A local meals tax is already in place in many surrounding communities, including Newburyport and Haverhill, which each approved adding their own 0.75 percent local meals tax in 2010. According to the state Department of Revenue, every city in Essex County has a local meals tax except for Amesbury and Lynn, which is also currently weighing whether to introduce one, Scorzoni said.
The combined tax would also be lower than New Hampshire’s 9 percent state meals and rental tax, keeping Amesbury at a competitive advantage over border communities like Seabrook.
Despite these facts, several councilors weren’t ready to embrace the proposal.
Beyond the basic hesitation to establish a new tax in the current political climate, some councilors also raised concerns about there being no guarantee that the local meals tax revenue would be used for its stated purpose.
Kelcourse, for instance, pointed out that the revenue couldn’t go directly into the new stabilization account and would have to go into the city’s general fund first.
Once in the general fund, it would be up to the mayor to ask the City Council to appropriate the money into the stabilization fund, and that would have to be done every year, Kelcourse said.
Kelcourse said his concern is that down the road, when there is a different mayor and City Council in place, the money could wind up being used for anything.
Scorzoni acknowledged that the funds would have to be appropriated, but argued that by creating the tax and the stabilization fund in the same bill, it would establish intent for how the council wants the revenue to be used.
“This is similar to what happened with our ambulance receipts,” Scorzoni said. “Technically, we could divert money from that stabilization fund to other purposes, but by tradition and precedent, we use those funds specifically for that purpose.”
Scorzoni added that he would work with Mayor Thatcher Kezer, Chief Financial Officer Mike Basque and others to tighten up the bill’s language and help make sure that the intent was as clear as possible.