A Town of Tappahannock proposal to increase rates for the BPOL (Business, Professional and Occupational) tax drew the ire of a handful of Tappahannock business owners during the September 11 meeting of Town Council.
The proposal calls for rates to increase in these categories: •Business, personal, repair and other services from 35 cents for each $100 gross receipts to 36 cents for each $100 gross receipts; •Contractors and Contracting from 15 cents for each $100 gross receipts to 16 cents for each $100 gross receipts; •Retail Merchant rate would remain the same at 20 cents per $100 gross receipts;
•Financial, Professional and Real Estate Service from 54 cents per $100 gross receipts to 58 cents per $100 gross receipts.
Prior to a public hearing on the matter, Tappahannock Town Manager Eric Pollitt noted that the rates had not been adjusted in 15 years.
“Professionals are already the highest taxed,” said Russ Lewis of Essex Physical Therapy. “Others are going up one cent and yet we are going up four cents.”
Lewis said he has had talks with town officials about the tax.
“I’ve had several discussions about what we get for this tax,” Lewis remarked. “Plus, we are not aligned with any of the other counties.”
Lewis noted that the professional fees in other localities include 19 cents in Richmond County, 50 cents in West Point, and 20 cents in Colonial Beach.
“We are clearly a lot higher than any of those,” he told Council.
Responding to Lewis’s concerns, Councilor A. Fleet Dillard III said he felt the issue was worth reviewing.
“I, as someone who works professionally, sympathizes with your argument, because I am in the same boat as you,” he told Lewis. “Nothing has been changed as these are just proposals.”
Dillard went on to say that, regarding the professional category, the proposed increase would yield $800 additional for a business with $2 million in gross receipts.
“It’s not a lot, but we’re already the highest taxed service,” Lewis responded. “When other counties around us are paying lower rates, we’re already overtaxed.”
Dillard said reviewing neighboring localities’ rates is worthwhile as is the Virginia Code which limits such taxing authority in the BPOL.
“It’s worth looking at, and hopefully we can arrive at something that is good for the town and good for the taxpayer,” Dillard remarked.
He also noted that the rates typically become effective annually on January 1.
Rob Akers of Virginia Shoe Clinic noted that he has businesses also in Kilmarnock and Fredericksburg.
“The taxes I pay here are higher than what I pay in Fredericksburg and Kilmarnock,”
Akers said. “I knew about it when I started here 10 years ago and I don’t have an issue with it, but I do take issue with raising those rates that are already higher than what’s going on elsewhere. Essentially, what you are asking me is to work harder so I can make less and you can make more. That’s the bottom line.”
Akers noted that the BPOL tax does not take into account where a business is profitable or not.
“Even if I lose $100,000, I’m still paying this amount of money,” he noted.
Moreover, he suggested that with many vacant business fronts it is not wise to raise taxes while trying to attract new commercial enterprises.
“I actually think you are at more of a risk for people leaving,” he warned. “If I move five miles into the county, I’m still going to get the same business I have now, but the town is going to lose that revenue.”
Akers also said that rates in areas such as personal property, real estate, water/ sewer, and solid waste pickup have increased in the recent past.
“How much more of a strain do we want to put on businesses that have located here and call it home,” he said. “I think the real question you need to ask is not what you stand to gain by this, but what you stand to lose. I strongly encourage you to squash this and don’t bring it up again until this town is packed full of businesses.”
Lewis Wilkins of the Tappahannock Veterinary Hospital noted that while the rate has not increased in 15 years he has annually paid a larger amount of taxes since then.
He noted he is attempting to sell his operation, but that interested parties have indicated taxation methods here are too many.
Jeff Howeth, who is a professional surveyor/engineer, echoed remarks of the previous speakers.
Howeth noted he has businesses in multiple localities including Westmoreland County where he is charged a flat rate of $35 annually for a business license.
“They don’t ask what I make,” he said. “They’ve figured it out to do it a different way.”
He also noted that the 58 cents rate is the upper limit of the BPOL for professionals.
Pollitt said a vote on the matter is expected in November or December.