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News
Mayor wants to give half in sales taxes back
By Eric Carpenter, Orange County Register
January 28, 2010
Anaheim, CA, Mayor Curt Pringle is proposing a plan to refund half of the city's sales tax revenues on large purchases back to customers for a limited time, with the hope of providing a shot in the arm to the local economy.
On any purchase of $20,000 or more, half of the city's share of the sales tax would be rebated to the customer.
The city receives 1 percent in sales tax. So on a purchase of $20,000, a customer would get $100 back. On a purchase of $100,000, the customer would get back $500.
"I realize that $20,000 or greater in purchasing is a big amount," Pringle said. "For a consumer, we're talking about a car, appliances for the home or maybe a whole new set of furniture.
"But for business-to-business purchases, $20,000 and larger transactions are more common," he added.
Pringle announced his plan during his annual State of the City luncheon on Tuesday. He is proposing that the rebate run from a limited time, from February through June.
Pringle said he thinks the city should be willing to forego some of its sales-tax revenue for that limited time "to encourage people and businesses to shop here in Anaheim, spurring Anaheim retailers and creating jobs here in our city."
Todd Ament, president and CEO of Anaheim's Chamber of Commerce, said he believes the plan would provide a spark.
"We would hope that businesses considering whether to make large purchases later in the year would be encouraged to do it earlier in the year," Ament said. "And we think it may make people from other cities look at doing business in Anaheim."
Ament said that, if the plan is approved, the chamber would work with the city to market the idea.
No detailed economic impact study was performed but supporters of the plan say that city coffers wouldn't suffer – the theory being that more large purchases will be made during that time, making up for any loss in revenues, Ament said.
Pringle's proposal would need the approval of at least three of the five City Council members.
The item wasn't included on this week's agenda, but Councilman Bob Hernandez indicated during the meeting that he "looks forward to supporting" the idea when it does come before the council.
The plan likely will be considered at the next council meeting, scheduled for Feb. 9.