City of Maryville

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Use Tax - April 2, 2019

Voter Information

Ballot Question:

"Shall the City of Maryville impose a local use tax at the same rate as the total sales tax rate, currently 2.375%, provided that if the local sales tax rate is reduced or raised by voter approval, the local use tax rate shall also be reduced by the same action? A use tax return shall not be required to be filed by persons whose purchases from out-of-state vendors do not in total exceed two thousand dollars in any calendar year."

What is a Use Tax?
A use tax allows for the local sales tax rate to be applied to purchases of goods by Missouri residents and businesses from out-of-state vendors. This typically includes online purchases, catalog, and direct market sales from out-of-state vendors. The use tax applies to out-of-state purchases where no sales tax is currently charged. A use tax does not apply if the purchase is from a Missouri retailer and is already subject to the local sales tax. 

Frequently Asked Questions:
  • I already pay sales tax, is this a double tax?
    • Use tax is not a "double tax" and only one or the other is applied based on the vendors location. Currently, the local sales tax rate of 2.375% applies to local purchases. No local sales tax is being charged to purchases from online out-of-state vendors. 
  • Are there exemptions?
    • Items that are exempt from sales tax are also exempt from use tax.
    • Items that are purchased for resale are exempt from use tax.
    • Online out-of-state vendor purchases not exceeding $2,000 cumulative on a year basis are exempt.  
  • Why are the State of Missouri and Nodaway County already charging sales tax on online out-of-state purchases?
    • Nodaway County & State of Missouri already have already passed a use tax for their portion of the sales tax.
  • What will use tax revenues be used for?
    • The use tax will capture the same local sales tax rate for online out-of-state purchases and revenues are required to be used in the same manner already approved by voters. 
    • City of Maryville sales tax rate is 2.375%
      • 1% - General Fund (Police, Fire, Street Maintenance, Admin, etc. )
      • 0.125% - Debt Retirement
      • 0.125% - Conference Center Construction Fund
      • 0.125% - Maryville Parks & Recreation
      • 0.5% - Mozingo Lake Recreation Park (operation & maintenance)
      • 0.5% - Capital Improvements Fund (Street improvements, sidewalks, etc.)
  • What happens if the local sales tax rate increases by voter approval or decreases with the sunset of an issue?
    • The ballot language allows for the use tax to always be the same rate as the sales tax. 
  • How much revenue will the use tax generate?
    • The State of Missouri estimates Maryville would collect an additional $245,000 per year based on current online out-of-state vendor purchases if the use tax is approved by voters. 
    • $245,000 per year is equivalent to:
      • Personnel expenses for 5 police officers
      • or new sidewalks for 27 city blocks
      • or asphalt mill and overlay for 2 miles of city streets
      • or the sales tax from 6 JC Penny's
  • How does this impact out-of-state motor vehicle sales tax?
    • A court case in 2012 led to a mandate by the State of Missouri that motor vehicle sales taxes must be reauthorized by local voters before the end of 2018 or the municipality cannot continue to collect the revenue. Maryville collects approximately $45,000 annually from this source. If a use tax is approved by voters, the City will continue to collect out-of-state sales tax on motorized vehicles, boats, and trailers. 
  • Does this mean every online purchase will provide the City sales tax revenue?
    • No. Use tax only applies to goods purchased from vendors located outside Missouri. When a Missouri resident purchases online from a Missouri vendor, the sales tax rate is imposed at the vendor's location. The use tax also requires out-of-state vendors to have a nexus (physical presence) in Missouri. This can include a storefront, warehouse, sales representative, etc. 
  • Why is a use tax needed with federal efforts such as the Marketplace Fairness Act, Streamlined Sales Tax Compact, or court rulings of Wayfair v. South Dakota?
    • If court rulings, federal efforts on the Marketplace Fairness Act, or Missouri legislation enters into a Streamlined Sales Tax Compact, only cities with an existing use tax would see results of these measures. Voter approval of a use tax will still be required to apply the local sales tax rate to out-of-state purchases.

Additional Information:

Use Tax Educational Video

Use Tax Information Handout

Use Tax Presentation

Letter of Support - Blue Willow Boutique

Letter of Support - Tri State Ford Lincoln

Letter of Support - Greater Maryville Chamber of Commerce

Associated Industries of Missouri Article