The occupational tax, or license fees, on employers and employees who have a business or work inside Clinton County has been around for 15 years. However, many of the businesses and individuals who, by statute, are required to pay the tax to the county aren’t doing so–and some are apparently still even unaware they have to, according to Occupational Tax Administrator Virginia Conner.

The tax was originally adopted at three quarters (0.75) of one percent on revenue in 1999 and includes businesses that operate in Clinton County, employees who work for those businesses and individuals, such as farmers, ranchers, etc.

But somewhat surprisingly, Conner estimates that only 40 percent, or two in five of those required to pay the local tax are actually doing so. And, she says there are more individuals than businesses who are delinquent in paying.

The local tax was a controversy when passed and although it goes into the county’s general fund to help pay for several services, the primary stated intent when originally passed was to help fund the local ambulance service.

Conner said that well over $200,000 is generated annually by the occupational tax.

However, with the percent of delinquencies or those not paying, the other side of that shows the county is losing over a very substantial amount every year in tax revenue.

Conner said she began looking closely at the list of businesses and individuals required to pay the tax and really began looking at ways of trying to get delinquent taxes collected and also to make people, especially new businesses, aware of the local tax. She also said she had been sharing lists of local residents with other counties, including working with the Corps of Engineers to make people aware of the three-quarter percent tax that should be withheld by employers.

Conner said she was trying to make contact with all new businesses that come into the county and is currently looking through the list to find businesses and individuals that are not paying. She also noted that some people may operate two or more businesses, but are only paying on one.

“I have been making a lot of phone calls and trips and County Attorney Michael Rains is also sending out delinquent tax notice letters,” Conner said. “We’ve also discussed advertising the issue on the local TV access channel and doing other promotionals. A packet explaining the occupational tax is also being given businesses and individuals who are required to pay it.

Conner is aware that collecting delinquent taxes or, in some case, any of the taxes won’t be an easy task as she noted some people have already indicated to her they feel like they are paying too many taxes already. “A lot of people don’t understand the (occupational) tax and still others aren’t even aware of it,” she added.

“We are going to work with the county attorney and ask businesses and individuals to comply and start paying,” she said.

The penalties for not paying include the possibility of being taken to civil court and ordered to pay up to five years back taxes.

According to the revised Occupational License Fee ordinance filed in 2008, a couple of parts of the ordinance need to be noted, as follows:

* Occupational License Application Requires: (1) Every person or business entity engaged in any trade, occupation, or profession, or other activity for profit or anyone required to file a return under this ordinance in Clinton County shall be required to complete and execute the questionnaire prescribed by the Occupational Tax Office. Each person shall be required to complete a separate questionnaire for each separate business before the commencement of business or in the event of a status change, other than change of address. Licenses are required to notify the Occupational Tax Office of changes of address, or the cessation of business activity, and of other changes which render inaccurate the information supplied in the completed questionnaire.

KRS 67.755: (5) Any business entity that fails to submit the minimum quarterly payment required under subsection (4) of this section by the due date for the quarterly payment shall pay an amount equal to twelve percent (12 percent) per annum simple interest on the amount of the quarterly payment required under subsection (4) this section from the earlier of: (a) The due date for the quarterly payment until the time when the aggregate quarterly payments submitted for the taxable year equal the minimum aggregate payments due under subsection (4) of this section.

A copy of the full text of the Occupational License Tax ordinance is available at the tax administrator’s office located in the county judge/executive’s office. Anyone with questions or needing more information should contact OTA Conner at 387-6409.