First Posted: 1/15/2009
LUMBERTON - Some businesses are casting a leery eye at a proposal to impose an extra 1-cent sales tax to help pay for the planned Northeast Park.
Betty Evans, the treasurer of Quik Print Copy Center, said the city does not need a new tax or a new park.
“We're taxed to death now,” Evans said before adding, “What's wrong with the fields they got now?”
City officials say the $8 million, 91-acre park will help to meet Lumberton's growing recreational needs. The park would include a walking trail, soccer, baseball and softball fields, a meadow and an amphitheater.
Charlie Taylor of Taylor Engines said the new tax could hurt his business. Taylor said he is already in competition with out-of-state Internet sales, where no sales tax is charged.
“We've got to consider the parts we sell,” Taylor said. “So I have to sell a product right now at 7 percent less than my competitors mail order, just to be competitive.”
Mecklenburg is the one county in North Carolina with a general merchandise sales tax higher than 7 percent, according to Karl Knapp, director of the Tax Research Division with the state Department of Revenue.
Mecklenburg County's sales tax is 7.5 percent; Dare County has the authority to go to 8 percent, but hasn't implemented the extra 1 percent yet. Gaston County was given the green light last year by the legislature, but the increase failed during a voter referendum, Knapp said. Depending on the bill's wording, such tax requests do not have to go to voters, he said.
Knapp said he wasn't aware of any cities that have asked for an additional sales tax, though counties frequently try to increase their sales tax.
“It certainly wouldn't help (business),” Taylor said. “I understand that we need it, but I would question that. It's not about sales tax, it's about a park. Is the park going to help? Is the park justified? We've got to find out … . We might need to look at other park projects and see how they've turned out.”
Helen Locklear, a realtor and owner of Lumbee Chief Products, said the plan, which would impose the new tax on “on all sales occurring in the City of Lumberton,” is too vague.
Some sales, such as real estate or insurance, do not generally fall under the sales tax category. Even the sales tax on some grocery items differs from the basic 7 percent sales tax on general merchandise.
“I think they need to clarify exactly what they will be charging the sales tax on,” Locklear said. “It needs to be clarified, if it's added to gasoline, groceries, just what is it going to be added to?”
City Attorney Kevin Whiteheart said the tax would be mostly on point-of-sale transactions, like purchases at Lowes or Wal-Mart, and not on prepared food.
Councilman Bruce Davis said it's not a problem that the tax isn't completely defined yet.
“I think those answers will actually be determined when they bring the bill out of committee,” Davis said.
Davis said questions about how much the tax would generate will also be answered at that time.
John's Restaurant owner John McLellan says the sales tax would be a fair way to pay for the park.
“My reaction to this is positive,” McLellan said. “Everybody enjoys the park so everybody should pay.”
A number of residents said they would be willing to pay a higher sales tax if it meant a new park.
“There's not many good parks around here,” said Gregory Moore, who was at Luther Britt Park earlier this week. “Any new park would be a good thing for the people to go somewhere.”
Quentin Shipman, also enjoying an afternoon at the park, agreed. He said he goes to Britt Park frequently and brings his children there.
“We need a lot of stuff like that around here to give our young people something to do instead of going out and getting into trouble,” Shipman said.
Tammy Ratz said she'd support a sales tax, especially for a park with sports fields that would be used more by older children. She and her family were at Godwin Heights Park. Her 13-year-old daughter participates in the city's recreation softball program.
“It's probably the easiest way to raise it,” Ratz said.