Some B&O Tax Relief Imperative

Implementation of a one-half percent municipal sales tax in Wheeling was part of an informal deal city officials made with residents and business owners. Proceeds from the tax would be used for two primary purposes: improvements to infrastructure, including WesBanco Arena, and a reduction in the city business and occupation tax.

But the sales tax is producing significantly less revenue than had been expected. That has led City Manager Robert Herron to suggest City Council consider delaying promised cuts in B&O taxes.

Unless that is done, “citizens would see a reduction in infrastructure improvements immediately,” Herron warned last week.

But a deal is a deal, even if informal. As Councilman Don Atkinson pointed out, “the public perception is going to kill us” if B&O tax relief is not provided as promised.

It is unlikely many business owners were counting on a B&O tax cut. After all, most are accustomed to dealing with empty promises from government at all levels. But proof they cannot believe municipal officials may come back to haunt city government.

At some time in the future, trust between the business community and city government will be important for some specific reason. What happens when, asked to go along with a city plan, business owners respond, “Nope. Remember the B&O tax promise?”

Business owners do understand the bottom line, however. Plans for both the tax break and infrastructure improvements had been predicated on $2.4 million a year in sales tax income. Now, Herron predicts only $1.64 million from that source for the fiscal year that starts July 1.

Somewhat less B&O tax relief than had been pledged may be acceptable to business owners, then.

Telling them to forget it entirely – that, in effect, they were suckers for believing a promise – would be a major mistake, however.