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 Meals Tax up for discussion...

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Dave
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PostMeals Tax up for discussion...

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By George Morse- Seekonk Star

SEEKONK - It could bring in more than $400,000 a year but a few town officials aren’t quite sure a local option meals tax is right for Seekonk and its many restaurants.

At a Seekonk Board of Selectmen meeting in July, Town Administrator Michael Carroll provided estimates from the Massachusetts Department of Revenue (DOR) on how much the town could gain by implementing a meals tax, which would add an additional 2 percent tax to restaurant bills. Of this 2 percent, 1.25 percent would remain with the state while .75 percent would be returned to Seekonk.

The option of assessing this tax was left up to individual cities and towns by the state legislature and was put into place last month.

According to the DOR estimates, Seekonk could receive about $418,000 a year if a local option meals tax was approved by a town meeting vote. Also, the town could receive a $66,000 bump in revenue by choosing to increase a hotel room tax from 4 to 6 percent, also a local option.

In the current fiscal year, local aid coming to Seekonk from the state was cut by more than $500,000. Despite the meals tax estimated ability to compensate for this, the majority of selectmen didn’t seem on board with the proposal.

Selectman Michael Brady said he was “incensed” that the collection of meals tax funds would be handled by DOR. Mr. Brady argued that if the meals tax is a local option, the town should be able to collect the money itself.

“I don’t trust the state at all,” Mr. Brady said. “If they get the money in their coffers, I don’t trust they’ll give it back to us.”

Chairman Francis Cavaco agreed.

“Of course you’re not going to see that money,” he said.

As a way to first see how the state handles distribution of meals tax funds, selectman Robert Richardson proposed putting off a town meeting vote on the issue until the annual spring town meeting in 2010.

“We should wait and see what happens,” Mr. Richardson said.

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Still, selectman David Parker argued that delaying a vote on the issue could cost the town money.

“I don’t care if the estimate is five bucks. It’s more than I have now. Why would you delay bringing money in?” Mr. Parker said.

On the menu

Local restaurant owners gave mixed opinions on what the tax could do to business.

Peter Delis, owner of Toti’s Grilled Pizzeria, said he is against any new taxes. When asked if he thought it would affect business, Mr. Delis’ answered succinctly.

“Of course,” he said.

On Fall River Avenue, Mary Beth DeLeo’s Breakfast House owner Mary Beth DeLeo said she too isn’t in favor of additional taxes. Even without the meals tax, Ms. DeLeo said her business heard a couple complaints this weekend when the state sales tax was bumped from 5 percent to 6.25 percent.

At the Seekonk Pizza Factory, however, owner and operator Scott St. Pierre said he’s not afraid of the town potentially adopting the meals tax.

“It’s an extra couple bucks here and there,” Mr. St. Pierre said. “The average person spends about 15 bucks. It’s an extra 20 cents.”

Mr. St. Pierre added that even if a meals tax were to be put in place, Seekonk would still be competitive with nearby East Providence and Providence where sales and meals tax add up to 8 percent.

The earliest this tax could be imposed would be Oct. 1 if a town meeting vote approved the measure by Aug. 31. As of this publication, no town meeting vote on a meals tax has been scheduled.
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Meals Tax up for discussion... :: Comments

Re: Meals Tax up for discussion...
Post on Thu Aug 06, 2009 7:47 pm  seek2mend
I have very strong feelings about this. IMO, the issue is not whether the state can be trusted to get the funds to Seekonk. The real issue is whether the state will adjust state aid based on the ability of a town to further screw business.

Seekonk is already a boon to the state. The businesses are a boon to Seekonk. For anyone who is unaware of our local property tax structure, here is a quick lesson. Residents pay $9.64 per thousand and commercial pays $20.04. If it were not for our commercial base, our residential taxes would be MUCH higher if we wished to maintain the same level of services.

To the credit of the businesses in town, I do not hear them whine and complain about their property taxes as they have done in Attleboro. So if we can continue along without targeting our business partners, I think we will be a stronger community for it.
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Re: Meals Tax up for discussion...
Post on Wed Aug 12, 2009 2:44 pm  mkreyssig
To be fair seek, businesses are always a target, no more than tax payers. Every time the state raises the sales tax, or applies the sin tax to a new item they are targeting business, and with the latter specific industries.

Assuming we actually get the .75 % of the tax I would be for it if and only if the money went to pay for infastructure, and not to the schools in the 65/35 fashion.

A good chunk of those businesses on RT 6 carry liquor licenses and have large amount of patron from out of state or out of town, that subsequently cause more of a drain on our emergency services. Furthermore the traffic load on RT 6 is horrible, particularly on the weekends, and neither fall River ave, or County Street were designed for that amount of travel. So I would be perfectly willing to spend .2 cents for every dollar to help fund our infastructure. And it's not like someone is forcing me to pay that tax and it's one tax I don't mind. It's not targeting anything I have to have to survive. Going out doesn't really affect my quality of life. If I don't want to pay the tax I either don't go out to eat, or take the time to drive to a town that does not have that tax. But since I believe RI already has higher taxes, and Rehoboth does not have any restaurants, and anything Swansea may have will cost me far more in gas to get to; I doubt that will happen.

I also don't think many people will put that much thought into it.
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Re: Meals Tax up for discussion...
Post on Tue Aug 25, 2009 10:24 pm  Dave
Quote :
FOXBORO - Foxboro on Monday night became the first community in eastern Massachusetts to say no to a local option meals tax.

Residents at a hastily called special town meeting voted 45 in favor, 85 against adding 0.75 percent to the 6.25 percent sales tax at restaurants.

"This is one time that I don't feel Foxboro should be the leader for surrounding towns," said Selectwoman Lynda Walsh, successfully opposing the proposed local meals tax increase.

Voters agreed, however, to add 2 percent to the hotel and motel excise tax the town collects. Increasing the rooms tax from 4 percent to 6 percent will bring in an estimated $231,000 in new local revenue per year. The vote on the room occupancy tax - close enough to require a hand count - was 90 in favor, 73 against.

The failed meals tax increase would have meant an estimated $458,000 annual boost to the town, according to calculations based on the state Department of Revenue's figures. Selectmen Paul Feeney, Lorraine Brue and Paul Mortenson and other residents argued the town needs the money for police, fire and other services.

Opponents of the meals tax argued the tax would hurt businesses in Foxboro in a down economy, reduce tips to restaurant employees, and said asking for money without citing a specific need is poor policy.

Chris Dunn, owner of Primo's sandwich shop on Mechanic Street, noted the sales tax recently went up from 5 percent to 6.25 percent. He said another hike will be one more reason for a customer to pass on the idea of buying a meal out, and that every lost sale matters to struggling small businesses.

Advisory committee member John Gray said it's wrong to add a local tax with no specified purpose.

"To me it's almost on the edge of stealing," Gray said.

But Feeney said the correct procedure is for a future town meeting to decide how money is spent.

In all, 177 registered voters came out to have their say on the three-article warrant.

The final article, to pay a $4,447 debt to Town Counsel Deutsch Williams was approved, without debate, by a vote of 150 to 10.

More than 20 Massachusetts towns and cities have accepted either or both local option taxes, John Robertson, deputy legislative director for the Massachusetts Municipal Association, said Monday.

Among the communities to say yes were Amherst, Bedford, Braintree, Cambridge, Chelmsford, Melrose, Raynham, Springfield, Winthrop and Worcester. Greenfield's council earlier rejected the meals tax, and its mayor on Monday vetoed the lodging tax.

Foxboro selectmen scheduled the unusual summer town meeting to give the town the chance to capture as much of the new revenue as possible in the current fiscal year.

Last week, after hearing opposition from the Tri-Town Chamber of Commerce and from Lafayette House restaurant owner Ron Young, the advisory committee voted 8 to 4 to urge town meeting to oppose the local option meals excise tax. The committee split 6 to 6 on the lodging tax.

The town can revisit the tax questions at a future town meeting.
 

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