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Opposition doesn't stop tax hike

June 02, 1999|By BRYN MICKLE

MARTINSBURG, W.Va. - The protests of city business leaders were not enough to sway the Martinsburg City Council from voting for a 30 percent hike on some of the city's business-and-occupation tax rates.

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City officials said the increase will generate about $750,000 for the city's general fund budget and will help the city balance future budgets without trimming services.

Opponents to the hike in the "B-and-O" tax, however, argue the city is unfairly balancing that budget on the backs of business owners.

Those sentiments were illustrated on the signs of five people who picketed in front of Martinsburg City Hall about 20 minutes before Wednesday night's special session.

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"This isn't a fair tax. It doesn't equally spread the cost of doing business in the city and it only applies to business owners," said Kimber White, owner of the Boomtown Restaurant.

The city will raise taxes on several groups, including retailers, contracting businesses, manufacturers, wholesalers, loan companies, service businesses, owners of rental properties, banks and other financial-service businesses.

The rates and their increases vary for each category.

Under the new rates, retailers, for example, will pay 42 cents on every $100 of gross revenue, and contracting businesses will pay $1.03 on every hundred.

White said the tax increase will cost his business between $200 and $300 a year - money he said could go toward paying a part-time worker or buying a new piece of equipment.

With about 50 people looking on in the City Council meeting room, business owners and Martinsburg-Berkeley County Chamber of Commerce President Max Oates asked the council to delay its decision and look at other avenues for revenue.

Some 160 of the chamber's 500 members are inside the Martinsburg city limits and increasing business taxes could be a deterrent to new business and hurt already established businesses, Oates said.

The city looked at other options, including a property tax and municipal service fees but decided those would not bring in as much money as the B-and-O tax increase, Martinsburg City Manager Mark Baldwin said.

Martinsburg has increased B-and-O taxes just once since 1969, according to the city's Budget and Finance Committee. With the increases, Martinsburg's tax level will be typical of other West Virginia cities, including Wheeling and Morgantown, committee members said.

Oates said he was disappointed with the council's vote, but added the chamber plans to work with state lawmakers to create new ways for municipalities to raise revenues.

City Council members George Karos and Oden Barrett voted against the B-and-O increase, which will go into effect on July 1.

Karos, a city business owner and longtime opponent of the tax, asked the council to table the issue and said increasing the tax was "not doing the right thing."

Also, the council voted 6-1, with Barrett objecting, to approve a garbage fee increase expected to generate $171,000 in new revenue.

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