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July 23, 2003

Daytona Area Spa Dealer Arrested in $21,000 Tax Theft Case

The owner of a Holly Hills spa dealership has been arrested on charges of refusing to pay more than $21,000 in sales tax that he collected from his customers but never sent in to the state, the state Department of Revenue announced

Joseph Kmaid, 42, of Holly Hills, was arrested Wednesday on a felony charge relating to tax theft by Corp. R. A. Klein of the Holly Hills Police Department. He was taken to the Volusia County Branch Jail for processing. If convicted, Kmaid faces up to 5 years in prison and up to $5,000 in fines, plus repayment of stolen tax, penalty and interest. Kmaid is the owner of JC & AP Spas and Accessories of 321 Second Street, Holly Hills.

According to Revenue Department investigators, Kmaid made a practice of collecting sales tax from customers at his spa dealership. During a period from May to September 2002, Kmaid collected $28,842 in sales tax, investigators charged. Under state law, sales tax becomes the property of the state at the moment of collection. However, Kmaid sent only about $7,451.33 in tax to the state and pocketed $21,391, investigators charged.

"Tax thieves steal from the public in several ways," said Jim Zingale, executive director of the Revenue Department. "First, they steal money that the public pays to support vital services, such as law enforcement and education. Second, they steal an unearned, undeserved competitive advantage over honest businesspeople who pay their taxes."

If you have information about tax theft, please call the Florida Department of Revenue investigations office in Tallahassee at Daytona Beach at 386-274-6622.