Sales-tax options

Preparing government budgets, particularly at the local level, will require some financial ingenuity and prudence this year. Cape Girardeau's finance director recently told the city council that the general economic slowdown and rising costs are creating a significant pinch.

Among many budgetary considerations are the sales-tax holidays available to Missourians this year. A few years ago, Missouri adopted a sales-tax holiday in August for back-to-school shopping. The state sales tax is not collected during the holiday weekend, but local governments can opt out if they choose. Most local taxing entities have not opted out in years past, but tighter fiscal constraints this year are prompting further consideration.

This year, the Missouri Legislature has adopted two other sales-tax holidays. One, in June, is intended to encourage Missourians to spend their economic-stimulus tax rebates from the federal government without having to pay state sales tax. Local sales taxes would still be collected. The other, in November, eliminates sales tax on certain energy-efficient items, and local taxing entities could opt out.

It's good that the legislature listened to local governments as it developed both new sales-tax holidays. The original bills did not provide for local governments to opt out. In tight financial times, the fewer strings on local elected officials to make sound budget decisions the better.