As uncertainty shrouds property tax, Basalt’s sales tax revenues hold steady
The town of Basalt has collected about $1.93 million in sales tax revenue during the first third of the year, according to a report filed Monday.
The sales tax revenue year-to-date through April are up about 1.7% from the $1.89 million collected at this time last year, said the report by town finance director Christy Hamrick.
Sales tax generation could get extra scrutiny this year as controversy swirls around the town’s past property tax collection. The town raised the property tax mill levy 10 times since 2010 without voter approval. That was an apparent violation of the Colorado Taxpayers’ Bill of Rights constitutional amendment.
In sales tax collections this year, the strongest sectors of the town’s economy have been general retail stores (up 7.4%), sporting goods retail stores (up 4.9%), and building materials (up 78.2%).
Hamrick noted that the numbers in some categories are skewed this year because she reclassified some vendors when she became finance director in May 2018. The reclassification was an effort to get businesses in the category that best reflects their type of sales, she wrote in her report.
In addition, sales tax reports have been affected by new state rules that require vendors to pay sales taxes for any goods delivered to the customer within the town, regardless of the location of the business. That affects online sales.
Basalt’s bread-and-butter sales tax generator is running behind last year’s pace. Retail foot outlets — anchored by Whole Foods and City Market — were down 3.3% for the year through April, the report showed. Retail food outlets generated $740,940 in sales tax revenue through April compared with $765,853 for the same period last year. Restaurants with bars were flat compared with the first third of last year. They generated $163,405 in sales tax revenue, up 1.3%.
On the property tax front, a town survey showed the majority of respondents want a refund for their overcharge. That could cost the town a cumulative $2.3 million. State law sets a statue of limitations for four years of liability for property tax overcharges.
The town will have to get voter approval in November to maintain the current mill levy of 5.957. The council also will contemplate this summer if it should ask a separate ballot question on whether a refund should be given to property tax payers. The council also could decide just to give the refunds.
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