From the Indianapolis Star:
Eight years ago, Bill Smythe fought a proposed 1 percent tax that would have been added to burgers and beers served at his tavern, Claude & Annie’s.
He is again questioning the merits of a new effort to tax food and beverages in Fishers. The proposed tax is back, served up by the Indiana General Assembly and facing the community a year before it transitions into a city.
Smythe isn’t alone. A small but vocal group of residents have spoken out on community blogs and at two public hearings, where they questioned how revenue from the tax would be used.
On Monday, the council plans to vote on whether to OK the tax. If approved, restaurant and bar tabs would be taxed at a rate of 9 percent in Fishers. That includes the state’s 7 percent sales tax and a 1 percent county tax passed earlier. The new tax would generate an estimated $1 million in 2014.
Smythe said his objections are based in principle and practice. He estimates a loss between $7,500 and $10,000 in sales at Claude & Annie’s if the tax is passed and he does not raise prices.
“One: Raising taxes generally dissuades commerce,” Smythe said. “And two: This tax is specifically targeted at one industry alone — ours — and not shared equally by the business community that is supposed to benefit from the ‘economic development’ yet unspecified.”
John Weingardt, Town Council president, said he has received little community feedback about the tax compared to other issues, such as a rejected plan for a single contractor to collect residential trash. He won’t offer how he’ll vote but says the tax, if approved, would be a “win” for the community. The legislature limits the tax dollars’ use — for economic development purposes and to reduce the property tax levy — and the community could weigh in on how it is divided, he said.
If $1 million reduced property tax bills, homeowners could see an average $30 reduction, he said. Or the tax could go toward an economic development fund. Weingardt said if a “game-changer” project was offered to the city, there would be money available.
Last week, council member Scott Faultless said approval of the tax could be a make-or-break vote for an unnamed $100 million project. Weingardt said a number of projects are in the works, but, “I don’t feel comfortable laying out what this deal would be.”
The food and beverage tax debate goes back to 2005. That’s when Hamilton County, along with surrounding counties, agreed to help fund Lucas Oil Stadium by adopting a 1 percent food and beverage tax. State lawmakers allowed communities such as Fishers, Carmel, Noblesville and Westfield to approve another 1 percent dining tax to generate an additional bucket of revenue. Fishers rejected the additional tax. but it was adopted in the other communities.
The legislature passed a bill earlier this year giving Fishers until Dec. 31 to approve the tax.
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http://www.indystar.com/story/news/local/hamilton-county/2013/11/30/fishers-votes-monday-on-food-beverage-tax/3796107/
