Proposed Sales Tax Is What It Is
At a recent Paden City Council meeting, discussion was held on a one percent sales tax the city is considering. Mayor Hochstrasser was quoted as saying, “This is not a city tax. Let’s not get people up in a roar.” We believe that statement to be inaccurate and misleading. It should be clarified that the tax would indeed be a city tax. It is a city tax because the city must submit plans and file an application for it. Who is going to impose the tax? If approved by the state, the city will impose it!
However, by law the city must then use the services of the West Virginia State Tax Commissioner to administer, enforce, and collect the tax. Then they must pay five percent of the tax collected to the state.
A one percent sales tax on purchases within the city would be an additional tax on every person who shops at community businesses. The City cannot just add the one percent sales tax without first filing an application and meet the requirements of the W.Va. Municipal Home Rule laws as amended in 2015. One of the requirements of implementing a sales’ and use tax is the city must reduce or eliminate its business and occupation tax. So, you remove tax from business and occupation, lay it on the shoulders of residents and say it’s not a city tax?
The tax in theory would generate income for the city, but with a small community business base would it be a deterrent to shop local and a burden on local shoppers? In order for a one percent business tax on sales to be effective you must first have businesses. This just may be a major blow to the few businesses now located in Paden City. City Attorney Carolyn Flannery said it right, “It’s not as easy as just voting on it.”