Council debates sales tax holiday, takes no action

A majority of Cape Girardeau City Council members favor a state-allowed sales tax holiday for back-to-school supplies in August despite Mayor Jay Knudtson's concern that voters might see it as financially irresponsible when the city is facing budget woes.

Knudtson said that viewpoint needs to be considered because the city council is asking voters to approve a quarter-cent fire sales tax in June to provide added funding for fire and police department operations.

"If we didn't have a tax issue coming up in June, it would be a simple decision to make," Knudtson said.

Councilwoman Evelyn Boardman said she would prefer not to suspend the city's 2 percent sales taxes when the city's "talking about shortfalls and budgetary concerns."

But a majority of council members said they favor suspending the city's sales taxes on specified back-to-school items from Aug. 13 through Aug. 15 as allowed under state law.

The council, however, said it would wait until its May 17 meeting to allow time for the Cape Girardeau Chamber of Commerce board of directors to weigh in on the issue.

Councilman Charlie Herbst said he believes a Missouri Chamber of Commerce analysis that suggests the city will see increased sales tax revenue because shoppers making back-to-school purchases also will buy more taxable items.

Councilman Hugh White argued that the council would be showing "good will" by suspending local sales taxes. Councilmen Matt Hopkins and Jay Purcell also voiced support for the sales tax holiday.

Councilwoman Marcia Ritter said she wants to hear from the chamber board before the council takes a vote.

The council has to notify the Missouri Department of Revenue by July 9 if it plans to charge city sales taxes on the second weekend in August.

Knudtson said shoppers still would benefit from the suspension of the state sales tax even if the city doesn't suspend the local taxes on back-to-school items.