Cutting food sales tax shouldn’t lead to cuts in services for low-income families, advocate says

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TOPEKA — Working for a food bank, Karen Siebert has seen how many Kansans face difficult choices between putting food on the table and paying for utilities, rent or medical care.

Siebert is the advocacy and public policy adviser for Harvesters, a food bank that serves 16 counties in northeast Kansas. She works to address gaps or barriers in Kansas policy leading to a food insecurity rate above the national average.

Bipartisan legislative proposals to cut or reduce the state sales tax on groceries will help Kansans who are forced to choose between food and other basic needs, Siebert said in a recording for the Kansas Reflector podcast.

“When you are spending 10% of your food budget on taxes that means you’ve got to stretch the other 90% that you have available for food even farther,” she said. “I think what that does, unfortunately, is it makes people make really difficult choices of do I get this fresh fruit or do I get the ramen that’s calorie dense and is going to last my family longer.”

Last week, Gov. Laura Kelly announced she would file legislation to exempt food from the state sales tax, joining Attorney General Derek Schmidt in urging GOP leaders to act on the issue. Kelly estimated Kansas families would save $500 or more a year on their grocery bills.

Kansas is one of seven states with a full tax on groceries, and the state rate of 6.5% is the second-highest in the country. At least 37 states levy no sales tax on groceries and six more have reduced grocery taxes.

Grocery prices have been rising across the country with the latest consumer price index showing a 5.4% increase in prices from September 2020 to September 2021.

By exempting groceries from sales tax collections, the state would lose an estimated $450 million in annual revenue. With Kansas fiscal experts projecting a $2.89 billion surplus to the state general fund, Siebert said this is the time to cut the grocery sales tax.

Siebert said advocates have long wanted the state to cut the sales tax on groceries, but worried that doing so would lead to cuts to essential services for low-income families — the very people the food tax cut is designed to help.

“I think where the rubber hits the road for the legislative session is to figure out how that is covered for the long-term and to make sure that low-income people aren’t the ones that are going to bear the brunt of the reduction of that revenue,” she said.

While 10.9% of Americans are food insecure, 12.1% of Kansans are food insecure. The rate among Kansas children is 17.1%, much higher than the national average of 14.6%.

Higher sales tax also affects the business of many grocery stores near state borders, Siebert said. Many people who live in Kansas will cross over to Missouri, Colorado or Nebraska to buy their groceries, she said.

“Then those grocery stores go out of business and if a grocery, if a rural community loses their grocery store, they lose a lot to the health of that community,” Siebert said. “If we would reduce that sales tax, it would help the efforts of the rural grocery initiative and those rural grocers to get a more solid financial footing and help keep those communities alive.”

Kansas Reflector is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Kansas Reflector maintains editorial independence. Contact Editor Sherman Smith for questions: Follow Kansas Reflector on Facebook and Twitter.

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