Editorial: Time to stop on sales tax hikes

Approval of Island Transit’s sales tax increase to maintain services in these dire economic times was a testament to residents’ love of their local bus system. The rule of thumb in government is that you don’t ask voters for a tax increase during a recession, but Island Transit proved it can be done successfully. All it takes is years of hard-earned good will and a large core of supporters who will help get out the vote. Having received nearly 55 percent of the vote Tuesday, Island Transit can now proceed with its future, collecting the maximum amount of sales tax allowed by law, or nine-tenths of 1 percent, for transit.

The only downside is that the Island County’s high sales tax will soon be higher than ever, at a total of 8.7 percent, or nearly 9 cents on the dollar. Any time the tax man adds nearly 9 percent to the sale price, merchants get worried that customers will look elsewhere to make their purchase.

North Whidbey’s most direct retail competitor is Burlington, where the big malls and box stores are located. The sales tax there is 8.2 percent, according to the Department of Revenue. It’s only a difference of .5 percent, or 5 cents on a $10 purchase, but it does add up. People can save 50 cents on $100 spent, $5 on $1,000, $50 on $10,000 or $100 on $20,000. Ask and dealer in big-ticket items like appliances, furniture and automobiles, and they’ll tell you that it hurts. Customers will indeed drive 50 miles to save a few bucks.

Thanks to sales tax add-ons like the transit tax, juvenile detention center and tax mental health tax, Island County’s sales tax is near the top in the state. Some are still higher. Whidbey Island merchants won’t be losing business to the Everett Mall, where the sales tax is 9.2 percent, or the Alderwood Mall, where it’s 9.5 percent, which equals the state high in Seattle and King County, but the sales tax is lower almost everywhere else in the state.

To stop the situation from getting worse, the Washington State Legislature should refrain from allowing local jurisdictions to raise the sales tax. It’s just a way to put off hard decisions at the state level, and it unfairly distributes services throughout the state.

Until that happens, Island County has to put the brakes on any more sales tax increases and wait for other areas to catch up.