A transaction fee? Really?

There certainly aren’t many options for the city of Kalispell to raise money, and there certainly is a need for improved roads and infrastructure.

But the idea of a city “transaction fee” seems to be plagued with problems that would exceed any benefits.

The city does have a dilemma, with an annual road budget of $1.75 million that already relies heavily on property taxes and an estimated need of $4 million to $4.5 million for adequate improvements to roads such as the disaster zones known as Stillwater Road and Fourth Avenue East.

But a 5-cent transaction fee to pay for it all? Make no mistake, it is a tax, and it’s not a sales tax only because it’s not based on a percentage of sales value.

For starters, city officials should expect a hostile reaction from merchants who don’t care to be enlisted as tax collectors. While they certainly track revenue, we have to wonder if businesses actually keep track of each and every transaction, and just what kind of burden it would be to start doing so.

From a consumer standpoint, there couldn’t be a more regressive tax. A 5-cent tax on every transaction would amount to a 5-cent tax on a can of pop just as it would be a 5-cent tax on a $30,000 car.

Don’t get us wrong. We’ve supported giving municipalities the option to impose a local-option tax, preferably as supported by voters, but this idea is something entirely different.

No doubt Kalispell officials are envious of the success of the voter-approved Whitefish resort tax, which has yielded benefits in terms of infrastructure improvements and has effectively captured visitor dollars.

But that option is not available in Kalispell, and besides, the Whitefish tax was crafted with exemptions for food and other staple items.

We doubt that voters would ever approve the transaction fee, but if Kalispell city officials hope to win support for it, their study group should be striving for one that is very carefully designed. Even then, it will be an uphill battle in a community and a state that has a long history of resisting anything resembling a sales tax.