Hungry for taxes? Utah’s hefty food tax hike fills the bill

Petition underway to stop food tax making the poor pay higher taxes than the rich

Salt Lake City, Utah, Jan. 6, 2020—Utahns have an opportunity to stop a massive 177% tax hike groceries. They can do it by signing a petition that will let voters decide whether a typical family of four should pay about $387 more each year for food.

Registered voters can go to www.utah2019tax.com to learn how to sign the referendum that will let citizens decide whether they want to pay more taxes for groceries, fuel and services.

“This is reverse-Robin Hood because it forces the poor to pay more taxes than the rich,” says Fred C. Cox, referendum organizer and former state legislator.

Scrooge-like tax reform During a Christmastime special session, Utah legislators passed S.B. 2001, a tax reform bill that makes poor families pay more than four times of their income towards a food tax than rich families. The U.S. Department of Agriculture found that families in lowest quartile spend 35.1% of their income for food, compared to 8.2% for families in the highest income quartile.

Food taxes take a hike The USDA determined an average family of four spends about $14,460 each year for food. Utah families pay $313 annually under the current 1.75% food tax. The same family would be on the hook for $700 at the new 4.85% rate—or $387 more each year for food. A single male adult spends about $4,244 annually for food. This works out to a total $74 annual taxes at 1.75% and $204 per year at the 4.85% rate—another $132 for food taxes each year.

“The food sales tax is the most regressive tax of all because it takes a larger share from low- and middle-income families than they do from rich families,” adds Krista Palmer, Utah Tax Reform Coalition, executive director.

Shell-game refunds Under the new bill, legislators did allow a family of four to receive a $500 tax credit if they make less than $45,082, but the tax credit is reduced for any income above that amount and completely wiped out if the family makes $73,633. The median family income for Utah is $77,940—which means most won’t qualify for the deduction and likely will not be able to afford an accountant to try and get it.”

A study by The Institute of Taxation and Economic Policy found the poorest Utahns already pay a higher share of taxes than those in the top 5%.

Race for signatures The legislature requires referendum backers to gather 115,869 signatures, divided proportionally among at least 15 of Utah’s 29 counties, by January 21. In less than two weeks, 6,486 voters have signed the petition—50% more than the total on Friday. Many more signatures have been gathered but haven’t been turned in.

Referendum organizers have also raised more than $29,000 to pay for the printing of all of the needed signature packets. Each county has a petition coordinator to oversee signature gathering in their areas. A list with the latest times, dates and locations for petition signing events can be found here.

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