SALES TAX REVENUE

Distribution: General Fund 83%

Parks and Recreation Fund 17%

Source: Visitors and residents in Parker

Collection: In 1981, the citizens of Parker voted to implement a 1% sales and use tax, and voters increased the rate to 2.5% in 1982. In 1984, Parker became a home rule municipality with power to self-govern in matters of local and municipal concern. In 1990, the citizens voted to increase the sales tax rate to the current level of 3%, with the added .5% to be earmarked for parks and recreation improvements. Sales tax is charged on certain services and all retail purchases.

As a home rule Town, Parker collects and administers its own sales and use tax. In late 2020, the Town signed an intergovernmental agreement with the State of Colorado that enables the Town to collect sales tax through their portal as well. This has increased the level of collections from market place facilitators.

Businesses remit tax to Parker monthly, quarterly or annually. Taxes collected are remitted to the Town by the 20th of the month following collection, either online or through a lockbox. The Town uses a number of enforcement tools to collect from delinquent accounts including taxpayer education, delinquency notices, personal phone contact and visits, audits, summons to municipal court and seizures.

Trend:

• The sales tax growth rate has been increasing since 2018 reflecting steady population and business growth in the Town.

• In late 2020, Town Council amended the Town charter to broaden the e-commerce tax base, which continues to positively impact collections.

• The spike in collections in 2021 is due to a combination of factors, including people shopping close to home due to COVID-19, an increase in spending as businesses opened back up, and pandemic-related cash aid from federal and state governments.

Sales Tax Audit Revenue

Distribution: General Fund 83%

Parks and Recreation Fund 17%

Source: Parker businesses and construction companies with construction projects in Parker

Collection: The Town’s audit program emphasizes taxpayer education and voluntary compliance. The Town works with businesses which are delinquent or not remitting taxes to educate them on the correct way to calculate and remit sales and use tax. An audit may take two hours or several months to perform, depending on the complexity of the organization. Once the Town completes an audit, it meets with the taxpayer to go over the audit assessment and make any appropriate adjustments or corrections. The taxpayer then has 30 days to pay the assessment, work out a settlement or payment plan, or protest the assessment. The Town collects assessments through the Finance Department.

Trend:

• Audit revenues fluctuate based on the size and number of audits.