City tax to increase in 2001 | CraigDailyPress.com

City tax to increase in 2001

Christina M. Currie

City residents will experience a sales tax increase, but it won’t affect their pocketbooks for another year.

A .25-percent increase in the sales tax approved by voters in April, 1998 doesn’t go into effect until December, 2000 and residents won’t feel its impact until January, 2001.

According to City Finance Director Bruce Nelson, the city has been receiving calls from residents and business owners asking when the sales tax increase will take effect. According to Nelson, the Taxpayers Bill of Rights (TABOR) amendment only allows for tax increases to start in January or July. The ballot question requested voters increase the city sales tax in December, 2000 so the city cannot implement it until Jan. 1, 2001.

Several years ago, the city was in financial straights and the Moffat County Board of Commissioners agreed to give it 1.5 percent of a 2 percent countywide sales tax. In November, 1997, voters approved transfering .75 percent of that 2 percent back to the county.

Officials estimated the city would lose about $800,000 in revenue from the transfer so city officials agreed to ask voters for two things. The first was to extend a .5 percent sales tax used to repay water bonds. That tax was set to expire in December, 2000. The second question was to raise the current city sales tax by .25 percent for a total .75 percent sales tax increase. Because most of the increase is only an extension of a current tax, consumers will only see a .25 percent increase, bringing the city sales tax from 2 percent to 2.25 percent.

The measure passed with 59.2 percent of the vote.

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Consumers should expect the increase on Jan. 1, 2001. At that point, the total of city, county and state sales tax in Craig will be 7.25 percent.