Increase County sales tax?

Orange County is well known as a place that values education and put our money where our mouth is. The County Commissioners have worked hard this year to hold the line on taxes and pending, but progress demands, well, progress. Advocates for the schools are clearly in support of a tax increase. So having tried to pass a real estate transfer tax, and in the face of a slightly-more-rabid-than usual anti-tax crowd, the Commissioners are now considering a sales tax.

The current sales tax rate in Orange County is 7.75 percent -- 5.75 percent for the state and 2 percent for the county. The proposed 1/4-cent tax would increase the local sales tax rate to 8 percent. Unlike a property-tax hike, it would increase the amount of taxes collected directly from tourists and other visitors who buy goods and services in Orange County but don't live here.OrangeChat: 

Do you support a $0.25 sales tax increase?  If not, what other mechanism do you propose to cut spending or raise money?

Total votes: 0


That's the increase on a $100 purchase.  It is $0.0025 increase per dollar spent.  Or the better way may be to call it a 3% increase in the rate.

Just to be sure, you are talking about raising it from 7.75 cents on the dollar to 8 cents, right? That means a 3% increase on the TAX RATE, not an increase of 3% on each dollar spent. 

isn't that what I said?

you are. While the rate increase doesn't seem like much, I'd prefer it for luxury or discretionary items, although I admit I don't know what the occupancy tax rate is in Orange. Maybe it's high enough already. I'm for taxing plastic and paper bags at a penny a pop. People could avoid it by bringing their own bags.

It just enables the incredible theft of our tax money for the military - about $2600 per person per year.

It really depends on how they structure the tax. I support a tax on luxury or discretionay items, such as hotels, dining, and non-food retail sales. However, if the intent is to tax all sales, including food, which would have the greatest impact on those local residents who can least afford it, then I oppose it.

The reason they want the sales tax on every item instead of just discretionary ones is that it brings them more money to tax everything. According to last Sundays Chapel Hill News, the tax rate in Orange County has increased in 23 of the last 24 years.  And we're talking about property tax rates is in an area where property values themselves have increased drastically up until the last couple years.  And now the articles linked to above basically say "If you don't let us raise the sales tax then we're going to raise the property tax again instead."   It's this sort of things along with the first paragraph in the first thread in this post that are such a huge turnoff.  It's the utter relentless of it all along with subtle putdowns and denigration of anyone that doesn't go along.

According to the Action Agenda Item Abstract for this public hearing item, "As authorized by the General Assembly, the new sales tax cannot apply to consumer food purchases" (see paragraph 2, Background section, page 1)

to get this to pass unless its proceeds are targeted toward something that is widely popular.  Even then it will be difficult.

I suspect Joe is correct that voter approval of a referendum is directly related to the intended uses. The agenda abstract states that the referendum can not include language about uses but does recommend that if the commissioners go forward they (a) conduct a public education campaign and (b) adopt a resolution which addresses intended uses.  Thus, I think a key question is just what uses would be popular enough to gain passage, just as 15 other NC counties have done. I think several uses that would be on the short list include paying down general obligation and school construction bonds, plus investing in a a "took kit" for the county's long-dormant economic development activities.  (and successful economic development would lead to increased tax revenues via a larger commercial tax base among other outcomes).


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