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Jeff Branscome writes about Spotsylvania County.

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Giving small business a break

Spotsylvania County will see $29,400 less in business license tax revenue as a result of a decision supervisors made at their last meeting.

The day supervisors approved the budget earlier this year in a flurry of confusing votes and changes that one would see at an auction, not a public meeting, Supervisor Jerry Logan asked that the BPOL Tax threshold on gross receipts be increased from $100,000 to $200,000. The proposal came out of nowhere, but Logan gave great detail at the time about why he was asking for this: small businesses are hurt by this tax and they need all the support they can get.

Any business that has gross receipts of $199,999 or less does not have to pay the BPOL Tax. The actual loss in revenue is $61,000. But a $50,000 exemption was also removed for businesses that exceed $1 million, which helped erase the deficit by $36,000. Logan, who has a family-operated electric business, abstained from voting because of the perception of a conflict of interest. The vote was 6-0.

I called Supervisor Logan today and he said some people believe the BPOL Tax is egregious. He’s not a fan of it, and in 1996 he was part of a majority on the county board that created the original $100,000 threshold. Well, the economy has changed.  

“The problem with the BPOL Tax is it taxes the gross revenues of the business,” and not profits, Logan said. So, even businesses that are losing money still pay this tax.  ”When a business is struggling to keep its doors open and having a horrendous year I just don’t think it’s right to hit them with a BPOL Tax.”

Why did he abstain from the vote? Logan’s business, which grosses more than $1 million a year, is affected by the change, but not by much. Chris Yakabouski also is part of a family-owned business, but it’s been under the threshold mark, and has never had to pay the BPOL rate.

“The majority of the businesses in Spotsylvania County are the ones I am trying to help,” Logan said. “It is going to help literally thousands of family-owned businesses.”

Here are the rates for the business license:

BUSINESS LICENSE TAX RATE CHART

 DESCRIPTION

 PER
$100 

AM

 AMUSEMENTS

 0.18

BS

 BUSINESS SERVICES

 0.18

CN

 CONTRACTORS

 0.08

DR

 DIRECT SELLERS

 0.10

DV

 DEVELOPERS

 0.18

IM

 ITINERANT MERCHANTS & PEDDLERS

 0.10

ML

 MISCELLANEOUS

 0.18

OC

 OUT OF AREA CONTRACTORS

 0.08

PF

 PROFESSIONALS

 0.29

PH

 PHOTOGRAPHERS

 0.18

PS

 PERSONAL SERVICES

 0.18

RM

 RETAIL MERCHANTS

 0.10

RN

 RENTALS

 0.18

RS

 REPAIR SERVICES

 0.18

WM

 WHOLESALE MERCHANTS (gross purchases)

 0.025

Permalink: http://news.fredericksburg.com/spotsygovt/2007/11/20/giving-small-business-a-break/

  • wizard1073

    The exemption amount is $50,000, meaning that if I make 99,999, I pay nothing, and 100,000 leads to tax payment on $50,000 of revenue. If the exemption did not increase, then it will not help any businesses over the new threshold. Mine grosses $500,000 per year, but my expenses are almost the same!!!

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