Saturday, September 29, 2012

Proponents of Wood River LOT Promise Revenues, Opponents Worry About New Tax Hurting Sales

Posted By on Sat, Sep 29, 2012 at 3:00 PM

While promoters of a proposed new local-option tax in the Wood River Valley promise that additional commercial air traffic translates into more business, some retailers worry that a higher tax will actually push business away.

The Idaho Mountain Express reports that the Fly Sun Valley Alliance said that two to three new flights into Friedman Memorial Airport could rack up $40 million in new revenues. The proposed LOT, which voters will decide on this November, is designed to provide financial incentives for commercial airlines to increase service to the Sun Valley area.

But some Sun Valley businesses point to what they think is an already high 8-percent tax on goods: 6 percent sales sales and a 2 percent local-option tax. Meanwhile the city of Hailey doesn't charge the current LOT.

“I used to have a real good clientele out of Hailey,” jewelry shop owner Tom Keenan told the Idaho Mountain Express. “I think people look and say, ‘I can pay 8 percent or I can pay 6 percent.' While I understand the need for the LOT, I don’t like the inequality of the current LOT."

Proponents say that tourists in the Sun Valley area that arrive by air spend roughly $1,700 per visit. They say that additional flights could bring in 30 passengers from San Francisco, 19 passengers from Denver and as many as 35 passengers from New York City per day.

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