City food, beverage tax is off table

By Tom Joyce -
Stevens -

A proposed food and beverage tax for Mount Airy has been taken off the menu — at least for the foreseeable future.

The idea of imposing a tax on prepared foods and beverages such as those sold at restaurants, in addition to regular sales taxes, was first mentioned publicly during municipal budget discussions last June.

A possible city food/beverage tax, which would not be levied on grocery store purchases, was suggested by Commissioner Jon Cawley as an additional source of revenue for the municipality other than raising property taxes or dipping into savings.

He said then that in speaking with officials from places in North Carolina which have imposed that tax, the resulting revenues rivalled those derived from property taxation.

More recently, that source was cited as a way to help pay for a costly Barter Theatre expansion on former Spencer’s industrial property which is now being considered by Mount Airy officials. But Cawley says the food and beverage tax is off the table due to lack of support by state legislators who represent Surry County in the N.C. General Assembly.

Legislative approval is required for such a tax to be enacted in a locality such as Mount Airy. But neither Rep. Sarah Stevens of Mount Airy nor Sen. Shirley Randleman of Wilkesboro are willing to sponsor a bill to bring that about in 2018.

“An election year is not a good time to raise taxes,” Stevens said Tuesday in illuminating her position on the food and beverage tax, which she said also applies to any other type of taxation.

She pointed out that in addition to advancing proposed legislation aimed at authorizing Mount Airy to adopt the food/beverage levy, the local delegation could seek a referendum, or special vote, allowing citizens to decide whether it’s enacted.

“It’s still not a good thing to do in an election year,” Stevens said of advocating for a referendum.

Despite the city of Mount Airy spearheading such a tax, local voters would still hold her and Randleman responsible for any action requiring them to pay more when dining out, the local lawmaker explained.

And simply sponsoring special-legislation bills for the food and beverage proposal is no guarantee it would win approval among General Assembly members as a whole.

“Everybody has to vote on it,” Stevens added of the support required. “It’s not just Shirley and I.”

Stevens said she understands Mount Airy’s desire to move forward and find extra revenue, but also mentioned “the ultimate consumers” who are hit with extra charges for restaurant meals.

As a municipal taxpayer herself, the state representative, a longtime attorney, indicated that the argument could be made that city residents are paying enough for various taxes already.

Referendum preferred

With her and other state lawmakers up for re-election to new two-year terms this fall, Stevens also is not willing to sponsor food and beverage tax legislation next year for the same reasons.

She said her support would be limited to having local citizens decide the issue through a vote.

“A referendum is the most popular way to do that,” Stevens said in reference to other localities that have added a food and beverage tax.

The state representative mentioned another type of taxation requiring legislative approval, an occupancy tax levied at lodging establishments. While an argument can be made that it targets tourists more so than locals, that’s inevitably not the case with a food and beverage tax, she said.

“We know who’s going to pay, and it’s the people who live in that community.”


By Tom Joyce

Tom Joyce may be reached at 336-415-4693 or on Twitter @Me_Reporter.

Tom Joyce may be reached at 336-415-4693 or on Twitter @Me_Reporter.