Auto dealer sentenced for tax evasion

LOS ANGELES - The California State Board of Equalization (BOE) announced Wednesday that Jose Gregorio Hernandez was sentenced by Judge Charlaine Olmedo of Los Angeles County Superior Court to one year in county jail and five years formal probation for felony sales tax evasion.In addition, Hernandez was ordered to pay $362,711 in restitution to the BOE. Hernandez previously pled guilty to three felony counts of sales tax evasion and one felony count of grand theft on June 3, 2010. The case was prosecuted by the Los Angeles County District Attorney's Office, Major Fraud Division. Hernandez was sentenced Dec 20. Hernandez was the owner and operator of Pepe's Auto Sales, a used car dealership in the Arleta area of the City of Los Angeles. Hernandez failed to provide adequate records to a BOE auditor for examination during a sales tax audit, officials said. Further investigation by BOE indicated that a potential large understatement of sales tax was due. A BOE search warrant subsequently revealed that Hernandez had intentionally prepared and submitted fraudulent sales tax returns between 2003 and 2006. As a result, Hernandez failed to pay the State of California over $360,000 in sales taxes due. Tax evasion creates an unlawful competitive price advantage against legitimate taxpaying retailers selling used cars. Sales tax revenues fund various programs across the state, officials said. The five-member California State Board of Equalization is a publicly elected tax board. The BOE collects more than $48 billion annually in taxes and fees supporting state and local government services. It hears business tax appeals, acts as the appellate body for franchise and personal income tax appeals, and serves a significant role in the assessment and administration of property taxes. For more information on other taxes and fees in California , visit www.taxes.ca.gov.

********** Published: December 23, 2010 - Volume 9 - Issue 36