Minutes 04/09/1968 - Laserfiche WebLink

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2~~ TUESDAY APRIL 9. 1968 On behalf of the Board of Directors of the Virginia Recreation & Park Society, Mayor Renick and Council presented to Mr. Dudley Smith an award and plaque in recognition of Mr. Smith's outstanding volunteer services--both in time and in providing recreational facilities--to the City's recreational program during the past several years. City Manager Noland, as Chairman of the Special Tax Study Committee, presented the following report and recommendations of the Tax Study Committee, with Council placing on first reading a resolution--suggested by the State Department of Taxation--providing for the enacting of a 1% local Use tax, effective July 1, 1968, under enabling legislation adopted by the 1968 Virginia General Assembly: 1. Take advantage of enabling legislation recently affected by the State, which allows localities to impose a one per cent local use tax, a tax which would apply only to tangible personal property brought or ~3hipped into Virginia from other states. The State Tax Commissioner says such an enactment would prevent oLJ.t-of-state dealers from con- tinuing the competitive advantage they now have over Virginia dealers. The State has not informed us of the estimated amount of revenue this plan would provide the City, but the State estimates that this new source, coupled with anticipated normal sales tax growth, would mean about $161,000 of additional revenue to the City during the next fi:3cal year. But to have the legislation become effective on July 1, the resolution dra~~ by the State, and submitted herewith, must be adopted in the month of April. 2. As the second most equitable source of additional revenue, your committee suggests the revamping of the present tax on electric utilities, to broaden its base and secure more revenue than the present ordinance produces, and also place a tax on natural gas and telephone bills. A specific rate or utility tax structure is not suggested at this time, bxt the committee will continue to work on this possibility, and will suggest a rate structure as soon as one can be developed. 3. Third in preference as an additional source is some adaptation of the Consultant's suggestion as to upward revision of license and/or gross receipts taxes. On the other side of the situation, it is recommended that the City's li2ense ordinance be amended to exempt in-city contractors from gross receipts taxes on the construction of homes outside the City, this being a suggestion contained in the Consultant's report.