City of OKC says select stores owe $1.4M in uncollected grocery sales tax

OKLAHOMA CITY (KFOR) — City Budget Director Christian York said good news from this fiscal year was the state's grocery tax being eliminated, with local sales taxes still being applied.

However, York says the bad news is that some retailers haven't been applying the local sales tax. Those select stores combined will need to pay up to reimburse what the city has lost.

The grocery tax bill eliminated the state's portion of the taxes earlier this year. The cut did not include the local portion of taxes.

"We've seen about five sales tax checks and all of them have missed target at this point," said York. "It was bad news during an already bad season."

York said the Oklahoma Tax Commission speculates select retailers owing $1.4 million dollars.

"They are aware of the issues, and I know that the retailers are working on getting that changed over," said York.

News 4 went to an Uptown Grocery location, and their store manager said the company never took away the local sales tax, so they will not be contributing to the pricey payment.

Bob Blevins is a local shopper at Uptown Grocery. He said he would've been alarmed if his grocery bill didn't have taxes.

"I'm surprised an educated shopper didn't bring that to their attention. I would have because I know that the law didn't include the repeal of all taxes," said Blevins.

York said it was a heavy lift for some stores. He said retailers had to make adjustments starting at the the line item level for each of the items in their systems.

Despite the shortfall, Blevins said he shops at least 10 times per month and sees a difference.

"The grocery bill is lower than it has been in the past. It's not an enormous amount lower, but it's noticeable," said Blevins.

York said OKC is dependent on sales and uses local taxes to fund operations.

"Things like road repair, police service, fire services are important to you. We ask you to consider where you're shopping and try to do that within Oklahoma City," said York.

News 4 reached out to the Oklahoma Tax Commission for a list of the stores who owe the city money. We were told that information is considered confidential taxpayer information.

The Oklahoma Tax Commission sent a statement saying:

The Oklahoma Tax Commission does not currently have an estimate of underreported local sales tax on grocery items. When notified of businesses not fully applying the local sales tax on food items, the Commission acts promptly to provide assistance in making the necessary corrections.

However, information regarding specific businesses that may be out of compliance following the recent elimination of the state sales tax on food is considered confidential taxpayer information. The Tax Commission remains committed to ensuring businesses remit the correct amount of sales tax and will continue efforts to uphold compliance across the state.

Oklahoma Tax Commission

York says they hope to have the funds back within the next few months, in an effort to get the city's budget back on track.