Information about Aug. 7, 2018, Use Tax Proposal
What is Prop U?
St. Peters residents will have an opportunity to vote on Proposition U on the August 7 ballot. Prop U would approve a “use tax” on the purchase of goods from out-of-state vendors.
What’s a local use tax?
A local use tax is a tax placed on goods purchased out of state for delivery to use in St. Peters. A purchase will never be subject to both a use tax and a sales tax. To keep things simple, the State of Missouri mandates the local use tax be applied at the same rate as the City’s sales tax, currently 2.0%
How is a use tax different from a sales tax?
Local sales tax is collected from brick and mortar retail stores.
If passed, the use tax will be applied to purchases made from out-of-state vendors that ship to St. Peters customers. Currently, out-of-state and online businesses do not collect local sales tax.
Approximately half of all Missouri cities with populations more than 2,000 already have a use tax including Wentzville, Foristell and St. Charles County.
Is this a new tax?
The State of Missouri, St. Charles County, the cities of Wentzville and Foristell and more than 100 other cities across Missouri already collect a use tax.
Currently, the local St. Peters sales tax of 2% cannot be applied to out-of-state purchases over $2,000 annually because we do not have a local use tax.
Besides St. Peters, voters in St. Charles, O’Fallon, Lake St. Louis, Cottleville, Weldon Spring and Dardenne Prairie are all being asked to vote on a use tax on August 7.
Will my taxes be going up?
In the City of St. Peters, a local 2% sales tax applies to retail purchases made in Missouri. A 2% local use tax would apply to purchases made from out-of-state vendors if you buy more than $2,000 annually. These purchases would be self-reported to the State of Missouri.
You either pay one or the other—never both.
Why is a use tax important?
Funding for basic services provided by the City of St. Peters including police and public safety, street maintenance, senior programs, parks, recreation and other amenities rely heavily on revenues from property taxes, sales taxes and franchise fees from cable and utilities.
Did you know that 42% of funding for City services including Police, Parks, Stormwater and Roads comes from sales taxes?
With the impacts of an increase in online shopping affecting our local sales tax revenue, we need to look at ways to continue funding these basic City services. The City of St. Peters has not raised property taxes since 1970. In fact, property taxes were lowered in 2007.
To continue funding day-to-day operations including police and public safety, parks, stormwater and roads, and to modernize City funding sources for basic City services, there are few options available:
- Implement a Use Tax
- Raise property taxes
- Reduce services
How will use tax revenue be spent in St. Peters?
According to the State of Missouri, the local use tax is estimated to generate $1.2 million annually.
This would allow St. Peters to help pay for:
- Police and Public Safety
- Maintain Roads and Parks
- Senior Programs and More
The Use Tax will not increase the sales tax.
Purchasers will not pay a double tax.
It’s either sales tax or use tax—never both.
VISIT THE ST. CHARLES COUNTY ELECTION AUTHORITY to learn more about the election and how to register to vote.