MATT GOURAS Associated Press Writer
HELENA The idea of letting city and county voters institute local sales taxes is back at the Legislature again with supporters hoping this is the year it finally passes. Not likely, say veteran lawmakers and observers. One of the “local option sales tax” measures in the works this year was introduced to committee on Friday. But the chairman of the Senate Taxation Committee said he doesn’t see it getting out of his committee. If it does, said state Democratic state Sen. Jim Elliott, it will likely get killed in the House, which is controlled by Republicans. State Sen. Sam Kitzenberg, Dglasgow, remained undaunted as he pitched his local sales tax bill to the panel Friday morning. “What I’d like to see is an open mind on this optional tax,” he said. Cities and counties argue that a local sales tax could be used to lower property taxes. It would also let them shift some of the tax burden to tourists. They also point to the success of the sales tax currently allowed in resort areas, such as Whitefish, where property taxes have been lowered by as much as 25 percent. In those areas, voters have overwhelmingly endorsed the special tax. “We’ve been promoting bills like this for 25 years,” Alec Hansen, executive director of the Montana League of Cities and Towns, told the tax committee. “I could probably give this testimony in my sleep.” City managers and mayors pointed out that they will only be able to implement the tax if local voters want it. But critics say it would create a “crazy quilt” of sales taxes across the state. A city could charge one rate on certain items, while the surrounding county could charge a different rate and tax completely different items. Rural residents largely oppose it because they shop in cities and don’t want to pay a tax that they don’t believe benefits them. Mary Whittinghill, president of the Montana Taxpayer Association, has opposed the idea for years. She isn’t too worried about it getting passed this year. “I don’t think it will go,” she said. Local sales tax supporters met with Gov. Brian Schweitzer earlier this month, and were pleased to hear he would not oppose the local sales tax. But he warned them of a harsh political reality: The local sales tax has staunch critics in the Legislature. The state Senate has supported a local option sales tax in the past, but it has died in the House. Elliott said he first served on a subcommittee charged with analyzing the local sales tax issue in 1989. And he believes it is bad tax policy for the state to adopt. The veteran lawmaker said he won’t create a subcommittee to hash out the issue as supporters want this year. Instead, he will bring it up for executive action in his committee, and then add some amendments wanted by different groups. After that? “We’ll kill it,” he said. Kitzenberg’s bill is 275.
