(EDITOR'S NOTE: Today the Sun-Gazette continues its question-and-answer series involving candidates for Williamsport City Council.)
How do candidates for City Council think the city can improve on collection of mercantile and business privilege taxes?
The Sun-Gazette polled the six candidates seeking three open seats in the Nov. 5 general election to find out.
Seeking re-election are Councilmen Randall J. Allison, of 1308 Elmira St., and N. Clifford "Skip" Smith, of 835 First Ave., both Republicans, and Councilwoman Liz Miele, of 525 W. Fourth St., a Democrat.
Challengers are Scott Miller, of 822 Tucker St., a Republican, and Alison D. Hirsch, of 423 Rural Ave., and Kelly Anderson, of 533 Seventh Ave., Democrats.
Q: What can be done to improve on the collection of mercantile and business privilege taxes?
Allison: The city tracks collection of the business privilege and mercantile taxes in a number of ways. The tax office periodically does physical inspections of the Central Business District and other areas of town to identify new businesses and the codes officials do the same as they travel through. This information is cross-referenced against existing records.
New businesses are also identified when they apply for licenses through codes and zoning and that information goes to the tax office and then they are put into the system. Businesses are also tracked when they incorporate or apply at the state level to conduct commerce in the state.
We recently switched to a new tax collection agency and they will use our data base to identify any business not previously recorded on our rolls. Beyond that, we can keep our tax office supplied with the latest software and technology available that will enhance our ability to collect information about business activity in the city.
Anderson: I think City Council needs to be held accountable and have more oversight. If the issue falls on the treasurer, then council needs to make sure the office is supplying the right information. Another problem is the landlords are not all paying their fair share of the taxes. I believe many may not be aware but some are skirting the issue, and, again, that goes back to the oversight and checking on issues by council.
Hirsch: It's simply not fair that some businesses and landlords pay their taxes every year, while others don't. I've spoken with small landlords who weren't even aware that they should be paying business taxes, and I've heard of some restaurants that have never paid taxes. This isn't fair to those who diligently pay all they owe.
The city's new computer system should be a tool to collect business taxes fairly, across the board. The city should be able to cross-reference tax records with other state and local public records to identify those businesses that have not been paying their fair share of taxes. But the usefulness of the system will depend how good the computer software is and how well trained city personnel are in using it.
I believe the city should mount a major campaign to first educate the public on what sorts of businesses should be paying taxes; secondly, send out letters to businesses to collect back taxes, and finally offer some sort of amnesty or discount to those who come forward on their own to pay delinquent taxes.
Miele: We had a bit of good news during the lengthy discussions about the city's rental ordinance in our past two council meetings. Every time codes inspects a rental property, codes forwards that information to the treasurer's office to be certain that person is paying their business privilege taxes. This means that we now have the necessary database to make sure the city is receiving the majority of revenue from the city's large number of rental properties.
Indications are that our collection of both taxes is rapidly improving, now that we've sorted out a few issues we had with our tax collection service and that the treasurer is being proactive about reaching out to all new businesses in the city to inform them about these two taxes.
With all of that in mind, the only way to make sure that every business is paying its share of business privilege or mercantile tax is to notify all businesses and to take action if they fail to submit a return. The responsibility for identifying businesses falls to the treasurer, but collaboration between all city departments to help catch any stragglers is surely the best policy.
Our revenue from this budget line item has been steadily increasing, which is, it would seem, an indication of not just improved collection systems, but also of increasing business interests and revenue in the city.
Miller: I think there are several areas where the city officials can improve their collection of mercantile and business privilege taxes. One area is the people need to be more aware they have to pay them and when they are aware of it and are not paying them, the enforcement must be swift and aggressive. I would ask for the maximum fine and penalties allowable by law should there be scofflaws among the city rental community, especially. Many landlords are either refusing to pay or don't know they have to and that is a major problem, one that points toward a lack or poor communication.
Smith: As the codes and zoning departments receive various requests from new businesses, as well as existing businesses, the information gained should be transferred to the treasurer's office to determine if these businesses are paying these taxes and if not then appropriate action should be taken to collect them. This is also a problem with some landlords not paying these taxes. In some cases, crosschecks can be accomplished by the codes and treasurer's offices to determine if known rental properties are being taxed properly. There may be circumvention of this but there are processes to be implemented early next year to catch these owners who are avoiding paying the taxes, along with paying the proper amount of tax. This loss of tax dollars affects all city residents and everyone should pay their fair share.