BY MELANIE WADE –
Although 2017 sales tax collections for Polk County are still more than $9,000 below collections this same time in 2016, monthly collections were up for the third month in a row.
For the month of July 2017, the 1-cent sales tax collections were $126,808.33, up by $4,309.12 from July 2016, an increase of 3.5%. The 1-cent road improvement tax reflects the same figures. The total collected for 2017 so far is $835,522.08, a 1.1% decrease from the same period last year when $844,953.58 was collected.
The year has seen several months of negative collections when compared to the same time last year, however, it is consistent with a yearly trend, causing little concern for county officials, at this time. With internet sales suspected for a portion of the decline in revenues, officials remain hopeful that reinforcing the importance of shopping local as well as pending legislation that would impose sales tax on internet sales will both help change/correct the declining trend.
In an interview in January, Polk County Judge Brandon Ellison gave his thoughts on the decrease in collections over the last several years. “I think internet sales have something to do with it. It hurts local businesses and rural counties because we don’t have the services that are available online. Delivery trucks and 18-wheeler traffic bringing things in have tripled in the last few years. It’s a little discouraging that our taxes aren’t growing like they should, especially with the increased traffic.”
At that time Ellison also stated, “We encourage people to spend money at home. internet sales are not taxed. It has certainly taken off and people buy a lot of stuff online and it’s really unfair to brick and mortar businesses at the local level. They’ve taken the risk and made the investment and they are having to collect state, county, and local taxes while the internet sales don’t. I think it is probably affecting more rural Arkansas counties also.”
Mena City Council passed Resolution 1339 on July 11, 2017 that supports proposed federal and state legislation to insure the proper assessment and collection of sales tax from all internet and online sales, no matter where that business is located. The Arkansas Municipal League asked each city in the state to pass a similar resolution and to send it to Arkansas Governor Asa Hutchinson to encourage him to call a special session for legislators to vote on the matter. Amazon.com is ahead of the game when it comes to the concept. The large online retailer made it their own policy to begin collecting local and state sales taxes. Mena received their first payment from Amazon in May. Although it is not yet a significant number, legislation could increase it drastically if tax dollars are submitted from more online retailers.
Amid big-box retailers and the convenience of ordering online, many rural communities have felt the crunch, whether directly as a storeowner, or indirectly as a citizen of a town whose sales tax collections continue to decline. Shopping locally has long been the staple of many small communities, and recently there has been a popular movement to go back to the roots of local shopping as communities try to revive their economies.
Not only does shopping locally revive an area’s economy, there are many more benefits as well. Shopping locally provides a personalized experience that is often unique. Providing jobs to locals, who in turn spend their money locally, keeps a larger share of tax dollars in the area. And, according to the Institute for Local Self-Reliance, “In an increasingly homogenized world, communities that preserve their one-of-a-kind businesses and distinctive character have an economic advantage.”