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AGENDA ITEM REVIEW FORM |
2.B.
Work Session
- Meeting Date:
- 01/06/2016
- Department Head:
- Kay Macuil
- Submitted By:
- Kay Macuil, City Attorney, Attorney's Office
Action Requested:
Discussion Item - No Action to be Taken
ITEM:
Discussion only item of the possibility of a tiered sales tax rates for the City of San Luis. (Kay Marion Macuil, City Attorney)
SUMMARY:
The Mayor requested this item be put on the work session agenda in order to inform and discuss with Council of the possibility of tiered sales tax rates. Tiered sales tax rates would have a lower tax rate on high-priced items. The idea would be to encourage the purchase of high-priced items in San Luis as well as encourage businesses with high-priced items to sell to set-up their shops in San Luis.
Tiered sales tax rates work where the lower rate is applied to one high-priced item being purchased rather than a number of small purchases adding up to a high price. This is so because it would be difficult for businesses to set up their cash registers for different tax rates and also for the City to monitor and collect the different rates.
The legal process to adopt new tiered rates under A.R.S.§42-6054:
•60-days of notice on the City's website of a possible change in the sales tax rate,
•15-days of notice in the newspaper (this can run at the same time as the 60-day notice is running on the website),
•Council then holds a public hearing,
•Council may then vote to pass an ordinance after the public hearing, and
•such an ordinance would become effective 30 days after passing the ordinance.
A more detailed explanation is provided in the attached memorandum which Assistant City Attorney Glenn Gimbut wrote to assist Council to make an informed decision about tiered tax rates.
Tiered sales tax rates work where the lower rate is applied to one high-priced item being purchased rather than a number of small purchases adding up to a high price. This is so because it would be difficult for businesses to set up their cash registers for different tax rates and also for the City to monitor and collect the different rates.
The legal process to adopt new tiered rates under A.R.S.§42-6054:
•60-days of notice on the City's website of a possible change in the sales tax rate,
•15-days of notice in the newspaper (this can run at the same time as the 60-day notice is running on the website),
•Council then holds a public hearing,
•Council may then vote to pass an ordinance after the public hearing, and
•such an ordinance would become effective 30 days after passing the ordinance.
A more detailed explanation is provided in the attached memorandum which Assistant City Attorney Glenn Gimbut wrote to assist Council to make an informed decision about tiered tax rates.
RECOMMENDATION / SUGGESTED MOTION:
Discussion only item, no action.
Fiscal Impact
- IS THERE FISCAL IMPACT ASSOCIATED WITH THIS ITEM:
- N/A
- CITY/STATE/FEDERAL FUNDS:
- N/A
- TOTAL:
- N/A
- BUDGETED:
- N/A
- AVAILABLE TO TRANSFER:
- N/A
- ACCOUNT #/REMAINING BALANCE:
- N/A
FISCAL IMPACT STATEMENT (IF THIS IS A BUDGET TRANSFER, YOU MUST ATTACH THE BUDGET ADJUSTMENT FORM):
At this time this item is presented to Council for discussion as an idea. There are no proposals at this time for specific numbers for the sales tax rates. Council may direct staff to bring back specific recommendations.