Swapping agencies will hopefully pay offPublished 10:37pm Saturday, September 14, 2013
By swapping the agency that oversees the city of Selma’s sales tax collection, Selma leaders are showing the community they recognize the problem and aren’t standing pat. Instead, they are attempting to push forward, partnering with a more powerful agency to solve the problem.
The problem — nearly $500,000 in sales tax that the city is owed from local businesses — is a major one for a city that doesn’t need anything cutting into a city budget that isn’t exactly filled with gold.
But, swapping from Revenue Discovery Systems to the Alabama Department of Revenue should help cure the problem. City leaders feel the ADOR demands more respect when it comes to tax collection and they are right. Our guess is that business owners will cringe if a representative from ADOR knocks on their door, accusing them of tax evasion or misreported earnings.
The numbers are pretty staggering. As of Aug. 31, the city had collected around $9 million in sales tax, nearly $300,000 less than last year. That’s quite a chunk of change.
Convenience stores and tobacco stores are believed to be the major culprits behind the decline in tax collection, but the problem appears to be widespread.
A little misreported data here, a little misreported data there and all of a sudden a small problem from one local business becomes a widespread epidemic, cutting into the city’s budget.
The point again is the city recognized the issue and is moving forward from it. Expectations are the ADOR will not just throw a bandage on the problem, but will fix it almost entirely.
We believe Selma will benefit from the swap and we applaud the leaders of the community for pushing for the change and then making the swap, despite ADOR charging a hair more of a percent of all sales tax collected.
Paying sales taxes to a city is part of doing business and we hope everyone is doing their fair share.
If not, we encourage ADOR to find those who have not paid what is required and ask them to settle up.