High Hill residents will vote on whether a local use tax should be at the same rate as the total local sales tax rate in the August 4 primary election.

The High Hill Board of Aldermen voted at its meeting on April 13 to place the one percent use tax measure on the ballot. A use tax is a local tax that is applied to goods that are purchased from out-of-state sources, such as online transactions, that are delivered to and utilized within the City of High Hill.

“This is the same ordinance that we passed last year, but it didn’t get taken to the (Montgomery County) Clerk’s Office so it could get on the ballot,” High Hill Mayor Tom Stine said. “So we have to repass the ordinance so we can get it to the clerk’s office and get it on the next ballot.”

When Missouri residents make online purchases, they pay no sales tax to the city they live in, but they pay sales tax to the state. In a use tax, local and out-of-state businesses collect the same tax rate.

Stine said the city doesn’t get any revenue from internet sales.

“If you buy something from Amazon, you pay tax on it based on that tax to the state,” he said. “The state sends a portion of the tax to Montgomery County. Montgomery County sends the portion of the tax to High Hill. Everybody gets their piece of the pie and we get what’s left.”

A public hearing was held during the city’s proposal of placing the use tax measure on the primary ballot. No one spoke at the meeting.

High Hill Alderman Jay Hardin presented the county budget at the meeting to show that more people are buying more online. The county’s projected use tax for 2026 is $800,000. Its use tax last year was $754,209.29.

“So far this year, they’re in the red at $18,000 in collected sales taxes, but at the same time, the use tax is going up,” Hardin said. “So you can see where people are moving away from buying at the local stores and more online.”

Two other cities in the county — Montgomery City and New Florence — have implemented a use tax. In 2022, Montgomery City voters approved a use tax. The city received between $30,000 to $50,000 in annual revenue. Last year, New Florence residents approved their use tax measure, also known as Proposition U.