Tax and spend

November 12, 2009
By

Brace yourselves.

Reality is hitting Chelsea and some added taxes are bound to find their way into the next city budget.

It is very likely that the city will impose a slightly higher meals tax.

This has been done in Boston.

A fractional rise in the local meals tax could net the city an estimated $60,000 a month – or a whopping annualized figure of $720,000 – more or less.

Such an increase will not empty the pockets of local residents and will be largely unfelt by those eating in Chelsea’s restaurants and food outlets.

In effect, such a rise is harmless and valuable at the same time although many of those who believe we tax and then we spend will become dispirited.

We do tend to tax and then to spend.

If this were not done here, the city would be in very bad shape.

Also being considered, I understand, is the imposition of a room tax for local hotels.

In that there is only one local hotel, I believe this applies to the Wyndham, only, although the Stanley Hotel might also qualify as well as other rooming houses operating in the city with lodging house licenses.

The Wyndham has 185 rooms.

Assuming 100 of those rooms are rented daily – which is not a bad assumption – and a room tax of $5 -$6 dollars is imposed by the city, which is to say, everyone renting a room in the hotel is made to pay a hotel tax in addition to all other charges and preexisting state taxes, has the potential of adding another $200,000, more or less, to the city treasury in a twelve month period.

So it appears that meals tax plus room tax equals almost $1 million in additional revenue for the city.

In this down economy, the city more than before needs new revenue in order to ride out the economic storm.

While some will fight against the meals and room tax in the belief they are odious, main stream Chelsea leaders will understand the need for additional revenues.

The city manager hasn’t yet made his position known in the matter.

We can only assume he will favor such taxes and will urge the city council to approve them.


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