important local story. Anyone with more information can email [email protected] to send a tip.