After its bankers, the government attacks Guzzo. Revenu Québec is demanding more than $2.6 million from the cinema chain. The company has reportedly kept the money deducted from employees’ pay to pay their taxes in its coffers since April 2023.
Published at 1:38 a.m. Updated at 6:00 a.m.
On the phone, CEO Vincent Guzzo claims to have learned from The Press that Revenu Québec had registered mortgage appeals against his company and him. “We have had a payment agreement with them for six months. I haven’t received anything! » He adds that he also concluded such an agreement with the federal government.
Quebec’s action targets a large piece of land owned by the Guzzo group in Laval, at the corner of Highway 13 and Saint-Martin Boulevard. The taxman filed his legal hypothec on the property on Wednesday so as not to lose his rights to it. The day before, the City of Laval had filed its own appeal for unpaid property taxes.
In addition, Revenu Québec is also claiming $110,365 in taxes, penalties and interest from Vincent Guzzo personally, for the years 2020 and 2023.
Taxpayers’ money
In its appeal against Cinémas Guzzo, Revenu Québec is claiming its millions under the rules on “withholding taxes”: money deducted from pay to remit to the State. The employer must then transfer these funds to the government to pay its employees’ taxes and their contributions to public insurance funds.
The millions claimed likely include 15% penalties and interest, according to the experts consulted.
According to experts, governments are generally very unsympathetic towards companies that do not pay them the amounts deducted from salaries.
“There are two things you don’t mess with: taxes levied on your sales and withholding taxes,” says Pierre-Louis Réginald, professor of taxation at the University of Quebec in Montreal. You are a state agent, this money does not belong to you! »
For his colleague André Lareau at Laval University, Cinémas Guzzo therefore financed their activities with taxpayers’ money. “When we got there, it’s because things aren’t going very well,” he said. This means that he is no longer able to obtain financing. »
Withholding this money can also have serious consequences. If he does not reach an agreement with the State, the director of a company can be held “personally responsible” for the sums not remitted.
Big financial problems
The small Guzzo empire is already in court against its lessors and faces appeals from more than 60 million of its financiers. CIBC and private lenders consider him insolvent and threaten to bankrupt him.
In an interview at the beginning of the month, Vincent Guzzo assured The Press that the imminent financing of one of Quebec’s “among the richest” families would allow it to repay its creditors. Nearly three weeks later, he assures that negotiations are continuing on this subject.
In its appeal filed at the end of September against his group, CIBC accuses him of his “negligent management” and emphasizes that he has accumulated 1.4 million in unpaid property taxes.
The bank also mentions that a Guzzo account “was overdrawn daily for an extended period of time.”
At the beginning of October, the CEO considered the behavior of CIBC “really abusive”, of which he said he had been a customer for 22 years. According to him, CIBC’s debt includes nearly nine million in “COVID loans”, financing guaranteed by the government to help businesses get through the pandemic.
The Guzzo group also faces millions in lawsuits from the owners of several movie theaters it rents.
