The Joplin Globe, Joplin, MO

Local News

April 14, 2013

Susan Redden: Lawmakers reinstate car sales tax assessments

Sales tax proceeds on vehicles bought out of state should soon be returning to the coffers of some local governments.

A bill reinstating the tax has been passed by Missouri lawmakers and is on the desk of Gov. Jay Nixon.

Sen. Ron Richard, R-Joplin, said the bill was passed with an emergency clause by both chambers.

“It gives him 15 days to sign it, and it goes into effect then if he hasn’t signed it by that time,” said Richard, who is Senate majority floor leader.

An earlier bill aimed at reinstating the tax was vetoed by Nixon, but Richard said the new version removes elements the governor had found objectionable.

“That one would have imposed the tax retroactively,” he said. “We took that out, and we put in more stringent guidelines on counties and cities.”

The Missouri Supreme Court a year ago ruled that cities and counties could not collect sales tax on out-of-state vehicle purchases unless they also collect a local use tax. The Missouri Department of Revenue at the time estimated revenues lost as a result of the ruling at $431,000 per year for the city of Joplin, $74,500 for Webb City, $69,500 for Neosho, $63,000 for Carthage, $354,000 for Jasper County and $177,000 for Newton County.

The bill before the governor allows sales tax to be collected on vehicles purchased out of state, with the money going to governmental entitles based on the address of the buyer. But local governments must, by November 2016, seek voter approval of a local use tax. The measure also contains provisions for repeal of the tax.

Local government officials across the state asked lawmakers to find a way to reinstate the sales tax, after it was overturned by the Supreme Court. Some said the impact on local governments was greater because it was easier for residents to cross state lines and avoid the tax.

“The tax was collected for years,” said Rep. Tom Flanigan, R-Carthage. “All we’ve tried to do is reinstate what was there.”

He said he reviewed the measure Friday in a meeting of Southwest Missouri county commissioners held in Carthage.

“They’re relieved, and counting on those revenues coming back,” he said.

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