Proposed Tax on Businesses in Dewey Beach - WBOC-TV 16, Delmarvas News Leader, FOX 21 -

Proposed Tax on Businesses in Dewey Beach

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DEWEY BEACH, Del.- Town officials in Dewey Beach are exploring the option of an annual gross receipts tax from businesses to raise revenues for the town.

Tourism is the driving force behind the economy in Dewey Beach.  Both businesses and the town itself generate their income during the summer months.  However, the town is in need of more revenue and may turn to the businesses for help by way of another tax.  Eric Shindledecker is the owner of Sharky's Grill and says he cannot afford another tax.

"My operation is a day-time operation.  We run from about 7 in the morning until about 3 in the afternoon.  I don't have alcohol to sell so I am on a very thin profit margin.  If this legislation passes, it's probably going to put me out of business," said Shindeldecker.

Dewey Beach in considering an annual gross receipts tax on businesses anywhere higher than zero but lower than three percent.  There would be an exemption on the first 100 to 250 thousand dollars of revenue.  The money would be used to pay for town services like the police force that grows in size and is used a great deal during the summer months.

"As one of our commissioners says, you know, we'd like to see Dewey remain a part town but we'd like to see, basically the people who benefit from the party paying for the party and so that's kind of the motivation that's driving this," said Town Commissioner, Courtney Riordan.

Dewey Beach is facing a structural deficit of a few hundred thousand dollars which is why the extra tax may be needed.  But rather tan taxing businesses, some have other ideas.    

"I think we need to explore a property tax.  The town needs a stable source of revenue so that our business that we do has a predictable path," said Shindledecker.

Town officials say they plan to work with businesses on an affordable rate for the tax.  Officials hope that if the law passes, the tax will be in place by 2014.

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