Cape city council to consider sales tax holiday

A back-to-school sales tax holiday returning to Cape Girardeau this August looks likely as Mayor Harry Rediger and several members of the city council vocally have supported its reinstatement.

The city stopped participating in the annual sales tax holiday in 2009 when sales tax receipts declined and were projected to stay that way. With revenue continuing to rebound and money flowing into the city for capital improvements with the operation of Isle Casino Cape Girardeau, the council is taking another look at the holiday.

Since 2003, state sales tax annually was waived on purchases of back-to-school items such as clothing, computers and school supplies during the first weekend in August. The county also participates in the holiday by waiving a 1 percent sales tax. If the council passes all readings of an ordinance that would rescind a 2009 ordinance to opt out of the holiday, the city's 2.75 percent sales tax also would come off purchases this year. The first reading is set for the council's regular meeting Monday.

On Friday, Rediger said he intends to fully support reinstatement of the sales tax holiday. Three other members of the seven-member council also voiced support of the reinstatement during its last regular meeting.

"I really think at this juncture, with our receipts increasing and our budget under control, and we do have casino funds coming in for capital projects and some extra projects these last eight months, that this is one thing we've kind of left on the table these last few years," Rediger said. "It would be a plus for our citizens and visitors to be able to take advantage of that weekend to do some extra shopping and save a little sales tax money."

Rediger said he wants merchants to promote the holiday if reinstated, and said he hopes the council will consider having the decision stand for more than one year, although the council could again opt out.

"They will make that decision every year," Rediger said, "but I think we need to have it in our minds that it isn't good for our citizens and it isn't good for the merchants to have that come on and go off."

The city's finance department estimates the hit to revenue from not charging sales taxes that weekend would be about $57,000.

eragan@semissourian.com

388-3627

Pertinent address:

401 Independence St., Cape Girardeau, Mo.