Public Information Concerning 1/4 Cent Sales Tax
Referendum on Nov. 8th 2016 Ballot
What can 1/4 of a Penny do?
Where Will the Money Go ?
All Money Goes to Public Safety Agencies in Cleveland County
How Much Will This Cost Me ?
In North Carolina, 30 counties have approved the ¼ cent sales tax referendum. Cleveland County’s current sales tax is 6.75%. If approved by voters in November, the sales tax will be 7.00%. When you shop in Cleveland County, you would pay an additional penny for every four-dollar purchase.
Here’s some sample tax impact calculations. Please note, tax does not apply to Gas or Unprepared Food (Groceries).
Purchase of $100
$100 x 0.0025 = 25 Cents
Purchase of $300
$300 x 0.0025 = 75 Cents
Purchase of $500
$500 x 0.0025 = $1.25
Frequently Asked Questions
Click on questions to reveal answers.
What is the current sales tax rate for Cleveland County?
The current sales tax rate for Cleveland County is 6.75%. If approved, the sales tax rate would be 7.0%.
Who put this issue on the ballot?
In 2007, the NC General Assembly granted county boards of commissioners the authority to levy, subject to voter approval, an additional .25% county sales and use tax. On June 21, 2016, the Cleveland County Board of Commissioners approved a resolution calling for a November 8, 2016 Special Advisory Referendum concerning the levy of .25% county sales and use tax.
What will these funds be used for?
The Board of Commissioners resolved to designate funds raised through the .25% sales and use tax be used to support Volunteer Fire Departments, the Sheriff's Office, Emergency Medical Services, Public Safety Capital Reserve, and Municipal Public Safety Agencies in Cleveland County.
How much money will be raised through this tax?
Cleveland County Government estimates, based on current sales tax figures, that the .25% sales and use tax would generate approximately $1,600,000 annually.
How much will the sales and use tax impact purchases by an individual?
The additional .25% sales and use tax will cost one penny for every four dollar purchase. Exemptions from the tax include gas purchases and unprepared food. This tax will apply to all persons shopping in Cleveland County, not just county residents.
Are there items exempt from the sales tax?
Yes, the tax will not be applied to gas purchases or unprepared food (i.e. groceries). For a full listing, see North Carolina General Statute 105-164.13
Has the sales tax referendum been on ballots in other counties?
Yes, since the legislature granted counties authority to seek voter approval, many counties have placed the referendum on a local ballot. Some of the surrounding and nearby counties include, Catawba, Alamance, Lincoln, Gaston and Rutherford. There are 30 NC Counties authorized to levy the additional .25%.
How does this compare to property taxes?
One penny in Cleveland County property tax raises approximately $800,000.
One-fourth of a penny in sales tax is projected to raise approximately $1,600,000.
If the sales tax passes does it mean property taxes will not be increased?
The sales tax lessens the pressure on property tax. A strategic goal of Cleveland County Commissioners for several years has been to “Seek alternatives for increasing revenues to lessen the county’s burden on property taxes.”
How is a sales tax different from property tax?
Property taxes are assessed based on property ownership. Sales taxes are consumption based taxes. Keeping property taxes low can help encourage economic development. Sales taxes are generated from monetary transactions. Tourists and visitors to Cleveland County help support county services through sales tax dollars.
What will I see on the ballot?
The form of the ballot question for the additional 0.25% sales tax is mandated by NC General Statute 105-537(c)
. Please see below:
[ ] FOR [ ] AGAINST
Local sales and use tax at the rate of one-quarter percent (.25%) in addition to all other State and local sales and use tax.
When is the earliest the sales tax will become effective if the Board of Commissioners levies the sales tax via resolution following a successful referendum?
The sales tax may become effective on the first day of any calendar quarter so long as the county gives the Secretary of Revenue at least 90 days advance notice. For example, if a referendum is held in November during the general election and passes, the county could begin collecting the tax on April 1 of the following year, provided it adopts a resolution levying the tax and forwards it to the Department of Revenue prior to December 31.
Are there restrictions on the use of the revenues?
No. The sales tax is not restricted or earmarked and can therefore be used for any allowed use by counties. As a reminder, Cleveland County adopted a resolution designating all funds from this tax to be used solely for public safety.
If the referendum fails, can a county hold a subsequent referendum on the same question?
There are no restrictions on resubmitting the sales tax option to the voters again after an unsuccessful referendum.
Can a county spend public money educating citizens on issues related to the referendum?
Yes. Similar to an election for a general obligation bond, a county may spend money to educate the public on issues related to the sales tax referendum. However, a county may not spend money advocating for or against the sales tax.
Can members of a county board of commissioners actively promote the passage of the referendum?
Yes. The Board of Commissioners may approve resolutions in support of the passage of a referendum for the sales tax. A County Commissioner may publicly endorse and support the sales tax. A county may not reimburse any expenses incurred by an elected official while the official is advocating either for or against the tax measure.
Does the sales tax apply to unprepared food or gas?
The local-option sales tax does not apply to unprepared food (i.e. groceries) or gas purchases. There is no local sales tax on gas purchases.