Some Missouri residents no longer can gain a tax break by buying a vehicle from an out-of-state dealer or an individual with a for-sale sign in the window.
Gov. Jay Nixon enacted a law Friday that immediately reinstates local vehicle taxes for numerous cities and counties that have been unable to tax cars, trucks and boats since a state Supreme Court ruling more than a year ago.
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Nixon twice vetoed previous bills that sought to re-impose the local vehicle taxes. His office said in a brief written statement that the previous bills “did not sufficiently protect Missourians’ right to vote on tax policy” but that the most recent version “addresses these concerns by requiring a public vote in local jurisdictions without a local use tax.”
Some Illinois vehicle dealers in the St. Louis area had targeted Missouri consumers with the prospect of a tax break. Retailers in some other Missouri border cities also had seen more customers go elsewhere.
“We were the only state where there was an advantage for the citizens of the state to not make purchases in the state,” said Sam Barbee, president and CEO of the Missouri Automobile Dealers Association.
Cities and counties also had backed the legislation, because they had been losing tax revenues. But Friday marked only a partial victory for the Missouri Municipal League. That’s because the governor also signed a bill limiting the ability of governmental entities to restrict cellphone towers, which it had urged him to veto.
The vehicle tax legislation is a response to a January 2012 state Supreme Court ruling. The court said Greene County could not charge a local sales tax on a man who bought a boat from a dealer in Maryland. The ruling drew a distinction between sales taxes, which are collected from in-state retailers, and use taxes, which are levied on products used in Missouri but bought either from an out-of-state retailer or from someone who does not run a business.
The Supreme Court said Greene County could not tax the boat because it wasn’t covered by the local sales tax and county voters had not approved a local use tax.
The ruling had broad implications because a little less than half of Missouri’s 114 counties and most of its municipalities had no voter-approved use tax.
The new law seeks to sidestep questions about the location and manner in which a vehicle is bought by redefining vehicle sales taxes to apply to the act of titling vehicles. The newly defined tax kicks in immediately. Within the next two years, local governments that did not previously have a voter-approved use tax must give voters a chance to repeal the titling sales tax for vehicles bought out of state or from individuals.
Though legislative supporters are confident about the new approach, some attorneys have raised concerns that the measure still could violate state constitutional provisions by imposing a local tax prior to voter approval.
Nixon also signed bills Friday that limit the ability of cities, counties and state entities to regulate cellphone towers.
Bill sponsors said the legislation was prompted by concerns from cellphone service providers that have encountered a hodgepodge of local requirements as they expand their high-speed networks to accommodate customers who use wireless devices to access the Internet.
The legislation sets deadlines for public entities to act upon applications for cellphone towers and lists 18 things they cannot do when regulating the towers.
For example, governments will be barred from evaluating cellphone tower applications based on whether there were other possible locations or whether a company could have added its equipment to an existing tower used by a competitor. They also will not be able to require companies to remove existing wireless facilities as a condition of building new ones. And the bill limits the charges that governments can pass on to wireless companies for their cost of hiring consultants.
Dan Ross, the executive director of the Missouri Municipal League, said the legislation “pretty well gives a special deal to one industry and moves their applications to the head of the line.”
Nixon’s office said the law will expand access and improve service “through more rapid deployment of broadband and wireless network infrastructure.”