Ontario is the only Oregon city that will have a retail sales tax, after the City Council approved a 1 percent general sales tax Tuesday.
City leaders estimate it will generate $3.7 million each year toward the city’s $26 million annual budget. Ontario will use the revenue to fund street repairs, law enforcement, parks and other city services.
Two other Oregon cities — Ashland and Yachats — have sales taxes on food and beverages, but no other Oregon city imposes a general sales tax.
Since Ontario is situated on the Idaho-Oregon border, the community sees a lot of shoppers who come across state lines to avoid Idaho’s 6 percent sales tax.
City staff estimate about 11,000 people live in Ontario, but around 20,000 come to town to shop everyday. Those visitors cost the city for road maintenance, policing and other infrastructure.
Ontario Mayor Ron Verini believes the tax is small enough it won’t make a huge difference for shoppers.
“What we’re talking about here is 1 cent — 1 percent,” Verini said. “You know, a person would have to spend $10,000 to pay approximately $100 in taxes.”
The tax is slated to take effect next year, but could be overturned through a voter referendum. Some residents plan to start a petition to refer the tax to voters in next May’s election.
“I’m anticipating that this will end up on a ballot,” said Scott Marlin, an Ontario resident who opposes the sales tax. “Personally, I hope the City Council isn’t all in on this. I hope they have a backup plan.”
Ontario voters have rejected a sales tax in all nine statewide ballot initiatives over the past three decades.