Show t Sales Tax Now Major Revenue I I y i Bountiful City received in revenue from the 2 1 of 1 per cent local option sales tax during the twelvemonth twelvemonth twelvemonth twelve twelve- month period ended February 29 1968 This fact was reported report report- ed in a special study prepared by Utah Foundation the private tax research organization THE FOUNDATION r report e p 0 r. r t points out that the local sales S tax has become a major source of revenue for many Utah counties coun- coun counties t. t ties and municipalities ties In Bountiful City sales tax receipts re receipts receipts re- re were equal to per percent percent percent cent of the property tax collections collections collections col col- for city purposes last year If It the revenue derived from the local sales tax were to be replaced by a local property property property prop prop- I erty it would require an in increased increased increased in- in I creased mills per 1000 assessed valuation I Although the local sales tax taC taxis taxis is imposed by the local units I it Is by contract actually collected collected collected col col- along with the state sales tax by the State Tax Com Com- mission The local tax then is returned after deduction of a 2 2 1 per cent service fee to the taxing jurisdiction from which it was collected FOUNDATION analysts ob observe observe observe ob- ob serve that proposals have been made in each of the past five legislative sessions to change the local sales tax law so that revenue would be distributed to all counties and cities ac acI according according ac- ac I cording to population rather i than as now on the basis of where the tax Is levied and col col- Four different attorneys general general general gen gen- eral have concluded however that such a proposal if en enacted enacted enacted en- en acted into law J would be held by Iby the courts to be Thus the opinions in indicated indicated indicated in- in that all communities now receiving local sales tax funds would stand to lose this s important revenue source if a change were to be made in the method of distribution I THE LOCAL SALES tax now lis is is imposed in more than communities located in sixteen states according to the Foundation Foundation Foundation tion report The use of the sales tax as a local revenue source has grown rapidly during recent years and most tax experts expect that this trend will continue continue continue con con- in the years ahead Recently a proposal was made by Salt Lake City to in increase increase increase in- in crease the local sales tax rate 2 1 per cent to one per cent Opposition to any hike in inthe inthe inthe the local sales tax stems mainly from the possibility that the State may again have to tap this lucrative revenue source WHEN THE 1965 Utah Legislature Legislature Legislature Legis Legis- lature switched from a pay you go to a bonding ap approach approach ap- ap to meet its capital outlay outlay outlay out out- lay needs It also transferred to general operations a 2 1 cent sales tax levy which had been earmarked for building purposes While this action in increased increased increased in- in creased the sales tax available available available avail avail- able for general operating purposes purposes purposes pur pur- poses no provision was was' made mad for the funds needed to service service service ice the debt and also provide for future state building needs Utah's total sales tax rate now is 3 2 1 per cent three per cent and 2 1 per cent local The report concludes that if any Increase is to be made in inthis inthis inthis this rate the legislature must determine where the need is most pressing pressing at at the state or orthe orthe orthe the local level I |