| Some Constitutional reformers claim that the Alabama Constitution
prohibits citizens from increasing local taxes. How can they make this outlandish claim? Following is sales tax
differences though out Alabama. Support
Citizens for Responsible Constitution Reform. Sales tax: How much does a half-cent hurt? By ANGIE DROBNIC Business Reporter A half-cent increase in the county sales tax might not seem like much, but it would give more Mobile County municipalities some of the state's highest sales tax rates. Today, sales taxes in Mobile County are the highest in Prichard at 10 percent. Mobile, Chickasaw and Mount Vernon are tied for second place with 9 percent. If the tax passes, Chickasaw and Mount Vernon will overtake Mobile with 9.5 percent. Bayou la Batre will rise to 9 percent. The other municipalities - Citronelle, Creola, Dauphin Island, Saraland and Satsuma - will rise to 8.5 percent or below. Voters outside the city limits of Mobile and Prichard can opt to raise sales taxes by a half percent, or a half cent on the dollar, in the May 15 school tax referendum. Sales taxes in Mobile and Prichard would be unaffected. The tax was set up that way because legislators who drafted the ballot measure said county residents would only approve a measure that included sales taxes. Other legislators refused to accept any potential for a sales tax increase in Mobile and Prichard, so the sales tax exempts the two largest cities in the county. "It's hard to administer something like that. It's confusing," said Marshall Howell, an examiner in the state Department of Revenue's sales and use tax division. Howell analyzed the 200 largest municipalities in Alabama for the Mobile Register to find out which ones had the highest sales taxes. He found that only the north Alabama city of Arab has a higher sales tax than Prichard. The part of Arab that is in Cullman County has a tax rate of 11 percent, the highest in the state and no doubt among the highest in the nation, Howell said. About 24 cities and towns, including Mobile, have sales tax of 9 percent, Howell said. Most of the towns in Alabama have sales tax of about 8 percent, he said. Chickasaw Mayor Jim Trout said he won't be happy if the rate there goes to 9.5 percent, but the city doesn't have much retail business anyway since it lost its Delchamps last year. "The grocery store was the largest sales-tax producer. We're still hoping and working to get another grocery store in there," he said. Fast-food restaurants and a florist are the largest sales tax remitters in the city, he said. But the half-cent increase would decrease the difference between sales tax rates in the city of Mobile, its police jurisdiction and the unincorporated area. The rise would bring the rate to 7.5 percent in the police jurisdiction and 5.5 percent in the unincorporated area, compared with 9 percent in the city of Mobile. The Mobile Area Chamber of Commerce would like to see sales tax rates be more equitable across the county, said Jim Apple, vice president of economic development. "It's not so much high sales tax, as a sales tax disadvantage that makes it difficult for a small business to compete," he said. "It's more the difference, the uneven playing field, than it is the amount." But many business owners in the area near the city's border say another half-cent of sales tax in the county would affect their businesses very little, if at all. Marcy Stipp, a spokeswoman for Birmingham-based grocery chain Bruno's, said the company doesn't actively track sales tax rates to determine marketing strategies. "Primarily, people base their grocery shopping decisions on convenience and the quality and variety of products in the store, as well as the customer service they receive there," said Stipp. "As to whether people drive to another store for a lesser tax rate, I couldn't even begin to tell you." Dianne Safiran, owner of Chelsea's Imports & Gifts in the police jurisdiction on Schillinger Road, said she's not worried about the possibility of a half-cent increase in sales tax. "I don't think it's going to affect the people who have money to go out and shop," said Safiran. Safiran said her concern with the measure as a small business owner is that she might have to fill out more complicated forms: "It does take up a lot of time, and you have to keep services separate." County authorities said they don't yet know who will collect the tax and they probably won't make the decision, if needed, until after the election is over. © Mobile Register |
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