Public hearing to be held for Danville's proposed meals tax increase

City Council proposing increasing tax from 6 percent to 6.5 percent

DANVILLE, Va. – When you eat at a restaurant in Danville, 6 percent of the cost of your meal is added to your bill.

That's the city's meals tax.

City Council wants to increase the tax to 6.5 percent.

A first reading and a public hearing for the proposal is scheduled to take place at Tuesday night's City Council meeting. 

Romi's Subs owner Kevin Potojecki is not in favor of the proposed tax increase.

"I'm not in favor at all. It's very unfair," Potojecki said.

A 6.5 percent meals tax is better than a 7 percent meals tax, which is what Danville City Manager Ken Larking proposed in his initial draft of the city's budget for the upcoming fiscal year.

"The work that has been done over the past several weeks on the budget has resulted in some cuts to the budget that would only necessitate a half-percent meals tax (increase) in order to have it balanced," Larking said.

Those cuts include $300,000 for blight eradication, cuts to various capital improvement projects and cuts for public works and information technology.

If the proposed meals tax increase is reduced any more, major changes would have to be made to the city's budget.

"I think cuts of that size would likely result in service reductions in some area, and a decision would have to be made about which services," Larking said.

The 6.5 percent tax is expected to generate an extra $600,000 a year for the city. The previously proposed 7 percent tax was expected to generate an extra $1.2 million a year.  

On Tuesday, 10 News visited six other restaurants besides Romis's Subs, but the managers or owners declined to be interviewed.

Potojecki said he might be willing to support a tax increase if the extra money was going to help build something.

"In big, major cities, extra food tax is for coliseums and so forth. In Danville, it's just for tax revenue. It's unfair to the people; it's unfair for the business owners," Potojecki said.

If a meals tax increase is approved, it will go into effect July 1.

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