City Tells Businesses to Continue Collecting Sales Taxes, But Retain Them to Help with Cash Flow

To help businesses struggling from the unexpected drop in sales caused by the new coronavirus (COVID-19), the town of Vail, Colorado, has suspended sales tax collections.

Vail businesses will continue to collect sales tax from customers and file sales tax returns as usual. However, they can retain the tax collected for the time being, to help with cash flow. The current online filing and payment system allows for taxpayers to file without paying.

The Vail Town Council decided to defer Town of Vail sales tax payments “to provide immediate relief to our business community.” It’s unclear at this time how long sales tax payments will be suspended. For now, the Town Council says it will be “for a period of time.” Councilmember Jenn Bruno believes it could be as late as July.

According to Vail Finance Director Kathleen Halloran, sales tax collections for March and April are projected to drop by approximately 50%. Though a deep base and sunny skies typically draw big crowds to the slopes each spring, that’s not the case this year. On Friday, March 20, the ski lifts will stop running because of COVID-19.

Like a growing number of places in the world, Colorado has closed bars, restaurants, gyms, theaters, and casinos to “ingress, egress, use, and occupancy by members of the public.” Businesses that sell food and beverage may continue to do so using delivery or take-out service. Convenience and grocery stores, food pantries, pharmacies, and retail shops remain open for business as usual, though there’s nothing usual about the situation today.

As the COVID-19 pandemic continues, it will be interesting to see if other communities or states follow Vail’s lead.

Sales Tax