Use tax to be subject of hearing

Friday, January 12, 2007

The Barry County Commission is seeking public input on a proposed special use tax that could generate $200,000 a year in additional revenue for county services and road improvements.

On Thursday, Jan. 18 at 10 a.m., county commissioners will host a hearing to discuss the use tax, which would have to be approved by county voters before it could be enacted.

Presiding Commissioner Cherry Warren said rising costs and demands for more services have prompted the Commission to begin considering ways to increase county revenues. Warren, along with Southern Commissioner Eddie Davison and Northern Commissioner Frank Washburn, said the Commission is committed to seeking a revenue-generating plan that will result in the least adverse financial impact on Barry County residents as possible.

"Large increases in healthcare costs, liability insurance, fuel for patrol cars, heating, along with reduced reimbursements, have compelled the Commission to take a look at how it could increase revenues to meet its obligations without increasing regular sales tax to Barry County citizens," said Warren.

"The fiscal use tax is a method by which a local government acquires additional revenue in a way that has very little impact on the average consumer," added Warren.

The tax is collected on purchases totalling more than $2 million a year from out-of-state vendors. This tax is assessed on catalog purchases or against those who travel out of state to make purchases and have them shipped back to avoid paying sales tax.

"The average consumer ordering from a catalog company will pay relatively little, if any, use tax," said Warren.

The use tax has been approved by Lawrence and Stone county residents, and commissioners in those two neighboring counties, have reported their residents are affected very little by the use tax.

"A true sales tax has an immediate and direct effect on consumers and taxpayers, while a use tax has a lot less impact," said Davison.

Another attribute of the local use tax is the fact that it helps support local business.

"Local use tax also levels the playing field between Barry County merchants who must apply sales tax and out-of-state vendors who sell goods tax free," said Washburn.

Barry County does not impose a tax levy on real estate or personal property. County government operates on a half-cent sales tax for general revenue and fees collected by various county offices. County road districts are dependent on a half-cent capital improvement sales tax for roads.

If the local use tax were approved by voters, it could generate about $200,000 a year. This amount would be equally divided between the county's general revenue fund and the county's 25 special road districts and one common road district.

"This would not only help reduce the effect of increasing costs, but it could also help chip and seal a few more miles of county roads and the increased revenue should help the sheriff's department cut down the response time for our county's residents," said Warren.

Anyone with questions about the local use tax is urged to attend the Jan. 18 public hearing.

Commissioners have until Jan. 23 to decide whether or not they will place the tax issue on the April ballot.

"We've spent quite a bit of time researching the use tax," said Warren. "Now we want to the know what Barry County citizens think of it."

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