Auto Body Shop Owner Charged with Forging Reseller Permit

LYNNWOOD-- Sept. 27, 2010 - The owner of a Lynnwood auto body shop was charged today with altering another business’s reseller permit so he could buy parts without paying sales tax.

José R. Guevara, 30, was charged with a gross misdemeanor by the Financial Crimes Unit of the Attorney General’s Office at the request of the Washington State Department of Revenue. The charge carries a maximum penalty of one year in prison and a $5,000 fine.

Guevara operates J & R Auto Body in Lynnwood. According to the charging affidavit filed in Snohomish County District Court, Guevara admitted that he may have used the other business’s permit. Court papers also state that checks he wrote for the parts bounced.

This is the first prosecution of a business owner since the new reseller permits were introduced in January.

The permits, issued by the Department of Revenue, replaced the widely misused, self-issued resale certificates that cost state and local governments an estimated $100 million a year in lost sales taxes.

Misuse of the resale certificates occurred when businesses bought items tax-free for their own use rather than reselling them and collecting sales tax. Under the new system authorized by the Legislature, permits are issued only to qualifying businesses, and tighter controls are imposed.

“Sales tax is a vital source of income for state and local governments,” said Department Director Cindi Holmstrom. “We need to ensure that all businesses play by the rules and don’t enjoy a competitive advantage over others by avoiding taxes they should be paying.”

She noted that sellers can prevent others from bilking Washington citizens by using the Department’s online permit verification tool at http://www.dor.wa.gov/content/doingbusiness/registermybusiness/brd/.

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(360) 534-1602
KimS@dor.wa.gov

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