Sales tax debate: helping or harming? - KWWL - Eastern Iowa Breaking News, Weather, Closings

Sales tax debate: helping or harming?

by Jason Epner

CEDAR RAPIDS (KWWL) -- People in Cedar Rapids turned out in large numbers to voice their support Friday for the upcoming vote on a one percent local option sales tax.

If passed, the tax will generate in upwards of $29 million annually, and supporters say this is the route Cedar Rapids nees to go.

"The city only has 2 options: sales tax, or property tax," said Gary Ficken.  "Sales tax spreads the burdon."

But this tax has far-reaching effects beyond the boundaries of Cedar Rapids

For more than five years the city of Coggon has had a local option sales tax.  Coggon Mayor Robert Kurt worries if Cedar Rapids passes the tax, it will hurt small communities like his.

"We stand to lose about 75 percent of the revenue that we're currently getting," said Kurt.

That means infrastructure projects that are ready to go could be slowed down significantly

The local-option sales tax works like this:
--The tax money raised by each participating Linn county town is pooled into one fund.
--The money is then distributed back to the participating cities based on a number of factors including population and property taxes.
--If Cedar Rapids passes the tax, the city will take a bigger portion of the pie leaving less for other communities.

"I personally feel bad for the citizens that have gone through this in Cedar Rapids," said Kurt.  "Understand that it really does affect a lot of other local communities that are doing good things with this option sales tax money."

Those living in Cedar Rapids will vote on the tax on March 3rd.  If approved, the tax would go into effect on April 1st.

Online Reporter:  Jason Epner

Online Producer:  Dani Blecha

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