Voices for Georgia's Children on the Tax Reform Councils 4% sales tax on groceries

Voices for Georiga's Children:

The Tax Reform Council (TRC) has done a pretty good job overall. Lots of thought and research has resulted in a chance for a broader revenue structure for Georgia, often supporting ideas which have long been sought by business people, advocates and economists alike. Taxing services and the casual sales of cars, aircraft, and boats, and sun-setting many tax exemptions (realizing that most would be reviewed and reinstated and others, not) are a few such ideas.

One proposal, however, which would add a 4% state sales tax on groceries, troubles a number of advocacy groups, including Voices. First let me say that we are aware that this tax could bring in a significant amount of revenue to our hurting state – to the tune of about $500 Million per year. Unfortunately, that tax also would weigh heavily on those who bring home smaller paychecks, pulling a considerable percentage of money out of their earnings to pay for necessities – namely food – for their children and family members.

But we need the revenues, right? Right. So rather than use a regressive tax such as the grocery tax, we support the idea of lowering the state income tax from 6% to 4.5%, rather than the 4% proposed by the TRC. Such a move would fill the revenue gap nicely, and address the inequity dilemma. There are many families in Georgia for whom even $150 per year lost to a grocery tax could mean the difference between paying a power bill, buying healthier foods, or covering a co-pay at the doctor’s office. Kids need good shelter, good nutrition and good health. Increasing the financial challenge on essential (food) items is not the way to encourage that scenario.