Representing the Missouri Municipal League, Associate Stuart Haynes explained the intricacies of "use taxes" to Fulton City Council members this week.
City officials are putting a question on the April 3 ballot, letting voters decide on the new tax. The state already has a "use tax," as well as some other municipalities.
"About 140 cities already have use taxes, and 30 are on the ballot," he said.
This tax could contribute about $200,000 yearly to the Fulton general revenue budget. The tax is complex.
"The use tax has so many moving pieces to it, I just want to clear things up," Haynes added. "(The MML) don't take a position on that. Our task is to provide information about it."
Shoppers already pay a point-of-sale tax on items they purchase within Missouri. If one buys a backpack in Fulton, the Fulton sales tax is paid. If a Fulton resident buys the backpack in Columbia, the Columbia sales tax is paid.
"Say a Columbia person buys something from Fulton and has it shipped, within Missouri, the Fulton sales tax applies," Haynes said. "Use tax only applies to something purchased out of state that's shipped to Missouri."
Sales conducted over the telephone or over the internet also are taxed. Use tax does not apply if the purchase is from a Missouri retailer and subject to Missouri sales tax.
But if an individual buys items from an out-of-state vendor with no ties to Missouri, and over the course of the year purchases $2,000 or more, that individual is supposed to "self report" and pay the use tax if it was not collected by the vendor.
"If an out-of-state seller does not collect use taxes from the purchaser, the purchaser is responsible for remitting the use tax to Missouri," Haynes said.
For example, a common use tax transaction would be a business purchasing supplies and taxable equipment from out of state.
Haynes said the state of Missouri cannot require out-of-state companies with no direct connection to Missouri (such as a branch) to collect and remit use taxes.
In 2015, 7 percent of retail sales were conducted over the internet, and that percentage jumped to 9 percent last year. On Feb. 1, 2017, giant online retailer Amazon began collecting the Missouri use tax.
Use tax is always the same rate as local sales taxes, and local sales taxes vary. The state sales tax is 4.225 percent, with local options on top of that which are earmarked for specific purposes.
According to Haynes, municipalities such as Fulton cannot campaign, or spend public money campaigning for the use tax. All campaign materials, even if simply educational, must include "Paid For By" information including name of the entity, principal officer's name and title, and mailing address.
ELECTION INFORMATION
With a full election schedule in 2018, the secretary of state's office has a calendar of what needs doing at sos.mo.gov/elections/calendar/2018cal.
April 3 is General Municipal Election Day. The last day to register to vote is March 7. Candidate filings are now closed.
Aug. 7 is the primary election for the fall General Election. The last day to register to vote is July 11. The first day for candidate filings is Feb. 27, and the last day to file is March 27.
Nov. 6 is the General Election, in which many state and national legislative seats will be contested. The last day to register to vote in this election is Oct. 10. The first date for candidate filings is July 17 (jurisdictions in Kansas City begin July 24). The last day for candidate filing is Aug. 21.
Polling places are open 6 a.m.-7 p.m. on election day. If in line waiting to vote at 7 p.m., they have the right to cast their vote. Absentee voting begins six weeks prior to elections.
Residents can find more information about how to register to vote at: sos.mo.gov/elections/goVoteMissouri/register. Residents will need to fill out a voter registration application on that website and print and mail it in.
Also, residents can register to vote at their local elections office, including the Callaway County Clerk's office at the county courthouse, 10 E. Fifth St. in Fulton. Call 573-642-7181. Voter registration forms are also available from Department of Motor Vehicles offices and other state agencies providing services to the public.