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Missouri: Approve It or Lose It

  • Jan 29, 2016 | Gail Cole

 Missourians consider use tax, sales tax, and motor vehicle tax.

If you purchase a motor vehicle (or boat, trailer, or outboard motor) in another state and bring it into Missouri for use or storage, Missouri sales taxes are imposed on the sale at the time of titling under HB 184 (enacted in 2013). Yet local governments in Missouri can only collect local taxes on these sales if voters have approved a local use tax.

Under House Bill 184:

“All local taxing jurisdictions that have not previously approved a local use tax must put to a vote of the people whether to discontinue collecting sales tax on the sale of motor vehicles, trailers, boats, or outboard motors purchased out-of-state when titling in Missouri.” 

The bill stipulates that the ballot question must contain language similar to the following:

Shall (local jurisdiction) discontinue applying and collecting the local sales tax on the titling of motor vehicles, trailers, boats and outboard motors that were purchased from a source other than a licensed Missouri dealer? Approval of this measure will result in a reduction of local revenue.... and it will place Missouri dealers of motor vehicles, outboard motors, boats and trailers at a competitive disadvantage to non-Missouri dealers of these items.

The local tax must be approved by vote before November 2016. If it isn’t, “the taxing jurisdiction must cease collecting the [local] sales tax” on vehicles purchased in another state and registered in the locality.

Voters in Osage Beach will decide this issue during the April 5 election. If they reject it, the city stands to lose as much as $34,000 in sales tax revenue annually. Officials in Camdenton and Laurie are still deciding whether or not to place it on the ballot.

If imposed, these local taxes may be repealed by a vote of the people. Voters may request a repeal of the tax at any time, provided “15% of the registered voters in a taxing jurisdiction sign a petition requesting it.” Learn more about Missouri use tax and vehicle sales tax here.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.