Downtown sales tax will not apply to vehicles purchased elsewhere

Wednesday, November 9, 2011 | 6:54 p.m. CST; updated 8:44 p.m. CST, Thursday, November 10, 2011

This story has been rewritten to correct the premise of the original article, which reported that the half-cent sales tax in the Downtown Community Improvement District would apply when district residents buy vehicles, regardless of where the vehicle purchases take place. The original story was based on information from the Missouri Department of Revenue and a district board member. Revenue department spokesman Ted Farnen corrected the mistake on Thursday.

COLUMBIA — It turns out that the half-cent sales tax voters approved for the Downtown Community Improvement District will not apply to vehicles that downtown residents buy outside The District's boundaries.  

Ted Farnen, spokesman for the Missouri Department of Revenue, told the Missourian in a report on Wednesday that the sales tax would apply when residents of the improvement district buy vehicles, regardless of where they buy them. After further checking on Thursday, he discovered that was wrong.

"What I told you yesterday about motor vehicle sales taxes and how they are applied, was generally true," Farnen said in an email to the Missourian on Thursday. "However, I did not know about a special exemption for motor vehicle sales that is included in the Community Improvement District language in the state statutes."

Farnen said the language is part of Section 67.1545 of state statutes.

"Even though the motor vehicle sales tax rate is assessed at the rate of where a person lives, and not the point of sale, the extra one-half of 1 percent recently approved in the Downtown CID will not apply to motor vehicle purchases made by people who live within The District," Farnen said. "I apologize if the information I gave you yesterday caused any inconvenience."

Community Improvement District Director Carrie Gartner alerted the Missourian to the error Thursday morning, prompting a call and an email to Farnen seeking clarification.

District board member Skip Walther also said Wednesday that he believed, after some research of his own, that the tax would apply to residents' vehicle purchases.

District residents voted 25-15 in favor of the tax in an election by mail that ended Tuesday night. The tax will apply to all retail purchases within The District's boundaries beginning April 1.

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Dan Gier November 10, 2011 | 1:32 a.m.

Big Whoops,

According to my accountant since my business has a downtown address, yes it is in the district, My business vehicles that are registered to this address are also subject to the "new" tax.... I think you will find several if not 100+ vehicles fit into this whoops!!!!!

(Report Comment)
Richard Saunders November 10, 2011 | 10:17 a.m.

There is no escaping the Law of Unintended Consequences!

(Report Comment)
Steven Rich November 10, 2011 | 10:43 a.m.

Thanks to a comment on a previous story by John Schultz we got this story. If you ever have questions, feel free to ask. We'll do our best to find the answers.

Steven Rich
Reporter, Columbia Missourian

(Report Comment)
Jeremy Calton November 10, 2011 | 11:20 a.m.

"We didn't consider the impact of that law"

Ladies and gentlemen, I give you...government.

(Report Comment)
Jeremy Calton November 10, 2011 | 11:29 a.m.

Also, gotta love that "democracy" means 25 people decide whether 100,000 people will be subject to a tax. I guess at least it's better than the smoking ban, which was decided by FOUR people.

Obviously, the 25 people who voted Yes deserve to pay this tax.

(Report Comment)
Hank York November 10, 2011 | 11:39 a.m.

As a "liberal," my favorite part of the tax is that they don't even know what they are going to do with it. I've never seen anything like that. My second favorite part is how twenty five people of a pool of around one hundred voters decided the tax rates paid by a couple hundred thousand people. My third favorite part is how the defenders of that state that people have a choice whether or not to pay it, as if most of the businesses operating in downtown are also located elsewhere.

(Report Comment)
Kassia Reynard November 10, 2011 | 3:25 p.m.

I saw that they were supposed to use the tax money for more street musicians. Street musicians???? What is this, Paris all of a sudden? Next thing you know, mimes are going to come up to you and start bothering you while you are eating at your favorite sidewalk cafe (which looks fine as it is, quite frankly). MIMES. I kid you not, people. MIMES. That's what you're gonna wind up with.
(...Note to self...teach goat to sing so we can cash in on this deal...)

(Report Comment)
Michael Williams November 11, 2011 | 8:57 a.m.

I don't understand the gripe that only 25 people determined what taxes the rest of us pay when we shop downtown.

Columbians have done this to surrounding areas many times. We vote for city-wide taxes, knowing that folks from outside this area will be paying the tax when they visit.

And we do it quite merrily.......

What's the difference?

(Report Comment)

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