OFFICIALS: SALES TAX WON'T HURT BUSINESSES

A higher city sales tax won't hurt business, Cape Girardeau city and civic leaders say.

The City Council will decide Monday whether to put a five-year, half-cent transportation tax on the Aug. 8 ballot.

If voters approve the half-cent tax, consumers will be paying nearly 6.5 cents in state, city and county sales taxes for every dollar they spend. Cape Girardeau would have higher sales taxes than such cities as Jackson, Sikeston and Scott City.

The 6.5-cent figure doesn't include the gross receipts taxes that consumers pay when they eat at a restaurant or check into a motel in Cape Girardeau.

The gross receipts taxes amount to 1 cent on every dollar spent on a restaurant meal and 3 cents on every dollar spent at motels.

Cape Girardeau's sales taxes currently total 5.975 cents on the dollar, which is slightly less than the tax charged in Jackson and Sikeston, and equal to that charged in Scott City.

The proposed transportation tax would increase the total sales tax to 6.475 cents, putting it ahead of the three neighboring towns.

But that doesn't worry Cape's city and civic leaders.

"I don't think there is a significant enough difference to cause an exodus of retail business from one city to another city," said Harry Rediger, manager of J.C. Penney Co.

Rediger heads up the city's Planning and Zoning Commission. He strongly favors a transportation tax.

Rediger said sales taxes are a big plus for Cape Girardeau, which attracts many out-of-town buyers.

Most consumers don't even know how much sales tax they are paying when they shop, Rediger said. "You don't figure your tax first."

City Manager J. Ronald Fischer said the proposed sales tax won't put Cape Girardeau out of line with other communities.

Chamber of Commerce President John Mehner agreed.

Mehner has talked to car dealers and supermarket operators whose businesses generate much of the sales taxes in Cape Girardeau.

Those businesses don't feel a sales tax hike would drive customers away, he said, adding that the real issue is whether Cape voters want the city to address road and bridge needs.

"Do you want these streets in return for half a cent more than what you are paying right now on the dollar?"

Mehner and others are banking that the cost is worth it.