Tax Options Survey

Question 1 – A proposed bill in the Utah Legislature may be numbered this weekend that would lower the overall state sales tax rate of 4.7%, and increase/equalize the state sales tax rate on food of 3%, to a single unified rate of around 4.25%. The total tax collected under the new unified rate would be “tax neutral” (i.e. it would not increase taxes currently paid to the state). The reason proposed for this change is to smooth out the volatility of sales tax revenue to the state under the split sales tax rates due to economic volatility (i.e. more tax revenue is collected on average during years of economic growth and less during years of economic recession). Top of Form Would you support lowering the overall sales tax rate on most things you buy, and at the same time increase and equalize the sales tax rate on food?

Some of your other responses:

“This is a complicated issue. I’m ok with the sales rate change as proposed but the credits for groceries for low income sounds like a mess. Filing taxes is complicated enough without more credits to calculate. Additionally I am apposed to any grocery tax credit that pays money beyond the taxes that are paid.”

“I am in favor of lowering taxes. I’m not in favor of raising taxes on food.”

“It’s not clear what “tax neutral” is and how that solves the problem of market volatility. I liked the idea of having a rainy day fund where taxes were placed during good years and used when it was needed in the dip years. I wonder if something could be done like that instead of increasing taxes and low income incentives.”

“Why not implement a tax in internet sales to provide the needed funds?”

“My vote is a NO but I would like to explain why. I am opposed do this because it increases the tax on food and negatively impacts low income families. An income tax credit does not alleviate this burden because the tax credit only applies at tax time, but they are purchasing food at a higher price all year long. Even with the tax credit, the burden on low income families is not where I would like to start with tax reform.”

 

Question 2 – Would you support a low income tax credit for food purchases?

Some of your other responses:

“Yes I would, but applied at the time of checkout on non junk food items only.”

“I would be interested in learning how this credit would be issued. My concern is that low income families my not itemize their taxes. I can see an adjustment being given to food stamps recipients through the program but how could the credit go to lower income families. But even if these questions go unanswered I would still support the more stable tax structure.”

“My concern is this: What is the long-term impact of locking in another static tax credit?”

“No, probably not but once again I doubt things are this cut and dry. Racing those who excel at a higher rate is not “fair”. It is foolish. One straight rate that applies to all is fair. There is bit enough data here to understand the bill and too often they are too long and complicated to read when it us spelled out.”

“My answer is NO but again I would like to explain. It isn’t that I don’t think a tax credit is warranted, it is that it is too little too late. A tax credit won’t do them any good if they are purchasing food at a higher price all year long. Low income families don’t have the luxury of waiting around to collect their tax credit. They can’t afford the increase day to day, week to week, month to month. Getting a tax credit when it is time to file their taxes is a nice gesture, but it doesn’t alleviate the day to day burden.”

 

Question 3 – Would you support a state Earned Income Tax Credit (EITC) for lower income Utahns (an EITC provides a tax credit to low income working Utahns)?

Some of your other responses:

“Yes, as long as this isn’t a refundable credit where they can get back more money than they paid in taxes.”

“Probably not. I’m glad to see options here beyond yea or nay and I hope they get read. There are many charitable options for those in need. I don’t support anything near socialism that takes away one’s agency to give. Giving a discount just because someone is low income is the wrong incentive. Instead offer credits to those who improve their military situation and provide opportunities for people to volunteer to teach those willing to really improve. Handouts sold be temporary and include resources to improve.”

“Those who are lower income are still somehow able to buy cell phones, sign their kids up for sports, and go out to dinner etc. The decrease of the sales tax on non-food items should be plenty to off set the slight increase in food sales tax. Sales tax is the truly constitutional tax in that it is representative. If you need to save money, buy less.”

“My concern is this: What is the long-term impact of locking in another static tax credit?”

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