Use tax question going back on election ballot

This story has been edited to correct the status of a use tax in Scott County. That county passed a use tax the second time it was on the ballot.

Cape Girardeau County Commissioners voted unanimously Tuesday to approve a 1 percent use tax subject to voter approval, after hearing little discussion and no opposition during a public hearing on the matter.

The vote was held immediately after the public hearing, where only two people spoke -- both of whom noted the need for widespread education on the use-tax issue. Cape Girardeau County -- along with the cities of Cape Girardeau and Jackson -- had a use-tax question on the April 2014 ballot that failed. Some questioned at the time whether a lack of understanding led to the tax being voted down.

The voter-approved use tax can be levied on out-of-state purchases of titled vehicles, including automobiles, boats and other recreational vehicles, along with purchases of other "tangible personal property" as defined by state law. Consumers are required to file a use-tax return with the Missouri Department of Revenue only if their untaxed purchases from out-of-state vendors in a calendar year equal more than $2,000.

Use-tax questions began popping up on ballots across the state after a state Supreme Court decision in March 2012 changed the way local counties and municipalities could collect taxes on vehicles.

Until that time, no matter where a person bought a car, sales taxes were paid during its registration according to the rate associated with the buyer's home address. The ruling said local sales taxes could not be levied on out-of-state purchases of motor vehicles, trailers, boats and motors.

In 2013, Gov. Jay Nixon signed a law allowing municipalities to resume collecting the taxes but required them to hold elections about use-tax questions before November 2016. Before the law's passage, however, only the state use tax of 4.225 percent was levied in areas with no local use tax, giving many Missouri customers an incentive to travel to neighboring states such as Illinois to buy vehicles and other big-ticket items and avoid potentially hundreds of dollars in taxes.

The use-tax question has been posed in other local counties and cities in recent years, including Perryville, Perry County and Bollinger County -- where it was approved by voters -- and in Stoddard County, where the measure failed. A use tax was passed in Scott County after it failed the first time on the ballot.

When Pat Wissman stood to deliver his thoughts at the public hearing, he said commissioners faced the responsibility of explaining the many sides to the use tax and how it will affect taxpayers.

"People need to be aware," he said.

Former presiding commissioner Gerald Jones also said getting voters to approve a use tax was "going to take a lot of education," but he encouraged commissioners to put the issue on the ballot.

"It's very unfair to local businesses to not have a use tax," he said. "I'm a very big supporter of a use tax. ..."

While the measure has been touted as a way to "even the playing field" for local businesses, Cape Girardeau County has something more to gain from the tax. Its funds will be used for capital improvements projects, including a new courthouse facility. Commissioners recently approved a recommendation from a citizen advisory committee that calls for court services and county offices to be moved to a new courthouse in Jackson. The recommendation includes constructing a parking garage and demolishing the administration building.

The group spent about a year making its county-offices decision, speaking with county officeholders and taking tours of the facilities. Associate Commissioner Paul Koeper said down the road, the county would like another citizen advisory group to work with architects throughout the process of designing the new courthouse.

The matter of when, or whether, that step occurs is up to voters, as the use tax question is scheduled to appear on the April ballot.

"Until we have a funding source, we can't go any further," Koeper said. "That's where we're at right now."

srinehart@semissourian.com

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