Gas station owners accused of tax evasion

August 19, 2010 3:26:19 PM PDT
Some Illinois gas station owners stand accused of failing to pay millions of dollars in sales tax.

The state has recovered more than $12 million in unpaid taxes, but there is more to be collected.

The investigation began years ago, with gas station owners noticing some of their competition with consistently low gas prices.

When the state took a closer look, they found what they say is station owners not paying their fair share.

Attorney General Lisa Madigan spoke about the charges.

On every gallon of gas, motorists pay sales tax. On $40 worth of gas, the tax is about $3.30 in Peoria and $3.90 in Chicago.

Investigators with the Illinois Department of Revenue found some gas station owners were not turning over all sales tax to the state.

"We intend to pursue every case that we've uncovered and make sure that Illinois businesses pay every penny of the sales tax they've collected from their customers," said John Chambers of the Illinois Department of Revenue."

On Thursday, the Illinois attorney general announced indictments against six gas station owners for tax evasion.

"People who fail to pay their taxes make our state a worse state to live, and we are not going to tolerate tax evaders in the state of Illinois," said Madigan.

One of those indicted was Joy Chemmachel, owner of a shell station at Pulaski and Fullerton. Attempts to reach Chemmachel were not successful.

The owner of the Mobil at Western and Irving Park was also indicted. Muzaffar Jameel said there was a problem with his accountant, and he will file amended taxes on Friday.

Some customers of the stations did not have much patience with business owners who may be holding back on paying taxes.

"It's just wrong not to pay them - everybody else does their part and pays 'em - they should pay them too," said Jasmine Rodriguez.

"Gas prices is high, and taxes on them are pretty much the same," said Troy Marshall. "Stealing a couple pennies - it's not good; it's not right."

"I don't get to put off paying my taxes, and I have a bunch of friends who are teachers who are being laid off because of the shortage of tax money," said Brian Peterlinz. "I think it's pretty lousy."

When investigators found the tax problem, the state first gave the station owners a chance to amend their taxes, which is how the state collected $12 million.

However, those who did not amend their taxes and pay up will be indicted.

The Illinois Petroleum Marketers Association represents 95 percent of the gas providers, and its executive vice president says he is glad to see action taken to make the business fair for the majority of law abiding providers.


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