Two Percent Tax Doesn't Seem Equal To Some Restaurant Owners

OCEAN SPRINGS (WLOX) -- Customers craving ice cream stop at the Corner Cafe & Bakery in Ocean Springs. Or, they can walk through a makeshift doorway, to satisfy their sweet tooth at the connecting gas station. The only difference between the two is a two percent tax levied at what Ocean Springs considers a 'restaurant.'

"We've had a few customers complain. The price of my same exact items that they sell next door, mine are a little bit higher than they are next door," café owner Deadra Baldwin says.

Baldwin sells the same sodas and sandwiches as the quick stop. But at gas stations and grocery stores in Ocean Springs, customers don't pay the tax.

"All of my soft drinks, any of the breakfast sandwiches I do, my plate lunches. You can go down to Winn Dixie, Wal-Mart, or Broome's and you can get a plate lunch with similar food items that I have. You'll pay a tax here, but you drive down the road, you won't pay a tax there," Baldwin says.

Baldwin says the "2 cent tax" will add up to more than $150 in accountant fees per month. It will also make that morning muffin a little pricier.

"In the end, they're going to pay more than that, because prices have to go up for that to keep up with the accounting, the bookkeeping to keep up with that," Baldwin says.

Ocean Springs Aldermen considered asking the legislature to revise the levy to apply to all businesses that sell prepared food. But a new bill would require voters to go back to the polls for approval.

"If we do this, we would jeopardize what we have, and the ball has already started rolling," Ward 4 Alderman Greg Denyer said.

So Baldwin and other restaurateurs will have to keep on cooking, hoping their customers won't mind bringing some extra change.

Alderman Matt McDonnell says the issue also is too late to be considered in the 2008 legislative session, but the city could possibly re-examine the tax next year. At that point, they will also have a better idea of how much revenue the tax will generate.