Westover passes first sales tax
Published 12:00 am Tuesday, February 18, 2003
The cost of retail merchandise, amusement, farm and mining equipment sold in the town of Westover is rising.
And depending on the type of business, the increased costs could be as much as 2 cents on the dollar.
Currently Westover sales are subject only to state and county sales taxes totaling 5 cents on the dollar. That will all change on April Fools Day 2003 when the sales tax will rise to as much as 7 cents on the dollar on some items.
Westover’s Town Council approved the fledgling municipality’s first privilege, license and excise taxes (sales tax) at its regular February meeting.
On a vote of three in favor and one against, the council approved the ordinance to establish a privilege, license or excise tax against those &uot;storing, using, otherwise consuming or engaged in the business of selling at retail tangible personal property or conducting places of amusement in the Town of Westover.&uot;
The ordinance also provides for the collection of the taxes and penalties for violation of the ordinance.
According to the ordinance, a privilege or license tax
is levied and will be collected
&uot;against the person on account of the business activities and in the amount to be determined by the application of rates against gross sales, or gross receipts as the case my be…&uot;
Voting were Mayor Roger West and Councilmembers
Larry Riggins and Bobbie Bradberry in favor and Councilmember Bobby Pardue in opposition. Councilmember Susan Wooten was not in attendance at the meeting, and councilmember Lori Gardner said she was &uot;undecided&uot; and
abstained from the vote.
The tax ordinance was originally introduced on Jan. 14 of this year.
On hand to speak against the sales tax was Bill Gayle of Westover Tractor & Equipment. However, following the vote, Gayle accepted defeat stating, &uot;I tried and lost.&uot;
In Gayle’s case, according to the tax ordinance, the sale of farm equipment
will be taxed at one-half percent, or one-half-cent per dollar. He indicated to the council that he may not necessarily be able to pass the increase on to customers.
Gayle told the council that recently a customer told him he got 10 prices on an $11,000 piece of equipment.
&uot;If you pass (a sales tax), what is it going to do for the businesses in Westover? What benefit do I have for being in the (town) of Westover? I just think you need to look at all the ends of it for attracting more businesses to Westover,&uot; he said.
Mayor West responded that additional services for the city such as a police department can only come with the building of revenues.
He said the passage of a sales tax has been delayed by the council as long as it could, and he explained that an increase in ad valorem taxes, or property taxes, on the other hand, would hurt people on fixed incomes who could not escape it.
Gayle was not the only voice of opposition. Councilmember Pardue said he felt it was too early in the town’s history to impose the tax.
Westover became a town in 2000.
West countered that earlier was better than later when there were already two or three car dealerships in the town and the council decided to impose a sales tax. He said it would look awkward and would be awkward if the council waited any longer.
Councilmember Riggins suggested Westover could compare its lower sales taxes with those of surrounding cities.
He said he hoped to have people going out to recruit retail businesses, but he wants them to have all the information upfront.
Councilmember Bradberry said the tax &uot;is just one sign&uot; the city
is doing something.
&uot;We have been here two years and we have not done one thing. If we are going to do something, let’s do it. I’m getting old,&uot; she said.
Following the vote to approve the tax, West said, &uot;We wouldn’t have done it if it wasn’t the best thing for Westover.&uot;
The following is a general overview of the provisions of the tax ordinance:
The ordinance approved by the council sets a 2 percent tax on the retail sale of personal property by persons, firms, corporations and institutions of higher learning engaged or continuing within the town. Also included are any association, agency or &uot;instrumentality&uot; of institutions of higher learning.
Excluded are bonds or other evidence of debts or stocks and
sales of material supplies to anyone fulfilling a contract for painting repair or reconditioning of watercaft and commercial fishing vessels over five tons.
It provides, however, that any person conducting business as a retailer and wholesaler in Westover will pay the tax required on the gross proceeds of retail sales at
the rates specified when books are kept to show separate gross proceeds from the sales of each business.
When books are not kept separately, those persons will pay the tax on the total gross sales of the business.
The 2 percent tax also applies to the gross receipts of places of amusement or entertainment, including athletic contests conducted by or under the auspices of educational institutions within the town or any athletic association or other association, where admission is charged. That also includes public bathing houses and dance halls of every kind.
Public primary and secondary schools are exceptions, however.
According to the ordinance, tax amounts which would have been collected by primary or secondary schools
can be kept by the school and used for school purposes.
A 1 percent tax is imposed on the gross proceeds of the sale of retail machines used in mining, quarrying, compounding, processing and manufacturing tangible personal property and the parts of such machines, as well as attachments and replacements.
A one-half-percent tax is imposed on the gross proceeds of the sale of automotive vehicle or truck trailer, semi-trailer, house trailer or mobile home set-up materials and supplies.
However, when such equipment is pulled from the sale inventory for use by an employee or agent in the operation of such a business, a fee of $2.50
per year will be charged while the property remains in the possession the employee or agent.
A tax of one-half percent will be charged on the gross proceeds of the retail sale of any machine, machinery or equipment used in planting, cultivating and harvesting farm products or used in connection with the production of agricultural produce or products, livestock or poultry on farms and the parts of such machines, as well as attachments or replacements.
The one-half percent with respect to parts, attachments and replacements will not apply to automotive vehicles or trailers designed primarily for public highway use, except farm trailers used primarily in the production and harvesting of farm commodities.
When such equipment is taken in trade or a series of trades as credit or partial payment on the sale of a new or used machine or equipment,
the tax levied will be paid on the net difference.
A tax of 2 percent the retail selling price is levied to those selling, through coin-operated dispensing machines, food and food products for human consumption (not including beverages other than coffee, milk, milk products and substitutes).
The ordinance provides for an excise tax after the effective date on the storage, or other consumption within the town as follows:
Two percent on the sales price of tangible personal property purchased at retail (watercraft exemption applies); 1 percent on the sales price of machines used in mining etc.;
one-half percent on the sales price of equipment used in planting, cultivating and harvesting of farm products or used in connection with the production
of agricultural produce or products, livestock or poultry on farms and parts of such machines and attachments and replacements.
The farm-related equipment excise tax does not apply to any automotive vehicle or trailer designed primarily for highway use, except farm trailers used primarily in the production and harvesting of agricultural commodities.
Also when such equipment is taken in trade or a series of trades, as a credit or part payment on the sale or a new or used machine, the tax will be paid on the net difference