Two tax issues are being proposed to voters today (Nov. 3) in Richmond Heights.
Proposition U, would assess a sales tax – commonly known as “use tax” — on purchases over $2,000 made out-of-state that are exempt from in-state sales tax.
In-state purchases are taxed at a rate of 8.613%, of which 1.00% is the Countywide Point of sale (POS) tax that is shared countywide, 1.50% is local sales tax that Richmond Heights collects and also shares a portion of countywide.
Should the voters of Richmond Heights approve the local use tax, 1.50% will be added to Missouri’s 4.225% use tax on purchases over $2,000 that are exempt from sales tax.
Proposition U would be a “new” tax, one that residents and commercial businesses would report to the state, if the accumulative purchases amounted to more than $2000 in a year and were purchased out of the State of Missouri, according to a presentation on the tax before the Richmond Heights City Council in September.
Proposition V asks voters to repeal the application of the local sales tax to the titling of motor vehicles, trailers, boats, and outboard motors that are purchased from a source other than a licensed Missouri dealer. Proposition V is a technical amendment necessary under Missouri law to allow collection of the new use tax on out-of-state vehicle purchases.
Today’s ballot issues would mean Richmond Heights residents would be subject to taxation they currently do not pay on out-of-state purchases, city officials noted at the aldermanic meeting. However, passage would mean additional revenues for the funding of city services such as funding police and fire services, parks and recreation and street maintenance.