It has been an interesting couple of months if you’ve been following the multiple councils/commissions of Eureka Springs. This week a local businessman, Ken Foggo, spoke to City Council in opposition to the proposed two percent retail sales tax increase.
Getting to work here at the Independent I have been getting a front row seat to two of the major ideals that drive how Eureka Springs operates.
The first ideal is the idea of staying the way you are and attempting to keep the revenue of Eureka Springs the same and attempting to lessen risk while reward is lessened, also. The second ideal is increasing risk for increase of reward. The tax would increase revenue coming into the city per unit of bought “item(s)” within the town, but it risks hurting businesses within town and driving customers away from the city, and Foggo argues that point.
During the meeting, Foggo compared sales tax rates of Eureka Springs to Berryville, Springdale, Rogers, Hot Springs, Little Rock, and Huntsville. He said if Eureka adds 2 more percent the city tax would be 2-3 times higher than other cities. But would it? Incoming math! Take cover!
Okay, maybe not that much math. If you break down the taxes within those cities the city of Eureka Springs takes out for itself about 75% more than those cities, and Foggo is right in saying that the addition of 2% tax taken out by the city would be 2-3 times more than most cities.
What about overall?
We will use the two biggest tourist towns nearby and the ones that the city of Eureka Springs has been compared to throughout the years, Branson and Hot Springs. The total retail sales tax in Eureka Springs is 9.375 % with exception for grocery sales, which don’t have the full State sales tax. With the addition of the two percent increase total retail sales tax will increase to 11.375%.
With the help of Google and the City of Branson’s website I found that the general retail sales tax within the city is 8.6% with the Branson Hills District being 9.1% and the Branson Landing District at 9.6%. Hot Springs on the other hand has anywhere between 8.5% – 9.5% retail sales tax depending on your zip code within the city.
Our city’s total retail sales tax now is in line with our city’s two biggest competitors and there are those who argue that it is too much already!? Now what about Rogers and Berryville? Little Rock and Harrison? Let’s take them in order. Rogers – 9.5%, Berryville – 9%, Little Rock – 9%, Harrison 9%. The City of Eureka Springs is not that much higher or lower than any other of these cities. Adding 2% to what the city of Eureka Springs takes for retail sales tax isn’t going to be that detrimental to our tourists. Out of $1 it will be twelve cents from 9 cents. Out of $100 it will be $12 instead of $9.
For the assurance of my water not containing dangerous amounts of lead, the assurance that our Auditorium is not going to fall out from under us, let the sales tax increase. In the end it is not that much more than what is already there and not that much more than what is everywhere else.
I say take the increase in tax and open up to it. It’s not going to be that detrimental and if the tax results in a huge amount of added dollars, then by the power of math the cost of the item(s) added up to be a lot of money in the first place. Expect the tax to reflect that.
This has been Jeremiah Alvarado, wishing all of you a wonderful week.
Jeremiah Alvarado