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Commission Eyes Reviving Use Tax Issue

Posted on Tuesday, June 26, 2018 at 3:30 pm

By Ethan Colbert
bgted@lcs.net

A ruling issued on Thursday by the United States Supreme Court could greatly impact how Pike County government is funded, according to local elected officials.
In the majority ruling of South Dakota v. Wayfairer, the court ruled that states can pass laws requiring out-of-state sellers to collect sales taxes.
Richard Sheets, the deputy director of the Missouri Municipal League, said in a telephone interview on Tuesday morning that he believes the ruling not only applies to state governments, but also to city and county governments.
The high court’s ruling made it clear online purchases should be treated just like the transactions that occur within brick-and-mortar stores and businesses housed in the state.
Currently, Missouri law only allows for sales tax on online purchases to be collected if business has a location in the state or if the consumer makes the purchase through a referral of a Missouri-based company.
Closer to home, Pike County currently does not collect any revenue from sales conducted over the internet.
That could change, according to Monday’s meeting of the Pike County Commission.
As a result of the Supreme Court ruling, Sheets said local governments should be able to levy their various sales taxes on all online purchases without having to seek voter approval of a use tax.
If this proves to be the case, then Thursday’s ruling is good news for Pike County, where voters have rejected a use tax twice in recent county history.
In August 1996, voters rejected a use tax that would have created a one percent sales tax that was applicable to all goods purchased out of the state of Missouri.
Pike County voters rejected the proposed use tax by 176 votes, according to election records kept by the Pike County Clerk’s office.
In 1996, 1,774 voters voted in favor of the proposed tax, while 1,950 voted against it.
More recently, voters rejected the proposed local use tax in April 2013.
The 2013 version of the use tax would have created a new sales tax, which would have been set at 1.5 percent and would have been used for the construction and maintenance of hard surface roadways in Pike County.
The 2013 version of the use tax was defeated by a margin of 348 votes after 758 Pike County voters cast ballots in favor of the proposition and 1,106 voted against it.
Western District Commissioner Bill Allen said during Monday’s meeting of the three-person governmental body that he didn’t understand why voters rejected the proposed use tax in 1996 and in 2013.
Allen also said that the county commission should not wait for Missouri General Assembly to take action during the 2019 legislative session.
“My personal feeling is that we do not need to wait for the state legislature to do something,” Allen said. “If we need to get it on the ballot, then we need to get it on the ballot. If the legislature does something after it is passed, then we deal with that, but I am not going to put something that we need in Pike County on hold to wait for the state legislature to do something.”
According to officials within the Pike County Clerk’s office, the deadline for the Pike County Commission to place an item on the August ballot has passed. Meanwhile, the deadline for the commission to place an item on the November ballot — August 28 — is quickly approaching.
The submission deadline for the April 2, 2019, Municipal Election is January 22. As there are currently no other elections scheduled in 2019, the Pike County Commission could also call for a special election.
It is unclear how much money a sales tax on internet purchases would generate for Pike County’s coffers. For context, Cape Girardeau County recently posted in a story published in the Southeast Missourian newspaper that they are anticipating collecting more than $1 million in revenue from their internet sales.
Other neighboring county treasurers were unavailable for comment on this story.
On Monday, Allen said he didn’t believe the county commission should try to rush to place an item on the ballot for November 2018.
“Nothing can get done this year,” Allen said. He later said that by delaying a vote on the use tax, it gives the county commission time to educate voters on what the proposed use tax is and how it would benefit Pike County.
Meanwhile, Eastern District Commissioner Justin Sheppard said he believed the county commission should wait for elected officials in Jefferson City to take action.
“I think the first course of action is to wait and see what Jefferson City does,” Sheppard said.
Pike County Treasurer Patti Crane said she also believed the county should delay a vote on the use tax, but that the county should actively be researching and working on answering the procedural questions that would accompany the ballot measure.
“I think we need to be researching this now,” Crane said. “I don’t know if there is anything we can do at this point other than researching. We need to be talking to our State Representative. We need to see what the state is planning on doing. We need to talk to other counties in the state to figure out how they are handling this. If there is something that we can do to be ready to go in place when they have it on the ballot, then we should be doing that now.”
Crane later added that she did not believe county officials should delay a possible vote on the online sales tax in order for the state legislature to address the issue.
“Why should we miss out on six months of revenue or more, because they aren’t in session or have not passed a bill on this issue,” Crane said. “We need to be proactive rather than reactive.”

 

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