Cottonwood holds first reading of proposed use tax ordinance

Tosca Henry, Linda Norman, Kyla Allen, Mayor Tim Elinski, Vice Mayor Karen Pfeifer, Ruben Jauregui and Deb Althouse.

Tosca Henry, Linda Norman, Kyla Allen, Mayor Tim Elinski, Vice Mayor Karen Pfeifer, Ruben Jauregui and Deb Althouse.

COTTONWOOD – There was minimal attendance for the Cottonwood City Council’s first reading of the Use Tax ordinance Tuesday.

The proposed Use Tax, modeled after Flagstaff’s, has received some push back from the public, according the meeting agenda.

A Use Tax is a tax on tangible property, like a vehicle or furniture, which is purchased (or leased) for use or storage in Cottonwood on which tax was not paid at the time of purchase (or rental.) The tax will not apply to property worth under $1,000 or property where a Transaction Privilege Tax of 3 percent of more was paid.

The aim of the Use Tax is to protect local vendors by removing incentives to shop outside of the city or state.

Cottonwood’s Deputy City Manager Rudy Rodriguez presented benefits of a Use Tax in Cottonwood: minimal burden on local citizens, leveling the playing field for local businesses, reduction of tax leakage and additional revenue at no additional cost.

“The impact to the city is estimated to be $75,000 annually and will be used to support current as well as future community needs…the City of Cottonwood provides more services than any other community in the Verde Valley on only a 3 percent Transaction Privilege Tax,” Rodriguez previously told the Verde Independent.

The Use Tax will not add 3 percent on top of the 3-percent Transaction Privilege Tax.

The second public reading of the ordinance will be held on Jan. 16 at 6 p.m. at the City Council Chambers, 826 North Main Street.

What else happened at the meeting?

• The Council approved using proceeds from the Yavapai-Apache Nation on IT upgrades at the Civic Center.

• The Council approved giving $2000 to the Welcome Home Vietnam Veterans committee for the 2018 event. Councilmember Deb Althouse suggested if this was something that will be approved every year, as it has in years past, next year the $2000 should be budgeted. Mayor Tim Elinski agreed.

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