Hiding behind food price inflation: government taxes
Price inflation has a lot of ingredients. But one that doesn’t get enough attention, but is a contributing factor behind those higher food bills, is government taxes.
As Reason’s Baylen Linnekin writes, local taxes on food often get decided in ballot measure elections, with mixed results. But there is some hope that wider food tax regimes – imposed at the state level, — may be coming to an end:
…Utah is one of 13 states that taxes residents’ grocery purchases. State Rep. Rosemary Lesser (D–Ogden), who’s pushing to repeal the state’s food tax, said she’s worried about the regressive nature of such taxes.
“For people who are living paycheck to paycheck, the food demands don’t change, and people sometimes have to choose between a roof over their head and finding food from whatever sources they can,” she told Utah Public Radio last month. In a separate op-ed last month, State Rep. Lesser also noted that a food tax “disproportionately hurts low-income Utahns and contributes to food insecurity.”
In Kansas, similar arguments have been raised as part of efforts to repeal or reduce that state’s food tax. And it’s also become a campaign issue in the state’s looming gubernatorial race.
While current Democratic Kansas Gov. Laura Kelly campaigned in 2018 on a promise to cut the state’s food tax, the current leading GOP candidate for the state’s top job, Kansas Attorney General Derek Schmidt, said last week, in remarks reported the Topeka Capital-Journal, that Gov. Kelly has dropped the ball on repealing or reducing the state’s food tax, which the CBPP says is the nation’s second-highest, after Mississippi’s.
And in Virginia, Republican Gov.-elect Glenn Youngkin promised to end the state’s 2.5 percent grocery tax.
Ending such a regressive tax, which punishes the poor even as it enriches the state, should be a no-brainer. But these kinds of taxes manage to endure in large part because the political class likes the easy money these taxes generate…especially when inflation boosts their take without them having to do anything at all.