NEWS ROOM

How much does the grocery sales tax impact low-income families in Utah?

May 13, 2022

The sales tax on groceries in Utah has been an active issue for the last few years.

With rising inflation, it seems the cost of groceries is higher than ever before, making a discussion about eliminating the sales tax on groceries much more relevant.

A proposal by State Rep. Rosemary Lesser, D-Ogden, in the Utah legislature this year failed to garner enough support to eliminate the tax on unprepared food in the state. Lesser was also a key player in a grassroots effort to gather signatures to repeal SB2001 in 2019 which would have allowed lawmakers to increase the food tax. Individuals gathered over 150,000 signatures, exceeding the requirement for a public vote, but the bill was repealed by lawmakers in 2020 before it went into effect.

Proponents of keeping the tax have cited several reasons why eliminating the food tax won’t make much of a difference for low-income families. One cited study out of the Tax Foundation, based in Washington D.C., states that eliminating the tax on unprepared foods only saves an average of $2.50 per person each year.

The study seems flawed however, since it considered the bottom third of low-income households nationally without differentiating between states that charge the grocery tax and those that don’t. It also does not differentiate between households who receive SNAP or food stamp benefits and those who don’t. Additionally, the Tax Foundation study assumes that the average low-income household leans heavily toward pre-made or frozen foods, which are often taxed normally and not considered the same as unprepared foods.

Food consumes 36% of the budget for low-income families according to the US Department of Agriculture. For many large families, headlines stating the elimination of the food tax likely wouldn’t help low-income families, are confusing if not misleading.

For plural families, many of the assumptions used in the studies are not true. Many live in Utah which still has a tax on unprepared foods. Many plural families who are eligible for food assistance programs do not apply for fear of reprisals for their family situation. Many of the plural family community also lean heavily toward natural, raw, and unprepared foods for health and religious reasons which means most of their food budget falls into this category.

It may be time to take a closer look at whether the food tax effects low-income families in Utah based on Utah numbers rather than overly broad national averages.

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