Frequently Asked Questions - Q31


Question:

Well, the state certainly sets the City’s maximum sales tax rate; what effect would this amendment have on the City’s sales tax rate?

Answer:

The state legislature does set the maximum sales tax rate that the City can employ, and the City has already adopted the maximum rate allowed. Therefore, if under this amendment, the voters subsequently approved increasing the City’s overall revenues at a rate greater than the increase in inflation and population, then the increased revenues would have to come from sources other than the sales tax, as is now the case. But if projections show total revenues will exceed the cap, and if voters denied the request to increase overall revenues, then City Council would have the option of cutting any or all of its various rates, including the sales tax rate.



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