The City of Lincoln today reminded residents that Lincoln's sales and use tax rate will increase from 1.5 percent to 1.75 percent beginning October 1. The current state sales and use tax rate is 5.5 percent, so the total sales and use tax rate will increase from 7 percent to 7.25 percent.
Lincoln voters approved the 1/4-cent increase in April to support two important public safety projects: replacement of the City's emergency 911 radio system and the construction and/or relocation of four fire stations. One will be a joint police and fire station. The sales and use tax rate increase will be in effect for three years, and any extension of the increase would need to be approved by voters.
"I want to again thank the members of the citizen committee who studied all the options for funding these important projects as well as the voters who gave us their approval," said Mayor Chris Beutler. "These projects will ensure the reliability of emergency communications for first responders and provide improved coverage and response times for a growing community."
More information for consumers, retailers and others who hold sales and use tax permits is available at lincoln.ne.gov (keyword: sales tax). The website includes a link to sales and use tax information from the Nebraska Department of Revenue, which offers a very helpful subscription service for email notifications about sales and use tax and other topics
The 13-member citizen committee unanimously recommended the sales and use tax rate increase over seven other options. Long-term financing would have led to millions of dollars in interest expenses, while a sales and use tax increase spreads the cost over everyone who buys goods and services in Lincoln, including people who live outside the City and visitors, who also use emergency services.
Revenue from the sales and use tax increase will be received beginning in December 2015. A monthly report of revenue from the sales and use tax increase and expenses related to the public safety projects will be provided on the website beginning that month, and it will be updated with running totals. The ballot issue approved by voters establishes a citizen oversight committee to monitor these projects. The agenda and minutes of meetings will also be posted online as they become available.