That jump could end up hurting Glendale businesses over the next year, but it might be enough to motivate a surge in purchases today, particularly among “big-ticket” items like cars and large appliances, businesspeople said.
“No one wants to have this,” Judee Kendall, executive director of the Glendale Chamber of Commerce, said of the county’s soon-to-be high sales tax. “It’s added cost for everyone. But I think that there will be a bit of a rush on high-ticket items. If people are planning to buy anyway, they might do it before this kicks in.”
That sentiment has been enough to encourage more car buyers in at least one of the car dealerships in the area, which is home to a dealer from almost every major automaker, most of which are housed on Brand Boulevard.
“We’ve been awfully busy the last few days,” said Ron Smith, a sales representative at Bob Smith Toyota in La Crescenta. “People have been rushing in to make a deal before [the tax increase], but I don’t know what’s going to happen on Wednesday.”
That was the main concern for Mayor John Drayman, who expected the final day of the current sales tax rate to encourage some consumers to make major appliances before Wednesday, but was unsure what the future would bring for sellers of large items.
A 1.5% tax increase on a $30,000 car, for example, would result an $450 jump above the $2,475 in taxes that would go along with a purchase at the current rate of 8.25%.
That increase may seem small to some, but it is a sizable difference, Drayman said.
“Of course, in this economy, any increase is a consideration when people are holding onto their funds,” he said.
The burden of the county’s half-percent tax hike could be enough to influence buyers of large items to other regions, especially when cars are concerned, Drayman said.
“When we are no longer competitive here in this county, compared to other areas, a shopper that can save hundreds of dollars is going to likely go elsewhere, so I’m concerned about it,” he said.
Businesses are unsure what effect the tax hike might have on already sagging purchases, but Drayman stressed that officials should take steps to ensure that damage is not done to the car market in Glendale.
“For sure, the city should be looking at ways to promote the auto dealers anyway, because depending on the year, they are the second- or third-largest tax-revenue-generating areas for the city, and so we should be doing whatever we can to help promote and maintain.”
