Sales tax hike on ballot

Wednesday, August 4, 2010

Marshall County voters are being asked on Thursday's election ballot whether the sales tax rate should be increased by one-half cent from 9-1/4 cents per dollar to 9-3/4 cents.

Since sales taxes are paid by everyone at the cash register, the levy is frequently described as a fair tax. However, opponents argue that now is not the time to increase costs on local households because unemployment rates here have been the highest or second highest in the state all year.

Marshall County commissioners voted 15-3 on April 26 to ask the election commission to place the question on Thursday's ballot. Commissioners said it's not a referendum. It's a ratification of the commission vote.

Increasing the sales tax rate by one-half a cent would generate $1.2 million in revenues for the county, according to figures reported in April.

If that money came from property taxes it would increase the county's $3.09 property tax rate by approximately 12 cents.

There are delays in when the money could start to flow into the county treasury. However, Christmas shoppers in December would be paying the higher rate. Six months of payments from the state Revenue Department would be received by the county during the fiscal year that started July 1.

Because of agreements between the county and its cities years ago, sales tax revenue is split between those governments with a significant amount going directly to the county school system.

That's resulted in a position taken by a number of commissioners that the new money going to schools would be a dollar amount to cut from the school system's share of property tax revenue.

However, such a change in the allocation of property tax revenue would depend on the people who are elected to the county commission on Thursday.

Another motive for placing the sales tax question on the ballot was a recurring threat that the state might increase sales tax rates in all counties that have not authorized the maximum rate, and then take that additional revenue to help balance the state budget.

It was seen as a "use it or lose it" situation, but it never materialized.