Sales tax

City will teach and watch but not audit

The June 12 city council meeting was brief and full of laughter, and it adjourned only 20 minutes after it began.

What seemed to raise more eyebrows was the topic of discussion during the work session before the meeting.

“The question,” city of Cortez Finance Director, Kathi Moss, said, “is to audit or not to audit.”

All city council members were in attendance at the work session and put their heads together about whether or not to audit local businesses for sales tax.

“We’re just trying to make sure everyone is being honest,” council member Shawna McLaughlin said.

After much discussion on the matter, the council ultimately decided against auditing local businesses and instead will use proactive ways to promote education on sales tax to more new businesses and try to think of incentives for local businesses to attend a work shop on the topic.

“I don’t think that we will find anything incriminating, maybe just errors in filing,” Moss said. “We want our local businesses to not be bogged down by deep-handed audits. We want to look out for the mom-and-pop businesses.”

“My biggest problem with this thing is the invasiveness and the stress that could affect the medium-sized businesses and the mom-and-pop businesses that put the most money back into the Cortez economy,” said Matt Keefauver, mayor pro-tem.

Moss reported that seven of 12 cities close to the size of the city of Cortez are performing sales tax audits.

“I think that if the city does look at auditing it would just be about every business understanding that we’re taking a look,” city manager Shane Hale said. “If you never put a cop on a street, people are going to speed.”

The council agreed on promoting awareness as opposed to performing audits, which likely would not contribute to the city’s revenue stream.

“I would like to do a class on city sales tax and get businesses there and go over how to complete the form, where to go to get information,” Moss said. “We want to work as an outreach to local businesses,”

“What we want to do is get the word out there that we’re watching,” Moss added.

A “proactive” educational approach to sales tax will be formed in the near future and would likely offer incentives to local businesses in attendance.

Reach Paige Blankenbuehler at paigeb@cortezjournal.com.