GRID wrote:
I have paid the Etax all my life. I say get over it.
We agree on something GRID
the city doesn't offer anything additional except location
Well, location is something. A big "something" if you ask me. If the location isn't worth 1%, then maybe the suburbs are a better answer. We eliminate the 1% earnings tax, this guy moves his business to KCMO, bears little to no ta burden (being a Kansas resident), while KCMO residents see their taxes skyrocket. I don't see how that is a positive development.
Kard wrote:
Shouldn't an accountant be able to run different scenarios for where the office is located? There has to be other tax / financial factors when comparing a location then just KCMO's e-tax.
Kard, Yes. Any CFO or accountant worth their keep can run a full financial scenario and cost-benefit analysis.
If they are not a client/customer-facing business and simply have to "plop down some servers" then KCMO may not be best for them regardless of the tax rate. Gardner or Belton offers cheaper land, less expensive rent and oceans of free parking. They are probably better served there anyway IF that is what they consider.
KCMO should not be the Wal-Mart of municipalities simply to attract business. We end up losing all around that way. Keep the 1% earnings tax and focus on making KCMO better with infrasturcture, less red tape, better walkability... The businesses will come.
lock+load wrote:
Well, location is something. A big "something" if you ask me. If the location isn't worth 1%, then maybe the suburbs are a better answer. We eliminate the 1% earnings tax, this guy moves his business to KCMO, bears little to no ta burden (being a Kansas resident), while KCMO residents see their taxes skyrocket. I don't see how that is a positive development.
location is something....my point is bigger than this one company....is it a big enough something to a company looking to move to the metro? Some times yes, as history has proven, many times no...especially mid to small sized companies.
I'd have to say the state getting that tax money from new employees and business is a positive development...obviously you don't think so. This is one reason why businesses are bailing on KCMO..should we not look at other options to keep that from happening?
Like I said, the Etax is an excuse and it's the largest source of revenue for the things people complain about the most. Infrastructure. Which is what I think has far more impact running out KCMO businesses than the Etax. Ask Cyclops. I'm sure he's more than willing to pay the etax even though he lives in Kansas. He might even be willing to pay a little more if the city would fix Main Street in front of his business. Why? Because he WANTS to be in the "city".
KC's biggest problem is that most of these companies flee KCMO for JoCo because the companies and their employees WANT to be in the new office parks out south. They live out there, shop out there and that is their life. Urban lifestyles, be it living or employment is a challenge in KC where most people move here from rural KS, IA, NE etc and simply have no desire to work downtown unless forced even though our urban core is one of the most laid back and easy to navigate, cheap to park, big city downtowns in the nation. It's all relative. They choose instead to fight the massive traffic jams of OP that make downtown traffic look like Warrensburg.
Till those same people WANT to be Downtown, or in the Crossroads or Crown Center or the Plaza, things will not change, even if the city gave back 1% instead of taking it.
That's hapening. Slow as hell, but it's happening. Downtown and KCMO in general is coming back and is becoming a place people want to be associated with.
Most employers I know that operate in the core of the city WANT to be there (including mine). They don't look for every excuse in the book and try to compare it to Overland Park because it's not a fair comparison and really doesn't make sense.
I say if the 1% is that big a deal (and again, it shouldn't be because other taxes are lower) then let them go. They will probably leave in a year anyway for some location on 151st and Metcalf where everything is perfect and there is no Etax. Out there "KCMO" rarely even crosses people's minds, it's like another planet and many people like it that way.
Last edited by GRID on Tue Apr 10, 2007 1:44 pm, edited 1 time in total.
I would agree that in the end things tend to balance out between most cities when you look at the total tax picture. However, it seems like the eTax jars people's consciousness much more alarmingly than other forms of tax. Most folks don't think twice about traveling to a destination retail center and paying a premium 13% sales tax rate, but if you put it in the all to common wording "you will take a 1% pay cut if you move to KCMO", it seems to jar people's attention much more alarmingly. Somehow it is much more visable and threatening to people.
If the earnings tax is such a disincentive to locating in KCMO, then why is KCMO building more new houses than than OP, Olathe, and Lee's Summit combined? If it was really such a disincentive would we have 20,000 houses platted for the Hwy 152 corridor? I think not.
What would you trade for the earnings tax? A 15% sales tax? Would you be willing to pay twice as much in property tax? Without the earnings tax KC would be in the same situation as many other central cities like Des Moines, Detroit, etc. that all have crippling property tax rates and struggle to pay for city services.
LenexatoKCMO wrote:
I would agree that in the end things tend to balance out between most cities when you look at the total tax picture. However, it seems like the eTax jars people's consciousness much more alarmingly than other forms of tax. Most folks don't think twice about traveling to a destination retail center and paying a premium 13% sales tax rate, but if you put it in the all to common wording "you will take a 1% pay cut if you move to KCMO", it seems to jar people's attention much more alarmingly. Somehow it is much more visable and threatening to people.
Yep, that is the biggest problem with the Etax. But if you are going to open a business, buy a home, relocate a corporation, I would think you would eventually get beyond the "sticker shock" of the etax and educate yourself a bit on the issue. I'm sure others like the EDC will also shed some light on the issue as you go through the process of bringing a business to KCMO.
So again, I think it's only an excuse to not locate in KCMO, or just something that's easy to bitch about.
GRID wrote:
Yep, that is the biggest problem with the Etax. But if you are going to open a business, buy a home, relocate a corporation, I would think you would eventually get beyond the "sticker shock" of the etax and educate yourself a bit on the issue. I'm sure others like the EDC will also shed some light on the issue as you go through the process of bringing a business to KCMO.
So again, I think it's only an excuse to not locate in KCMO, or just something that's easy to bitch about.
Yeah but at what point would be better served by looking at some of the more common, less alarming tax sources instead of just saying "get over it"? Might we be better served to have higher sales taxes and/or property taxes instead of this tax that sticks out like a sore thumb?
Because I think the psychological effect would be the same, yet the economic backlash would be even worse than the etax. "KCMO has the highest property taxes and sales taxes in the metro". Doesn't sound much better than KCMO has an Etax. It would impact KCMO residents more rather than spreading it out over more of the metro too.
If you raise property taxes 20%. You will see a slowdown in home construction in KCMO. People do talk about the sales taxes and people know where they are high. While the 1% is really a very low impact tax, typically spread out over pay periods.
I hate to say "get over it", but sometimes you get to that point because no matter what you do, some people are going to bitch about it.
In looking at the ridiculous tax forms it is not at all clear whether residents who DO NOT WORK in KCMO owe earnings tax. It looks very much like only residents who work in KCMO owe. Is this correct? I am completely lost reading through the convoluted tax wording nonsense.
"It is not to my good friend's heresy that I impute his honesty. On the contrary, 'tis his honesty that has brought upon him the character of heretic." -- Ben Franklin
It is very simple actually. If you:
1. Live in KCMO
or
2. Work in KCMO
You owe the earnings tax.
It is actually a nice way to ensure that the people who work in KCMO but live elsewhere pay their share of the cost for maintaining the infrastructure.
KCTigerFan wrote:
It is very simple actually. If you:
1. Live in KCMO
or
2. Work in KCMO
You owe the earnings tax.
It is actually a nice way to ensure that the people who work in KCMO but live elsewhere pay their share of the cost for maintaining the infrastructure.
Yes, and as large as KCMO is, this tax touches a very large portion of the metro area. It is the area's only true fixed regional funding source that is used to maintain an infrastructure of a city that is used by most of the area's 2 million residents and our tourists, not just the 440k in KCMO. The tax is not only used to maintain streets, but goes to places like the zoo or liberty memorial and union station (which is now a KCMO responsibility, or at least they are the ones asked to subsidize them now).
You could live in Olathe and work at the Walmart in Martin City. You will pay the tax. You could live in Shoal Creek and work in Liberty and pay the tax. You could live on Lee's Summit Road and work in Blue Springs and pay the tax. You could live in Shawnee and own a business on the plaza and pay the tax. It's not just those that work downtown like so many people think. KCMO would be crippled without the Etax and even though there are hundreds of thousands that live and work outside KCMO and don't pay the tax, if the Etax were removed and KCMO replaced the tax with another source, it would be a large increase for KCMO residents, even though they already pay the etax. If that makes sense.
Last edited by GRID on Tue Apr 10, 2007 3:35 pm, edited 1 time in total.
KCTigerFan wrote:
It is actually a nice way to ensure that the people who work in KCMO but live elsewhere pay their share of the cost for maintaining the infrastructure.
Since when is justice an important part of infrastructure maintenance? I think it's complete hogwash. It obviously isn't, since people that never use some certain streets are still responsible for the cost of maintaining them, through taxes.
The way I see it, the purpose of taxes is to finance government operations, not to punish people that are deemed not to be doing their "fair share." If they get enough money, what does it matter where it comes from?
It is not a "punishment" tax. You only pay the tax if you LIVE or WORK in KCMO. Either way you drive in KCMO to get to either your home or business. You also use the police and fire protection et cetera.
KCTigerFan wrote:
It is not a "punishment" tax. You only pay the tax if you LIVE or WORK in KCMO. Either way you drive in KCMO to get to either your home or business. You also use the police and fire protection et cetera.
I know what it's for. I just think it's dangerous to think in such a way as to say that it's nice that a tax makes everyone pay "their fair share."
Kansas is ranked 17th and Missouri 34th in total tax as a % of income. Simply reinforces the idea that Kansas overall has higher taxes. If you add in the 1% Etax they basically equal out.
You may be right. Just based on gross generalities the study lists Kansas at 11.2% of income and Missouri at 10.1%. JoCo I am sure is higher than the average for Kansas.
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