Here’s one fact that wasn’t part of the dog-and-pony show Tuesday morning when Kansas Gov. Sam Brownback signed a budget bill that includes the largest tax increase in state history.
The sales tax burden on people who shop in Johnson County could soar by $37 million a year.
That’s a lot of money. In fact, it’s one-fourth of the entire amount of extra sales tax revenue Kansas expects to get annually when the state sales tax goes from 6.15 percent to 6.50 percent in the next month or so.
The higher sales tax is just one of the bad results imposed on Johnson Countians by the reckless budget bill the Legislature approved last week. A tearful Brownback successfully pleaded with lawmakers to protect the unfair and costly income tax cuts he signed in 2012.
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Here’s the math:
Kansas Department of Revenue figures show that Johnson County collected $640.5 million in state sales tax revenues in 2014. That total could leap to more than $677 million a year — all things being equal — when the sales tax hits 6.50 percent. (Statistically, that’s a 5.7 percent hike in the overall sales tax rate.)
In addition, the sales tax revenue burden in Wyandotte County could go up by around $7 million annually.
Plenty of retailers in Kansas are justifiably concerned that people will hop the state line and make more of their purchases in Kansas City and other Missouri-side cities once the higher Sunflower State tax is in place.
The total sales tax rate is 8.475 percent in the big part of Kansas City that’s in Jackson County. Look at what the total rates soon will be in some Kansas-side cities:
▪ Shawnee and Mission — 9.350 percent
▪ Olathe and Gardner — 9.225 percent
▪ Kansas City, Kan. — 9.125 percent
▪ Lenexa — 9.100 percent
▪ Merriam — 8.975 percent
▪ Overland Park and Leawood — 8.850 percent
▪ Prairie Village — 8.725 percent
Grocers in Kansas are particularly worried about what could be ahead
The Missouri sales tax on food is only 1.225 percent. But the Kansas state tax on food soon will be 6.5 percent.
Some Kansas-side families could save hundreds of dollars a year by shopping in Missouri’s grocery stores.
True, the Kansas tax is already far higher at 6.15 percent, and plenty of people shop for food in Overland Park, Leawood, Lenexa and other Kansas-side cities.
But the higher sales tax rate for grocers and other businesses will upset at least some of the economic equilibrium in the Kansas City metropolitan area.
How far will things go? No one knows at this point.
However, the continuing budget crisis in Kansas, caused by the 2012 income tax cuts, is likely to hang around a lot longer.