By Alex Foltz
On March 6, the citizens of Muscatine will be asked to vote on a 1% local option sales and service tax. This tax, if approved, would provide approximately $2.7 million to the City of Muscatine annually. This money would not be used for property tax relief. No less than 80 percent of the revenue would be used for sanitary and storm sewer projects, and up to 20 percent could be used for the Pavement Management Program.
The language on the ballot will be as follows, according to the City of Muscatine website: “Shall the local sales and service tax be continued in the City of Muscatine at the rate of 1% to be effective July 1, 2019, until June 30, 2034? Revenues from the sales and service tax are to be allocated as follows: Not less than 80% for sanitary and storm sewer projects including principal and interest payments on debt issued for these projects; up to 20% for the Pavement Management Program; and 0% to property tax relief.”
The local option sales and service tax, if approved, would affect only the incorporated areas, as well as the unincorporated areas of Muscatine County where the majority vote is in favor of the tax. This tax is common in Iowa communities, with 1,277 of the 1,373 communities in Iowa already having this tax in place. That is around 93% of the communities in Iowa.
The full list of the taxable services and products is available on the Iowa Department of Revenue website. A quick rundown of the taxable services and products, according to the City of Muscatine website, are as follows: point of delivery retail services, with the exception of items such as groceries, gas and prescription drugs.
As stated in the wording of the ballot, this continuation of the local option sales and service tax would become effective July 1, 2019.