These red states are still imposing regressive grocery taxes: report

Rep. Buddy Carter of Georgia has been drawing a great deal of criticism for his Fair Tax Act of 2023, which proposes a 30 percent national sales tax that would cover everything from cars and refrigerators to clothing to groceries. Everyone from President Joe Biden and House Minority Leader Hakeem Jeffries to right-wing anti-tax activist Grover Norquist has been slamming Carter’s proposal as regressive; Norquist has argued that it would be especially hard on retirees living on fixed incomes.

The Fair Tax Act stands little or no chance of becoming law in the next two years. Even if it passes in the U.S. House of Representatives, it would face a major hurdle in the Democrat-controlled U.S. Senate. Moreover, Biden would no doubt veto the bill if it somehow made it to his desk.

If Carter’s bill ever did become law in a post-Biden America, it could make groceries especially expensive in some red states — where groceries would be taxed at both the federal level and the state level.

READ MORE:'Rotten' and 'grossly regressive' GOP tax proposals are a major 'gift' for Democrats: conservative

Most parts of the U.S. don’t have a state sale tax on groceries, but journalist Bernie Becker, reporting for Politico in a January 29 column, takes a look at the places that do tax groceries. And many of them are red states, including South Dakota, Kansas and Idaho.

South Dakota, Becker notes, doesn’t have a state income tax but has a 4.5 percent state sales tax that includes groceries. However, Republican Gov. Kristi Noem, according to Becker, “wants to fully exempt groceries from the state’s 4.5 percent sales tax.”

“Only about a quarter of states actually have a grocery tax on the books,” Becker observes. “And in a good number of those states, the grocery tax actually is a pressing topic for lawmakers these days.”

Becker points out that Tennessee “paused its grocery tax for a month last year,” while “Idaho expanded a grocery tax credit last year in a big GOP tax bill, but stopped short of cutting the state’s grocery tax.”

READ MORE: Labor expert denounces GOP tax plan 'one of the most regressive proposals in a generation'

Kansas is another red state that has had a grocery tax, but its centrist Democratic governor, Laura Kelly, wants to end it altogether.

“Kansas is currently phasing out its tax on groceries, which was a priority last year for Gov. Laura Kelly,” Becker notes. “But now that the Democratic governor has won reelection, she wants to get rid of the grocery tax immediately, and is battling GOP lawmakers more interested in cutting the state’s income tax.”

Inflation, according to Becker, is a major factor in calls to reduce or eliminate state sales taxes on groceries.

“You can see why the good politics would have nudged dozens of states to get rid of grocery taxes even before this latest round of inflation,” Becker notes. “You can also see why the states that still taxed groceries started looking for relief last year, particularly given how flush many of them were with surpluses.”

READ MORE: Republicans are trying to distance themselves from the national sales tax plan. Too late

Read Bernie Becker’s full Politico column at this link.