Byrnes Mill voters will be asked once again to approve a use tax when the April 8 election rolls around.
If passed, the measure, which requires a simple majority vote to pass, would allow the city to charge its 2.5 percent sales tax on all internet purchases, the same rate charged when people shop at brick-and-mortar businesses in the city.
Mayor Rob Kiczenski said revenue from the use tax would allow the city’s employees to join the Missouri Local Government Employees Retirement System (LAGERS) pension program.
The city already has a retirement program, but it is minimally funded compared to LAGERS, he said.
“It gives them (employees) a much better opportunity for retirement,” Kiczenski added. “It’s not going to make them millionaires by any means, but it’s something that’s fair.”
Ward 1 Alderperson Bob Prado said better retirement benefits would likely help the city recruit and retain city employees, including police officers.
“If you want people to stay, there has to be an incentive, and this is it,” he said.
Ward 3 Alderperson Nicole Pettis echoed those sentiments.
“It will make us competitive with other municipalities, and it (LAGERS) is just a better program for our (city),” she said.
Kiczenski said it’s difficult to project how much revenue the use tax would generate, but last year the city estimated it would be at least $20,000 a year and possibly more.
He said he’s heard about larger cities that have the use tax bringing in $100,000 or more a year.
Jefferson County, as well as other municipalities in the county, have asked voters to approve the use tax, and it has failed in most jurisdictions. However, Crystal City and Kimmswick were able to gain enough voter support to pass the measure.
Crystal City’s first full fiscal year with its use tax on the books ended March 31, 2024, and during that year, the city collected $317,509.11 in revenue from its internet-based sales tax.
Missourians already pay a 4.225 percent statewide sales tax on purchases made online; however, not all vendors collect it.
The internet sales tax is commonly referred to as the “Wayfair” tax, a term from a 2018 U.S. Supreme Court case, South Dakota vs. Wayfair Inc., that overturned a ruling preventing states from taxing vendors who don’t have a physical presence in that state.
Missouri residents are already obligated to pay the 4.225 percent state sales taxes on internet sales, but not all vendors collect it. Missouri residents who buy more than $2,000 in untaxed goods and services are supposed to report that on their state income tax returns.
A Missouri state law went into effect in January 2023 requiring out-of-state businesses to pay Missouri sales taxes if they had more than $100,000 in revenue during the previous calendar year. However, that law applies only to state sales tax.
Counties, cities and other entities can’t collect the sales tax on purchases made online unless a majority of voters in those jurisdictions agree to allow them to charge their sales tax on internet purchases and other out-of-state sales and receive that revenue.
In Byrnes Mill, voters have rejected the use tax four times – in the 2018, 2022, 2023 and 2024 elections. The April 2024 election saw the proposition fail with 211 no votes (about 52 percent) to 195 yes votes (about 48 percent).
Prado said he is optimistic about the use tax’s chances at the polls this time, though.
He and Pettis will head up a citizen’s committee that will be formed early next year and will work to educate residents about the tax measure.
Prado said the measure likely will be renamed Proposition P, adding that there are plans to hold voter registration events and other meetings to inform residents about the use tax before next April’s election.