Utah debacle shows grocery tax’s unpopularity

Utah debacle shows grocery tax’s unpopularity

by
Idaho Freedom Foundation staff
February 19, 2020
Idaho Freedom Foundation staff
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February 19, 2020

By Bryan Smith | Idaho Freedom Foundation Board Member

Utah legislators recently learned an important lesson: People don’t like tax hikes on their milk, cheese, bacon and butter.

Idaho lawmakers should learn from Utah’s experience. I fear they won’t.

Allow me to recap the story. Late last year, Utah Republicans built a tax reform proposal they said would be good for the state’s economy. Among the changes were cuts to income tax rates for all earners, increased taxes on gasoline and some services, and higher taxes on groceries.

The measure, passed in special session last December, increased Utah’s grocery sales tax from 1.75% to 4.85% — a 177% increase. The law also gave a meager $200 grocery tax credit to families with dependents at home.

The backlash was fierce and immediate. Activists, focused on the food tax hike, sprang to action, launched an all-volunteer petition drive to put the tax law on the ballot and gathered thousands of signatures. In late January, petitioners turned in their signatures, the state-certified the referendum, and Utahans were set to vote on the tax law in November.

However, that vote won’t happen, as Utah lawmakers reversed course. They opened their session and quickly repealed the unpopular bill.

The people triumphed.

A recent Bee Hive State poll reveals the law’s deep unpopularity among Utahns. Conducted by Rasmussen, the poll found that among 1,017 Utahns surveyed, roughly 68% of respondents disapproved of the tax package. Just 12% of respondents favored it.

Utahns’ anger may have subsided, but the ripple effects of this disaster could continue for months. A number of activists have declared their intentions to run for office and unseat lawmakers who supported the measure. And the issue could come up as Utahns select a new governor this year.

This begs the question: Are Idaho lawmakers watching?

For years, true conservatives have tried to repeal Idaho’s 6% grocery tax. This year is no different. Rep. Priscilla Giddings, R-Whitebird, tried to introduce a repeal measure last month but was rebuffed. Her bill, sadly, doesn’t have House leadership’s support.

Signs of support among a broad swath of Idaho are all over: Progressive Democrats speak in favor of full repeal. Republicans love repeal so much they enshrined their dedication to it in their party platform.

Pro-grocery tax repeal advocates saw a glimmer of hope in 2019 when Idaho Gov. Brad Little promised repeal during the 2020 session. Yet Little whiffed in this year’s State of the State address. He didn’t demand repeal but committed $35 million to grocery tax relief and merely gave lawmakers a vague suggestion to do something with the funds.

Grocery tax repeal is good for Idahoans who need relief when they need it — at the cash register. It’s good for small businesses in our border communities who lose customers to tax-free states. And it’s good for government, which processes thousands of state income tax forms annually for people who file only to receive their tax credit.

Unfortunately, Idaho didn’t learn anything from the Utah debacle. Last week, Idaho legislators rejected efforts to repeal the grocery sales tax repeal when real reform died in the House Revenue Committee.

Are we Idahoans as outraged as our southern neighbors?

Note: The Post Register first published this column.

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