Valley Grande considers tax hike
Published 11:11 pm Tuesday, June 8, 2010
The Valley Grande city council reviewed a sales tax proposal, which would increase the city’s sales tax from 2 to 3 percent.
“This was the ordinance that would put on first reading for the next meeting (June 21),” said Valley Grande Mayor Tom Lee. “It is the original taxation ordinance amended to move the city from 2 percent municipal tax to three percent, because of a 1 percent increase in sales tax only.”
The increase would raise the city’s overall sales tax from 7 percent to 8 percent.
Lee said the proposed increase would initially be used to fund the proposed athletic facility, which is estimated to cost the city more than $100,000, over a two-year period without the city incurring any debt.
“You don’t want to pass a tax just to accumulate money,” said Lee. “So the thrust of the tax proposal is to get into the athletic arena and give the people out here something to where they can stay around here and play.”
According to Lee, last year Valley Grande gave back 46 percent of the total income of the city through donations to fire departments, schools, libraries and other projects.
“Our sales tax was more than $130,000 dollars at two percent this prior year, and that was a recession year,” said Lee. “One percent more on the sales tax would give an estimated $65,000 increase which would pay for the fields.”
Lee said after the fields were paid off that the city would be able to find other uses for the money including increased security and a proposed salary for the next city council.
“It will give the city the money that it needs to fund the programs that we need,” said City Councilperson Marie Middlebrooks. “And a sales tax, to me, is the fairest tax that we could change.”
Tim Gibbs, the owner of Valley Grande Pharmacy, said that he doesn’t believe that the 1 percent sales increase would be too bad for business.
“Eight percent is pretty common,” said Gibbs. “So business wise I don’t think that it will affect us that much. Pharmaceutical items do not have a sales tax anyways, but our front merchandise should be fine.”
Gene Hisel, owner of the BP station on Highway 22, said that the tax increase is needed.
“We need it for revenue,” said Hisel. “We need it for public services, safety and other things.”
Hisel said gas prices would not change with the increase in sales tax.
“All petroleum items have their own special tax,” said Hisel. “They don’t have a sales tax.”
Under this new proposal, if you were to buy $50 worth of groceries at Valley Grande Market right now you would spend a total of $53.50.
If the sales tax increase were approved, that total would move to $54.