A proposal for Jefferson County to follow the state's lead and exempt clothing from the local share of sales tax (3.75%) is ill advised policy.
While wanting to give a break to "working families" has its obvious appeal, the clothing exemption takes one product that different people buy in varying degrees and makes it exempt, while other essentials like gasoline are fully taxed.
The other reason is the geographic anomaly that Jefferson County enjoys and that is the proximity to Canadian shoppers...Many of those shoppers buy clothing and the exemption obviates much of the benefits of cross border trade we now enjoy.
The latest estimates for February continue to show sales tax performing at six to eight percent above projections. This is money that flows into the coffers of every municipality in the County due to a sales tax distribution agreement between the County and the City of Watertown.
The sales tax is providing a much broader base of funding local government than the property tax which is heavily skewed by assesment differences and huge use of exemptions....
The better course for the county (they control the issue) would either be lower the overall rate on all products, or give the money back in the form of significantly lower property taxes.
As you know I have proposed the City do just that in conjunction with our continued efforts to reduce the city's debt load by paying cash for smaller capital projects.
Exemptions create inherent inequities, although I realize that under the statutes that is the only product that can be made exempt.
Broader based tax relief is the way to go and our unique ability to gain from cross border activity should make us think twice about exempting people who don't even live here.