Independence and Blue Springs voters both decisively said no Tuesday to the use tax question, turning down approval for each of those two cities to collect their normal local sales tax for items that citizens purchase online.
Independence voters turned down the use tax 61.5 percent (6,004 votes) to 38.5 percent (3,759), according to Tuesday’s unofficial results from the Jackson County Election Board. In Blue Springs, the margin was 53-47 percent, as 2,406 voters said no compared with 1,810 in favor.
A use tax is in essence a sales tax applied to online purchases from out-of-state companies that have a physical presence in Missouri, and at the same rate as local sales taxes (which are 2.25 cents in Independence and 2.5 cents in Blue Springs).
Cities have bemoaned the lack of a use tax for two reasons – adverse effects to local retailers who lose out on potential sales, and the strain it has increasingly put on local budgets who rely on sales tax revenue to help fund municipal services.
Local governments have to get voter approval, and about 130 Missouri cities had done so before Tuesday. Independence officials conservatively estimated the use tax would have brought in about $1 million a year, while Blue Springs officials pegged their figure at about $400,000.
The state of Missouri already collects its 4.225 percent sales tax from online sales.
Chambers of commerce in both Independence and Blue Springs, as well as the Independence Economic Development Council, had led campaigns advocating the use tax.
Independence City Manager Zach Walker said Independence, like many other cities, already is challenged with finding new revenue sources to support the ongoing cost of basic city services. While he knew the use tax definitely was not a shoo-in for approval, it certainly would have helped the budget, and the issue still is being discussed at a national level.
“While the use tax would have helped us close a loophole and ensure the expectations of our community are met,” Walker said in a statement, “we must now turn our attention to finding solutions to optimize our limited resources and ensure our basic services are delivered in the most innovative and cost effective manner possible.
“The budget that we’re preparing, I made sure we were not basing it with this as a revenue source,” he added later.
Liberty and Belton voters also voted on use tax questions Tuesday. Liberty voters approved it 70-30 percent, while Belton voters turned it down 69-31 percent.