Montana Lawmakers Consider Local Option Sales Tax Bill
Montana lawmakers will once again consider a bill that would allow for a local option sales tax. It’s a policy that’s been seen and rejected in past years at the state Legislature, amid a long-running debate over how to make the most of tourism dollars and tax locals fairly.
Rep. Dave Fern, a Democrat from Whitefish, is sponsoring House Bill 187, and admitted he doesn’t think it’ll get much support this year. However, he lives in a town with a local resort tax and thinks it’s a good model to ease the burden of other taxes.
"And I think such a model should be available to other willing cities, towns and districts."
Only towns or areas that are classified by the state as a "resort" can ask their voters to create a local sales tax of up to 3% on some goods. Fern’s bill would allow any municipality or county to put to voters the question of whether or not to have a local option sales tax up to 2% on a much broader range of goods.
Daryll James with the Montana Infrastructure Coalition spoke in support.
"Montana’s property taxpayers are crying out for relief. We have a growing number of visitors to our state that have an undeniable impact on our services and infrastructure provided by our local communities and we simply need to diversify our tax base," James said.
City council members from Missoula and Billings also support the bill.
SJ Howell with Montana Women Vote spoke in opposition.
"Despite a goal of capturing tourism dollars, a local option sales tax will inevitably impact local residents both in the municipalities and those who live nearby."
The Montana Budget and Policy Center and Montana Taxpayers Association also opposed the bill.
Lawmakers on both sides of the aisle have been pushing for tax reform in Montana, although a similar local option sales tax bill was tabled last session. Republican Gov. Greg Gianfortehas proposed his own ideas that include cutting income taxes for the state’s top earners and business-related taxes. Democrats have released their own slate of tax change proposals, too.