A local business owner has been placed on probation for two years and will be required to pay back $74,411 for failing to pay sales tax to the state.
The business owner, Mitesh Khokhani of M&M Sparta Smoke LLC in McMinnville, entered a guilty plea before Circuit Court Judge Bart Stanley to tax evasion charges. He was given a two-year probationary sentence and must pay back the money he failed to submit to the state of Tennessee as part of his sales tax collections from his business.
The Special Investigations Section of the Tennessee Department of Revenue conducted the investigation that led to his guilty plea for sales tax evasion. Last October, the Warren County grand jury indicted Khokhani on 21 felony counts of sales tax evasion and one felony count of theft of property over $10,000. The indictments charged that from April 2010 through December 2011, Khokhani failed to remit $74,411.73 in sales tax collected from customers of M&M Sparta Smoke.
“This investigation will serve as a reminder that retailers are not entitled to use or keep sales tax monies,” Revenue Commissioner Richard Roberts said. “When sales tax revenues are collected by a retailer, they are at all times property of the state or local government and must be remitted to the state.”
The department pursued this criminal case in cooperation with District Attorney Lisa Zavogiannis and her staff. Citizens who suspect violations of Tennessee’s revenue laws should call the toll-free tax fraud hotline at (800) 372-8389.
The Department of Revenue collects about 87 percent of total state revenue. During the 2014 fiscal year, it collected $11.8 billion in state taxes and fees and more than $2.3 billion in taxes and fees for local governments.