Leaders say food tax hike appears dead
An effort to double the state's sales tax on food is apparently dead for the year.
"I think that's not going to be addressed this session," Senate President Wayne Niederhauser, R-Sandy, told reporters Friday.
"The House doesn't seem to be in favor of it, so we're wondering why we should spent a lot of energy if it's just going to die over in the House," he said, noting that is what happened last year.
Agreeing with him is Sen. John Valentine, R-Provo, who planned to sponsor a bill to increase the tax. "If one of the bodies is not in favor, it makes no sense to try to move this," he said. "I do not want this just to be a statement bill, I want to do it because we need to stabilize the structure" of the tax system.
In 2006 and 2007, Utah's sales tax on food was cut in steps from 4.75 percent to 1.75 percent, a major initiative backed by then-Gov. Jon Huntsman, who said it would help working families and the poor.
However, Valentine and allies say that also made revenues from remaining sales tax more volatile, and they plummeted when the recession hit making it hard to fund government. Some lawmakers argued that raising tax again on food would make revenues more stable in bad times Â because people always need to eat.
Valentine had proposed giving the poor tax credits in exchange for raising the food tax. But some advocates for the poor still opposed that, saying it could still hurt retirees, the disabled or the homeless because they would not know how to file for tax credits or may not have an address to prove they are eligible for it.
Niederhauser said that for now, support for raising the food tax "doesn't seem to have the energy to actually move that forward."
Valentine said he may still introduce the proposal as a numbered bill, but only so other lawmakers can study it to possibly build support for it in the future. "We really need to talk about the structural integrity of our tax system," he said.