Comptroller blames city for paying contractors that owed taxes

New York City made payments to almost 200 contractors last year who owed thousands in taxes.

A new audit by City Comptroller Scott Stringer found the contractors owed a total of $5.7 million in unpaid taxes in 2017, the Wall Street Journal reported. Stringer blamed the Department of Finance for failing to collect the taxes. Most of the businesses had payment vouchers held under a restraint process, the report said — but the finance department didn’t go through the process of collecting the taxes.

One contractor, for example, owed the city $80,000 in back taxes but was paid more than $428,000 last year. The contractor has gone out of business so the city can’t collect the money, the report said.

The finance department said it would review the audited cases and agreed with many of the recommendations.

“Levying a taxpayer’s funds is a last resort, particularly because the vendors reviewed in this audit are small to mid-size businesses that could be adversely affected by seizing their payment too quickly,” Jeffrey Shear, the deputy commissioner of treasury and payment services for the finance department, said in a statement.

Last year, the city collected about $1.3 billion in business-tax revenue, the report said. [WSJ] — Meenal Vamburkar