City council nixes request to collect coin-op taxes in Aurora

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AURORA | The City of Aurora will not start collecting a controversial sales tax from coin-operated laundromats and self-service car washes after all, city lawmakers agreed at a study session Monday night.

“This is really taxing the poor,” said Aurora City Councilwoman Sally Mounier, one of five council members who voted against enforcing a long-overlooked portion of Aurora’s tax code that allows the city to collect a 3.75 percent sales tax on coin-operated businesses. 

According to city staff, implementing the tax would have provided city coffers with $300,000 in new revenue and would have been applied to an estimated 22 laundromats, 16 self-service car washes, 24 in-bay car washes and a handful of coin-operated massage chairs across Aurora.

“For a city the size of Aurora, the $300,000 we’re going to potentially gain, we’ve seen ill-will and the backlash on this that’s worth more than $300,000,” said Aurora Councilman Bob Roth, who opposes the tax. Council members Bob Broom and Renie Peterson voted to enforce the tax. Council members Marsha Berzins and Bob LeGare were absent from the vote.

“We collect more than two thirds of our budget from sales tax. We can’t pick and choose who we’re going to tax,” Broom said. 

A flurry of recent case law involving successful arguments in favor of similar coin-operated tax requirements in Glendale, Commerce City, Westminster and other metro municipalities, led the tax and licensing division to recommend beginning to collect the tax this summer.

Aurora City Attorney Mike Hyman said since the taxing of the businesses was already part of the tax code, legislation would have to be crafted to exempt the businesses from the tax. He said that issue would need to go back to the city’s Management and Finance Committee.

The potential change would not affect state sales tax, as Colorado exempts the rental of short-term services from paying sales tax. That is not the case within Aurora, however. Trevor Vaughn, manager of the city’s tax and licensing division, said that it is not uncommon for state and city tax codes to differ in terms of minute exemptions. He said the only way these businesses now pay the state is through taxes on vended items on-site such as detergent and other cleaning supplies.

Staff Writer Quincy Snowdon contributed to this story.

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Joe Hardhat
Joe Hardhat
6 years ago

Who says you can’t beat city hall. The tax fiends in city council have met their match!

gofastgo
gofastgo
6 years ago
Reply to  Joe Hardhat

These owners need to pay their taxes, no matter the push back.

Bronson
Bronson
6 years ago
Reply to  gofastgo

gofastgo, are you aware of how this tax rate is collected and paid? This is not taxing the business owner but rather the transaction of every customer. The customer picks up the tap per every transaction not the business owner; this is not an income tax; this is sales tax and WE as consumers, pay that tax.

gofastgo
gofastgo
6 years ago
Reply to  Bronson

I see. Then I’m against it too, if the owner is already paying income tax, I’m against any more ‘sales taxes’ in this city. I paid a tax once in a Sprouts market and asked what it was, and it was a ‘use tax’ for Aurora, enough already.

Scooter
Scooter
6 years ago
Reply to  gofastgo

The Sprouts payment was a fee and not a tax. The fee went to the developer of the shopping center.

gofastgo
gofastgo
6 years ago
Reply to  Scooter

Then my next question would be, ‘why’? Private enterprise gets many breaks from cities and municipalities, and then on top of that a ‘fee’? Politics.

neely
neely
6 years ago
Reply to  gofastgo

Happy that Bob Broom is term limited – he won’t be running again. Good riddance.

Eric
Eric
6 years ago
Reply to  gofastgo

The owners are paying state and federal income tax, not to mention real estate tax, personal property tax, and matching payroll taxes for their employees. The sales tax is something that should only be charged to non service businesses, i.e. sales of tangible personal property. If you can’t hold it in your hand, it normally isn’t subject to sales tax. It is the consumer who pays the sales tax, but in this case it is impossible to collect when car washes and laundry mats only accept coins in 25c increments. Congratulations to city council for making the right call!

ReneeWShaw
ReneeWShaw
6 years ago

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gofastgo
gofastgo
6 years ago

Why would the owners of these businesses be exempt from taxation on profits? They make money, they pay taxes, easy peasy.