Taylor Discusses Raising Sales Tax

The Town of Taylor finds themselves in a position of needing to revisit increasing the sales tax for the town. Begrudgingly, Town Manager Lundberg admitted that there is a need for increasing the sales tax and that they would be putting themselves at a disadvantage in regards to the services they could or would want to provide if they didn't consider it. 

Taylor’s largest source of income is the business sales tax it collects from the town. If the change is approved, local sales tax would increase from 2% to 3% across all business categories. In addition to the increased sales tax, the council is considering adding a new tax referred to as the ‘Use’ tax. The Use tax would apply to goods purchased from businesses that do not have a physical presence in Arizona and are not currently required to pay such a tax. The Arizona League of Cities and Towns weighed in with this advice for the council and townspeople to consider with this new tax item: “Use tax is an essential element of sound a tax policy because it levels the playing field for all local businesses that are subject to retail tax rate by imposing equal tax on businesses located outside of Arizona that make sales to town residents. Failure to impose a Use tax effectively grants businesses out of state a price advantage over local sellers.” Essentially, this new Use tax would help close the gap for our small businesses and hopefully encourage our residents and passersby to shop local.

These taxes would be paid during checkout incorporated into the normal Taxes and Fees and returned to Taylor at the end of the business tax seasons. 

The Mayor stated, “ As much as I don’t want to have those tax(es) increased, if we don’t do something we could be looking at being behind the eight ball with how things are going around here...We’re behind everyone around us.”

There was much discussion about the local census and rapid growth we are seeing and how our local first responders and emergency personnel are already responding to two or three times the amount of calls than other towns around us. Those towns have a much higher budget than Taylor does. This only aids to the disparity after you consider that Taylor responds frequently outside of their municipality as well.

Additionally, Lundberg made it a point to clarify that Residential Tax Rates were not included in this proposal at this time and that if the need to modify those rates occur, they would address it separately with a vote of the people. Commercial tax rates will remain the same for now as well.

The proposed timeline to make this change effective would be as follows:

The Notice of Intent will be finalized and ready for approval by city council by the next City council date of October 2nd.  At the same time, the City Council will schedule a hearing regarding the matter for the public. Pending approval on October 2nd, the hearing would be scheduled on January 6th, 2022, and if it passes, it will become effective as of April 1st, 2022.

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