Some businesses missed start of sales tax

Most Marion County businesses made adjustments for the new half-cent sales tax effective July 1, but some were caught off guard.

County Clerk Carol Maggard said she received calls from a business in Goessel and Peabody asking if the tax went had gone into effect because the owners said they hadn?t been charging customers the extra amount.

Although empathetic, Maggard said there is no way the county could alert every sales-tax filer about this change.

?We are not responsible for notifying businesses about these changes,? she said.

Compounding the problem, Maggard said if a business hasn?t started collecting the additional half-cent tax, it is still responsible for paying it, even if the money comes out of its own pocket.

The Kansas Department of Revenue?s website posts the changes for any sale tax changes, she said.

Dan Holub, Marion County Commissioner, said the state changed its policy without announcing it.

?(The state) used to automatically get the word out about tax increases but no longer does that,? he said. ?Some businesses went to the website to check, but it was down.?

State responds

Steve Brunkan, a financial economist with the KDOR in Topeka, said he agrees the notification process needs improvement.

?We know it?s a problem,? he said, ?and we are continuing to look at ways to improve it.?

Brunkan said all businesses affected by an increased sales tax would have received notification about 75 days before the tax went into effect.

?Under Kansas statute, we are required to give a 60-day notice (to tax rate filers), and the rate change had gone out at the end of April,? he said.

That?s a help for some, but for other retailers, he said, the notification is still a problem.

Some retailers may never get notification because they have a third party involved, citing larger national chains where the local franchise is left out of the loop.

A similar problem, involves businesses that have a certified public accountant doing their taxes and that person doesn?t report the increase to the owner.

Improvements

A recent update was done recently on the state?s website, according to Brunkan, who said about 80 percent of sales-tax businesses file online.

?We have a flash page memo on the sales tax account that shows when rates change,? he said.

A change that has caused problems for businesses, Brunkan said, is that the state now sends postcards annually instead of quarterly.

Businesses that have yet to add the additional sales tax could be looking at almost two months of uncollected sales tax before it?s caught, Brunkan said.

?The July sales tax isn?t due until Aug. 25,? he said.

Preventing problems

Both Brunkan and Holub encourage people to read their local newspapers.

?The only way I know how to get the word out now (regarding adjustments in sales tax) would be a newspaper article,? Holub said.

Brunkan sending postcards to all the businesses would be cost prohibitive.

The new half-cent sales tax was approved by 64 percent of Marion County voters during the April general election.

The money from this added tax is going toward paying for a new county jail that will be located east of the courthouse.

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