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Local cities may join forces on use tax messaging

By: Brian Flinchpaugh


St. Charles County cities who have placed a “use tax” on their Aug. 7 ballots may pool resources to send out information regarding them.

Cottleville, Lake Saint Louis, O’Fallon, St. Peters, St. Charles, Weldon Spring each have placed separate “use tax” positions on their ballots. A use tax is a sales tax applied to the purchase of goods purchased from out-of-state vendors that annually total $2,000 or more.

Currently, sales taxes apply only to local retail purchases. A use tax is designed to capture lost sales tax revenue. It is applied to the same type of products that are subject to sales tax and items exempt from sales taxes would be exempt from use taxes. Use tax rates must be reduced or raised the same amount as city sale taxes or reduced or raised.

Use taxes have to be considered and voted on separately in each municipality; however, city officials are exploring using some common messaging in explaining the tax.

Lake Saint Louis Police Chief Chris DiGiuseppi is helping to organize a committee of city residents, headed by former Lake Saint Louis Police Chief Mike Force, to support the passage of the use tax in that city.  DiGiuseppi told the city’s Board of Aldermen at its April 16 meeting that by joining together, smaller cities may able to use video production and other resources from larger cities in developing public information messages on the tax.

“The cities cannot tell somebody how to vote,” said Lisa Bedian, the communications director for St. Peters, last week.  “What we try to do is provide educational information.”

Bedian, whose city has a large communications staff, said discussions have just begun.

“It’s really at the formative stage. It’s a good idea for cities to be sharing information or making sure their information is clear for the voters,” Bedian said.

Use taxes aren’t new. Currently, 45 states and 105 Missouri cities with populations of more than 5,000 already have use taxes in place, including Wentzville, Foristell, the state of Missouri and St. Charles County. However, as Bedian pointed out, “It’s not talked about very often.”

Use taxes can generate significant annual revenue for cities, perhaps as much as $2.8 million for O’Fallon, $400.000 for Lake Saint Louis and $65,000 for Cottleville, according to estimates by the Missouri Municipal League, though some city officials are skeptical.

Each city would make its own decision on where the funding would go. St. Peters and Lake Saint Louis have discussed using use tax revenue for police and law enforcement purposes.

 

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