Stafford officials will soon consider a new business tax, the first step in achieving possible approval of the controversial levy. The Board of Supervisors voted 4-3 yesterday to hold a public hearing about implementing the Business, Professional, and Occupational License Tax. The board will consider charging half of the maximum rate allowed by state law during the meeting next month.
Supervisors Cord Sterling, Paul Milde and Mark Dudenhefer voted against the public hearing.
BPOL is a tax on businesses' gross receipts. Stafford is one of the only area localities that does not charge BPOL. About half of the state's counties, most of its towns, and all of its cities have a BPOL tax, according to the University of Virginia's Weldon Cooper Center for Public Service.
The counties of Spotsylvania, Fairfax, Prince William, Loudoun and the city of Fredericksburg charge the tax.
BPOL supporters have said it could serve as a potential revenue source, especially in the wake of county budget cuts due to declining sales and real estate tax revenue.
However, Stafford business owners already are facing higher tax bills because of a 28 percent increase in commercial property values during a recent reassessment. And commercial property owners along State Route 610 and U.S.17 are paying a service district tax to help fund road improvements.
Bob Hagan, president of the Fredericksburg Regional Chamber of Commerce, argued BPOL will only stunt future business growth in Stafford.
"There are some who believe it will not affect businesses coming to Stafford," said Hagan, a former Spotsylvania County supervisor. "How did you decide that such a decision will not prevent people from getting jobs closer to their homes?"
The Stafford Economic Development office uses Stafford's lack of a BPOL tax as a recruiting tool. Among Virginia localities, Stafford ranked fourth in new business growth between 2002 and 2007, according to the Economic Development Department.
Milde, who owns a hardware company in Stafford, said the tax is "going to roll up the red carpet we put out for businesses. A vote of 'yes' here is a slap in the face for the business community, who has been double-taxed in the last year."
The public hearing on BPOL will be held July 1 at 7 p.m. in the County Administration Center located at 1300 Courthouse Road in Stafford.
Kafia Hosh: 540/735-1977
Email: khosh@freelancestar.com
The BPOL tax is on gross receipts from a business. Localities can set a minimum amount of gross income before the tax would kick in, which could end up exempting mom-and-pop stores. Jurisdictions can set different tax rates for different types of businesses, and don't have to charge the full amount allowed by law. Spotsylvania, for example, charges half the rate allowed. Stafford already charges 14 different business-related taxes. For example, the business property tax is on everything a firm owns, including computers, desks and other materials. POTENTIAL REVENUEIf Stafford imposed the full rate at a $100,000 threshold, a BPOL tax could bring in up to $7.8 million a year, according to the commissioner of revenue's office. BPOL would replace the Merchants Capital Tax, which brought in about $800,000 in 2006. State law prohibits localities from charging both taxes. |