W. Idaho shoppers make run for no-tax Oregon, hurting local shopsThis is the same situation that Washington border towns like Pullman have faced for years with a much lower sales tax in Idaho. Retailers have consistently chosen Idaho with its lower sales tax and lower minimum wage. That's another reason we should roll out the red carpet for Wal-Mart because they chose to open here, even before the Supercenter in Moscow was rejected.
PAYETTE, Idaho (AP) -- Western Idaho retailers are lamenting the Oct. 1 state sales tax increase to 6 percent to cover property tax relief, saying the move will continue to drive area shoppers to nearby Oregon where there's no sales tax.
Voters across Idaho will have a chance Tuesday to say if they liked Gov. Jim Risch's plan, which lopped off a $260 million dollar chunk of property taxes that previously went to schools, and then made up the difference by boosting the state sales tax from 5 percent. It's only an advisory vote, to gauge opinion, so it won't necessarily mean any changes.
In Payette and Fruitland, some officials say the Idaho Legislature's vote to back Risch's plan will intensify the trend of businesses skirting these towns for neighboring Ontario, Ore. Just across the Snake River from Idaho, the parking lot at Ontario's Wal-Mart SuperCenter is full of cars with Idaho's "Famous Potatoes" license plates.
Case in point: Grief's Music closed its 56-year-old location in Payette in 2004, but kept its operation in Ontario where customers can save $72 in tax on a $1,200 digital piano.
"It was like leaving the home you grew up in, but it eventually caught up with us and we couldn't do it any longer," owner John Greif, whose father founded the store in Payette in 1948, told the Idaho Statesman.
Greif opened the Ontario store in 1985 because he observed more and more of his customers migrating across the border.
Penny-pinching customers say the difference in price is important.
For every $200 Fruitland resident Candis Bayes pays for groceries in Ontario's Wal-Mart, she'd pay $212 back home.
"We shop over here every week," said Bayes, while juggling her young children and loading two shopping carts full of purchases into the back of her SUV. "Truthfully, I would like to see the (Payette County) mom-and-pop businesses succeed, but we have five kiddos and groceries add up."
Efforts in the Idaho Legislature to lower the sales tax in the region surrounding Payette and Fruitland have faltered.
In 1996, former state Rep. Donna Jones, R-Payette and now a candidate for state controller, said she convinced her colleagues in the House to back a five-year cut of the then-5 percent tax - only to see her measure die in the Senate.
"The sales tax was having a huge effect on small businesses at the time," Jones remembers. "We put a sunset on it because we thought that would give them enough time to get back on their feet."
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