February 23, By Hannah Wulkan
After several issues with the Department of Taxation and Finance, a local restaurateur is hoping to change the policies for those in debt to the state.
The Dog House, a popular restaurant specializing in gourmet hot dogs at 37-06 30th Avenue in Astoria, has been shut down by the tax department twice in the last year, most recently on February 15 for owing $168,323.88. However owner Vlad Stern claims that the policies in place for those trying to pay back debt are ineffective, and even though he has worked to pay back his owed taxes, he has only fallen further in to debt.
“I want everyone to understand that we acknowledge our faults and mistakes, and at the end of day it is our fault, but there was no criminal activity and we never purposefully evaded our taxes, and aside from the closure we are very proud of the restaurant and the brand we have built,” Stern said.
Stern and his father opened the Dog House in 2013 as first-time restaurant owners, and had little expertise in running a business. Though they successfully launched the service side of the business, they hired an accountant to run their finances who “mismanaged” the money side of things, throwing the business in to debt, Stern said.
Stern began working with the Finance Department to pay back the owed taxes in March 2015, but said that despite consistently paying down his debt, the penalties and fines continued to add up, putting him deeper in to debt, Stern said.
He worked with the Department for several years, but the business was ultimately seized in October 2016. It was closed for about five weeks, and during that time the Finance Department held an auction to sell much of the equipment within the restaurant, such as tables and chairs and kitchen appliances, though they were listed for a fraction of their cost, Stern said.
While it was closed the seven restaurant employees were also out of work.
The restaurant finally reopened on November 23 and Stern said that they were able to recover their belongings, and since then he has hired a taxation attorney and has been paying his taxes well in advance.
“We started operating properly and paying advance taxes, which we should have done from the beginning and would have if we had known,” Stern said. “We are operating as we are supposed to now, but the bill keeps growing, accumulating penalties and interest daily, and the hole just keeps getting deeper.”
The restaurant was seized again this month, and Stern said that they are again working towards reopening, though they may not be able to due to the high penalties and fines.
Prior to being shut down, Stern said that the restaurant had begun to gain momentum. It had recently grown its menu to include unique burgers as well as hot dogs, and had increased its deliveries and had regular customers. “We were really looking forward to the summer season with our outdoor area and building on the momentum we had going,” Stern said.
Since being shut down for the second time, Stern has reached out to several local politicians about the issue to bring awareness to the taxation policies.
“I was thinking that maybe there’s a way to raise awareness and have the policies updated to make sense with the way things are now,” Stern said. “A lot of people shy away from following their dreams because know how challenging running a business can be, and maybe there’s a way that the system could be better for new business owners.”