Removing sales tax on food and medicine is on the ballot here. Has your state abolished the tax? How did they replace the revenue?
I have lived in Indiana, California, and Texas. None of those states charge sales tax on food and I am pretty sure that none do on medicine.
I don’t think there’s tax on food in Michigan, but Colorado taxed food. IIRC, Minnesota doesn’t tax clothing. I have no clue on tax on medication.
We don’t have a state sales tax here, but there is a city & borough (county) sales tax totalling 5%. We also had this measure on the ballot in the local election last month, but the government succeeded in scaring the voters about the dire effects if this revenue stream was cut off, with talk of closing schools, laying off teachers and the usual doomsaying. The voters bought it, and the measure to remove sales tax on food was defeated. Chickens!
New York has never had a sales tax on groceries (most of them, at least – the rules are odd) or prescription medicine.
For a state-by-state rundown go to http://www.taxadmin.org/fta/rate/sales.html
The reason for the OP is to find out how our legislative bozos will make up the revenue. Will they put a luxury tax on Caddies or will they kill the food stamp program?
Here in Pennsylvania they don’t tax food, clothes or staples like toilet paper. It helps make the sales tax a little less regressive.
Vote for it. It’s a good thing.
The food stamp program is a federal program, so it won’t be cut if your state votes for the food exemption. Kentucky eliminated tax on food in the early 70’s and replaced the revenue with a severence tax on coal. Of course, the sensible approach would be to bow to the will of the people and cut programs rather than find other ways to raise revenue. A vote to reduce taxes is useless if you just find a way to tax something else.:smack:
Since the object is to help the poor, I would expect a luxury or wealth tax would replace it. However, we are dealing with legislators.
Thanks for the food stamp info. Best example I could think off at the moment.
Is the severence tax on coal for industry or do the poor who no longer have to pay food tax now have to pay more to keep warm with coal or electricity?
Why do they have to replace it, why not spend F%$#en less like we would if we had a loss of income
…sorry for the rant
There’s no such thing as a tax that affects industry only. Any business tax is ultimately passed on to the consumer, rich and poor. However, if I had a choice and could not afford the tax increase, I’d rather bundle up in more clothing and use less energy for heat than try to reduce my food intake.
I agree, but it’s the nature of the beast, if you will.
Senator Smith won’t cut Senator Jone’s program, no matter how wastefull it is, lest Senator Jone’s cut his.
Neither of them can be elected again if they allow the program for unwed blond Rostracranusians that brings money to their district to be cut.
The best one can hope for is other sources of money, ones that don’t effect you and I, but rather come from Mr. Gates and Mr. Walton.
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Originally posted by carnivorousplant *
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Senator Smith won’t cut Senator Jone’s program, no matter how wasteful it is, lest Senator Jone’s cut his.*
You don’t have to cut state spending to accommodate a tax cut. You just have to grow it at a slower rate.
Over the long term, if tax laws remain unchanged, state revenue tends to grow by 6% to 7% per year, due to increasing population and economic growth. Repealing the tax on food and medicine merely slows down this growth for one year.
There is a great deal of variation from state to state in personal tax burden (measured either per capita or as a percentage of personal income). So it’s not true to say that if a state has lower taxes in one area they must be making it up somewhere else.
Tax on groceries here in Oklahoma…
I took a trip to Milwaukee with some buddies a couple years ago, and stopped in Iowa for a sandwich at a QT. I was happily surprised to learn that the customary rummaging for pennies was unnecessary in this fork of the midwest; my sandwich cost a dollar even.
However, anything with advertising on it is not taxed, such as magazines, newspapers, etc. Some stores still tax you though, for some odd reason.
Now wait a minute. If you cut the funding the population still grows at 6-7%. So some peple go without that program.
“Variation in tax burden”-you mean some states don’t spend it all and save it for a rainy day?
Whilst the first statement is true, economists would mostly suggest that it is not a good thing even if they would like to see a more progressive tax system. This is because you get more of an equity bang for your buck by targeted assistance measures/ refundable sales tax credits/ income tax cuts than you do by removing food etc from the base. This is because sales taxes by their nature are impersonal and by excluding food from the base you necessarily exclude the food of the rich as well as the food of the poor. Even though the poor spend a greater proportion of their income on food than do the rich, the rich spend more on food. At the very least, Latecomer’s suggestion that it’s a “good thing” to knock low income elasticity things out of the base of an RST is highly contentious.
If it’s the only tax relief they will receive…
Again, the Gunsmoke joke where Festus mentions that Dillon is putting himself in deadly danger to rescue Miss Kitty, “An ol’ whore lady”:
“Yes, Festus, but she’s the only one in town.”
Aren’t schools usually state/federally funded. If there was no local funding to the school, a local tax cut would have little if any effect.
In Missouri a major part of school funding is provided by real estate taxes levied by local school districts. The tax rate varies from district to district. The rate, and any increases, are voted on by the distric residents.
Wisconsin taxes some food.
http://www.dor.state.wi.us/ise/sales/00-1.pdf
Some Wisconsin counties have a 0.5% sales tax, I’m 99% sure this is for the same things that state sales tax applies to.
Brian