Out-of-State Motor Vehicle Sales Tax Election. Election Day is Tuesday, August 2, 2016
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1 Out-of-State Motor Vehicle Sales Tax Election Election Day is Tuesday, August 2, 2016
2 What is the issue on the ballot? On Tuesday, August 2, Blue Springs voters will be asked whether or not to discontinue the collection of the city s sales tax on motor vehicles, trailers, boats and outboard motors purchased from out-of-state dealers. Why is this issue on the ballot? In 2012 the Missouri Supreme Court ruled that cities without a use tax (a tax similar to a sales tax that is imposed on out-of-state purchases) would be required to discontinue collecting local sales tax on out of state purchases of motor vehicles, trailers, boats and outboard motors unless an election is held allowing voters to vote against discontinuation of the tax. If the question is not placed on the ballot, or if the tax is discontinued by voters, the tax would cease to be collected beginning November 2018.
3 Is this a new tax? No. The city has collected this tax for many years. The question is on the ballot only as a result of the Missouri Supreme Court decision and the state legislation that followed. If the question is not placed on the ballot, or if the tax is discontinued by voters, the tax would cease to be collected beginning November How Does the Tax Affect Me? The tax only applies to you if you purchase a motor vehicle, trailer, boat or outboard motor from out of state. Similar purchases made in-state will be subject to the local sales tax regardless of the vote on this ballot question. In Missouri, state and local sales tax on motor vehicles, trailers, boats and outboard motors is collected by the Missouri Department of Revenue, when the purchaser applies for a new title for the vehicle (a requirement for vehicle licensing.)
4 Is There an Impact on Local Dealerships? Yes. The existence of the tax creates a level playing field for Missouri dealerships. If the existing tax were to end, Missouri dealerships would be at a competitive disadvantage with out-of-state dealerships. Are Other Communities Impacted? Yes. A number of jurisdictions and municipalities across the state will be voting on this issue. Locally, the City of Independence, City of Lee s Summit, City of Grain Valley, City of Greenwood, Central Jackson County Fire Protection District (add others as information becomes available) will be voting on the issue this August.
5 How much tax revenue is in question? $339,000 Estimated annual City revenue collected from out of state vehicle taxes. Friends of the Zoo.125% Fire Protection District.5% Jackson County 1.125% Motor Vehicle Sales Tax Rate is 7.975% City 2% State 4.225% If this revenue source is discontinued, $339,000 will be removed from the City s budget: General Fund $169,000 Transportation Fund $85,000 Public Safety Sales Tax $85,000
6 What Impact Does the Tax Have on Blue Springs Revenues? The GENERAL FUND provides for a number of vital city services such as police, parks, code enforcement and inspections. The TRANSPORTATION FUND provides services such as street and sidewalk improvements/repairs, street lighting, snow removal, street signs, street sweeping, and tree maintenance. The PUBLIC SAFETY SALES TAX is a dedicated tax that supports police operations including personnel, equipment and facilities. City staff estimates that the budget impact of discontinuing collection of the out-of-state vehicle sales tax is an annual loss of $339,000 beginning in Services would have to be cut to account for this loss of funding.
7 What costs $339,000 annually? General Fund $169,000 3 Parks & Street Maintenance Workers Transportation Fund $85,000 Street overlay and sidewalk repair for 6 city blocks. Public Safety Sales Tax $85, Police Officers AND AND
8 What is the ballot language? Question #1 Shall the City of Blue Springs, Missouri discontinue applying and collecting the local sales tax on the titling of motor vehicles, trailers, boats, and outboard motors that were purchased from a source other than a licensed Missouri dealer? Approval of this measure will result in a reduction of local revenue to provide for vital services for the City of Blue Springs and it will place Missouri dealers of motor vehicles, outboard motors, boats, and trailers at a competitive disadvantage to non-missouri dealers of motor vehicles, outboard motors, boats and trailers.
9 What if I vote NO? What if I vote YES? A no vote Allows continued collection of existing sales taxes. Keeps licensed Blue Springs car dealers competitive with car dealers located out of state. Does not authorize new sales taxes. A yes vote Eliminates collection of city sales taxes on motor vehicles, trailers, boats and outboard motors purchased out of state or from private individuals. Reduces local revenue that pays for vital city services.
10 QUESTIONS? Election Day is Tuesday, August 2, 2016
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