Activists Urge Voters In Kansas City To Vote 'Yes' On Service Tax Ban | KCUR

Activists Urge Voters In Kansas City To Vote 'Yes' On Service Tax Ban

Oct 4, 2016

Missouri voters will decide on November 8 whether to implement a ban on new sales taxes for services.
Credit Aranami - Flickr CC

On November 8,  Missouri voters will decide on a number of ballot questions, the most controversial being a photo voter ID amendment and a pair of cigarette taxes. 

But a far less attention-grabbing question is a measure that could affect sales taxes on services. 

Constitutional Amendment 4 would ban sales and use taxes on any service that was not already being taxed as of Jan. 1, 2015.

Essentially, it would ban the state and local governments alike from assessing sales taxes on services such as haircuts, day care, doctor visits and having your lawn mowed. Currently, consumers don't pay taxes on those services.

Scott Charton is spokesman for the group Missourians for Fair Taxation, which is sponsoring the amendment. Speaking on KCUR's Up To Date, he said sales taxes are regressive — meaning they're most costly for those who can least afford them. 

"So this really impacts senior citizens, disabled individuals on fixed incomes and lower income families," Charton told host Steve Kraske. 

He says there's a real threat to consumers if the amendment fails. 

Missouri politicians have proposed some version of new sales taxes on services in the last seven legislative sessions, and neighboring states Oklahoma and Illinois are also considering taxing some services. 

That concerns Charton. 

"Its the cumulative effect of sales taxes on services. Just consider the possible impacts on family budgets," he said.  

He said a 10 percent sales tax is pretty common for many areas in Kansas City. 

"So a $20 haircut jumps to $22, that affects the bottom line ... if your car breaks down, a good mechanic makes about $80 an hour and they rarely get it done in one hour so that hourly rate for the mechanic service goes to $88." 

Charton says Amendment 4 is preemptive. If it passes, the state's revenue is unaffected. 

So far, there is no formal opposition in Missouri.  However, in other states proponents of taxing services argue that increasing tax collections boosts revenues for local governments. They also say there is no reason not to tax services if a state is already taxing goods.

Lisa Rodriguez is a reporter for KCUR 89.3. Connect with her on Twitter @larodrig