Cole / Nicole LeFavour

Credit for Food

Monday is the day we start to delve into the issue of grocery taxes, asking whether or not you should pay a the full sales tax on the food you buy. Philosophically, food is an essential item which people have no choice but to buy, so it should be taxed minimally if at all.
    The only bill which the committee will hear on Monday is a grocery credit bill, not one to remove the tax on groceries or food. The grocery credit is that same $20 you get to take off your income taxes. Some of our Republican colleagues propose to increase that to $30 for all tax payers, except to $55 for all those over 65 or earning less than $1000 Idaho taxable income. They propose that the credit on your income taxes would increase in $10 increments over the years and so could eventually climb to $90 or so depending on how much food costs and what rate the sales tax is set at.
    As Democrats we have a bill to actually take the tax off of food at the cash register over six years, one penny at a time. The grocery tax brings in about $180 million dollars which we spend on education, prison programs and staff, health care, state employee salaries and other budget items. If we eliminated the tax on groceries all at once we would have to come up with $180 million in other money to fix this hole in the budget.
    I personally am curious if many people out there would be willing to exchange paying a tax on services for not paying a tax on food. It probably depends largely on your income and spending habits but people living on modest incomes tend to spend more on food, in fact a huge portion of their incomes is spent on food. As more and more of our economy shifts from goods to services, we tax less and less of people’s purchases. Even in feeding themselves, people in higher income brackets may eat out more and spend far more on attorney fees, hair cuts, tax preparation and a whole host of other services, none of which come with a sales tax the way food and clothing and other items do.
    In what seems like a cruel twist on the idea of relieving the cost of the tax on food, the grocery tax credit bill we will hear on Monday doesn’t let people have any grocery tax credit for the months in which they get any food stamp assistance at all. Even someone getting $25 a month in food stamps will get no grocery credit. While there are some good provisions in the bill, like letting people donate their credit to our state heating assistance program, I believe the food stamp provision is a major flaw of the bill.
    If you pull away from the statehouse, up through the many snow covered trees into the sky, you look down and see in our three legged stool of a tax system — sales tax, property tax and income tax. You see that the income tax is the one place we try to take into account how much people earn and adjust the taxes to account for their ability to pay. To give away $30, $50 or $90 to all tax payers within the income tax part of our system is potentially irresponsible. This is the one place we are even able to consider people’s income when we tax them. It is the one place we can try to make up for the fact that lower income people pay a higher portion of their incomes in sales tax paid on taxable essential items like food.
    Philosophically I know I pay my income taxes hoping that my money will go to pay for urgent needs like education and providing health care or housing to those who can’t afford it. I don’t want my tax dollars given back to me or to someone driving a hum vee. Fifty dollars can be hugely meaningful to people in lower income tax brackets, but in the upper incomes, this expenditure of state funds will cost the state over a hundred million in a few years without making much of a difference in those lives. Should we choose not to charge the tax in the first place the debate is different. We can ask ourselves how would we rather pay that tax? What is a more fair way to raise that money other than taxing something which every one has to have in order to survive?