1/2 Cent Capital Sales Tax

A one half percent tax levied on retail sales in the City of St. Louis is dedicated to Capital expenditures. The sales tax is not levied on certain items, including motor fuels, prescription drugs, food purchased with food stamps, all sales by or to not for profit organizations and residential utility charges.

Discussion

City voters approved the 1/2 cent sales tax for capital improvements in August, 1993. FY95 represented the first full year of collections of this new source of revenue. Projected revenue for FY99 is expected to grow at slightly less than 2% over revised FY98 estimate. The City ordinance authorizing the 1/2 cent sales tax included a formula for allocating the proceeds among various capital spending areas. This allocation is illustrated in the pie chart below: