Memphis Business Owner Sentenced For Violations of Tennessee’s Revenue Laws
WILLIAM MCGARRITY PLEADS GUILTY TO SALES TAX EVASION AND THEFT CHARGES
NASHVILLE, Tenn. - William McGarrity, 6915 Goodman Rd., Walls, Miss., pled guilty to one Class E Felony count of sales tax evasion, a violation of Tenn. Code Ann. Section 67-1-1440(d), and one Class C Felony count of theft of property over $10,000, a violation of Tenn. Code Ann. Section 39-14-103. The Special Investigations Section of the Tennessee Department of Revenue conducted the investigation that led to the Dec. 1, 2006, conviction of McGarrity, age 66. McGarrity is the former owner of two bars — Red Wagon and Cheyanne Country, located at 5275 South Third St. and 1976 East Shelby Dr. in Memphis, Tenn. The investigation for Cheyanne Country covered a 46-month period from Dec. 1, 1999, through Sept. 30, 2003. The investigation for Red Wagon covered a 63-month period from April 1, 1998, through Sept. 30, 2003, with the exception of August 2001.
“When sales tax is collected from the public and not remitted, it is a breach of the public trust,” said Commissioner Loren L. Chumley. “The Department of Revenue aggressively pursues criminal sanctions and demands accountability for such actions.”
On Dec. 1, 2006, Judge W. Mark Ward in Division 9 of the Shelby County Criminal Court sentenced McGarrity to five years in prison, suspended in lieu of five years probation, a $500 fine and court costs for the theft of property charge. Ward also sentenced him to one year in prison, suspended in lieu of one year probation, and full restitution of the $41,292 of sales tax McGarrity collected and failed to remit to Tennessee. McGarrity also will be required to pay additional civil penalties and interest due the state. The case was prosecuted by the Fraud and Economic Crime Unit of Shelby County District Attorney Bill Gibbons’ office.
Citizens who suspect violations of the Tennessee revenue laws should call the toll-free tax fraud hot line at (800) FRAUDTX (372-8389).
The Department of Revenue is responsible for the administration of state tax laws and motor vehicle title and registration laws established by the legislature and the collection of taxes and fees associated with those laws. The Department of Revenue collects approximately 92 percent of total state tax revenue. During the 2005-2006 fiscal year, the department collected $10.3 billion in state taxes and fees. In addition to collecting state taxes, $1.8 billion of local sales tax was collected by the department for local governments during the 2005-2006 fiscal year. Besides collecting taxes, the department enforces the revenue laws fairly and impartially in an effort to encourage voluntary taxpayer compliance. The department also apportions revenue collections for distribution to the various state funds and local units of government. To learn more about the department, log on to www.Tennessee.gov/revenue.