Wednesday, April 25, 2012

"Rentals Tax" Proposal Passes Town Meeting

Above, a Wellfleet beach in summer, full of summer visitors. Readers requested that I write about the proposal for a “rentals tax” article on the Town Warrant, so here's a summary ...

Yesterday evening, Selectman Paul Pilcher explained Article 20 would give the town the authority to impose a tax if approved by the legislature. The tax would be from 1 to 5%. The renter would assume this tax, not the person renting. He said that last year 5000 beach stickers were sold for one or two week stays in peak season. Eastham, Brewster, and Provincetown have already submitted similar requests to the legislature. The town needs a new source of revenue. Taxing summer visitors seems to make sense since they use services provided by the town. The tax percentage would be decided at a future Town Meeting. There ensued a long discussion. I will simply supply a brief summary of the varying points-of-view …

Selectwoman Berta Bruinooge reported having done some research. "Rental income is a significant business,” she declared. Online, there were 236 rentals listed in Wellfleet the week she looked. Three were over $8000 per week. Twenty-two cost between $5000 and $8000. 84 cost between $2500 and $4999. 111 cost between $1000 and $2499. There were only sixteen under $1000.

Ben Zehnder said he was concerned about the details of collection. The response was that the property owner would collect the tax and submit it to the town.

Manny Smith spoke in favor. “Tourists put a huge burden on Wellfleet,” he said. “Tourists are not paying their fair share. The average tourist is better off than the average Wellfleetian. This is not a tax on Wellfleet homeowners.”

Curt Felix said he was “opposed very strongly” and added, “It’s a false economy we have here in tourism land.” He also pointed out that the burden would be on people who rent for less than $2000 and suggested Wellfleet try to control spending instead.

John Wolf pointed out that not every landlord would be able to pass the tax on to renters, that some people rent rooms to those who work in the town over the summer.

Nate Johnson suggested tightening the budget instead. He stated that friends came to visit in August and found Wellfleet expensive already.

Brent Harold said that market determines price, so landlords could not simply add it on and assume it would make no difference to a rental business.

Berta Bruinooge pleaded, “This is a pill we need to swallow.”

Janet Lowenstein said, “I ran a B&B for 11 years and a weekly rental cottage. I collected room tax. It didn’t come out of my pocket. In 11 years, not once did anyone refuse to come because of the tax.”

Article 20 passed. How do you feel about it?