Use-tax revenue could fund street improvements, higher Scott City employee wages

For Scott City Mayor Norman Brant, approving a use tax is "a no-brainer."

Brant said Wednesday a use tax could generate $200,000 or more annually if passed by voters Nov. 2. Revenue generated from the tax may go toward street improvements and boosting city employees' pay scale.

Brant said the proposed levy, also referred to as an internet sales tax, will be identical to Scott City's current 1.75% sales tax if passed by a simple majority vote.

A use tax is not a double tax, Brant said. Residents would never pay a use and sales tax at the same time. It would only levy a tax on goods bought online and from out-of-state companies.

As more people opt to buy items online, Brant said cities miss out on potential revenue since the purchases currently aren't eligible for sales tax.

Brant encouraged residents to buy local and purchase goods from Scott City, Cape Girardeau and Jackson stores. However, the mayor noted Scott City has one of the lowest sales-tax rates compared to nearby cities.

"You can buy something [online in Scott City] and pay the use tax, and it'd still be cheaper than if you go to town and buy it," Brant said.

Brant said he hoped to apply a portion of use-tax funds to raise the pay of city employees. The city is well staffed, according to Brant, but he wants to ensure Scott City maintains its employee retention as government wages rise elsewhere.

Brant also expressed his intent to fix pay disparities among city employees.

"We've got some employees that make a good wage, and we've got some that are pretty low on the totem pole," Brant said. "The city employees we have now are probably the best we've ever had, and we're trying to raise them up and get them good benefits."

Brant added use-tax revenue could also be used to improve city streets.

"With our current budget, we don't have enough money to asphalt our streets, and they're getting worse," Brant said.

According to the mayor, Scott City spent approximately $400,000 last year to overlay portions of streets throughout the city. Use-tax revenue would assist the city in continuing where it left off in overlay asphalting.

Brant said a use tax would benefit Scott City, no matter how the City Council decides to spend revenue from the tax. Times are changing, according to Brant, and Scott City needs to keep up.

Missouri is the last state in the country to approve legislation for the taxing of internet sales.

Gov. Mike Parson signed the Wayfair bill June 30, allowing Missouri and local jurisdictions to collect an online use tax "that will help protect Missouri's brick-and-mortar businesses," the governor said in a statement.

Nearly half of Missouri cities with populations larger than 2,000 residents already have a use tax in place.