Should we have a meals tax in Fairfax County?
On June 7, the Board of Supervisors is scheduled to vote on placing that question on the Nov. 8 election ballot. If the Board approves the referendum, then on Election Day you will be able to vote yes or no on a meals tax in our county.
The Department of Management and Budget estimates that $96 million in revenue would be generated from a 4 percent meals tax in the first year it was implemented. This estimate is based on (calendar year) 2015 taxable sales of food and drinks.
A meals tax would diversify the county’s tax revenue base. A 4 percent tax is equivalent to over 4 cents on the current (FY 2016) real estate tax rate. When the real estate tax is increased, this impacts all property-owning residents, regardless of their ability to pay. If a meals tax is approved by voters, it would apply to tourists, commuters and travelers, as well as residents who choose to dine out. For example, it’s estimated that tourists would generate $22.8 million in one year.
The Board is scheduled to vote on this proposed revenue distribution at the June 7 meeting:
Counties in Virginia, including ours, can only establish a meals tax if a referendum is approved by voters (learn more about the Dillon Rule). Examples of our neighbor jurisdictions that have a meals tax in place include:
- Alexandria: 4 percent
- Arlington: 4 percent
- Falls Church: 4 percent
- Fairfax City: 4 percent
- Herndon: 2.5 percent
- Vienna: 3 percent
- District of Columbia: 10 percent
County Executive Ed Long provided a detailed, written response to the Board of Supervisors last month: