Governor Risch Outlines Plan for Removing Sales Tax on Food
GOVERNOR RISCH OUTLINES PLAN FOR REMOVING SALES TAX ON FOOD
Governor Jim Risch outlined his plan to remove the sales tax from food during the North Idaho Chamber of Commerce 2006 Legislative Tour on Monday evening. Speaking to legislators from around the state, Risch said removing the sales tax on groceries is the right thing to do. It is estimated that $100 is spent per Idahoan each year in sales tax on groceries. For a family of four that adds up to $400 spent in sales tax.
"This is something I worked on when we lowered property taxes and increased the sales tax by a penny. I truly wanted to get it done then, but this issue had not received the same level of scrutiny as property tax relief. It needs to have public hearings and a full discussion by legislators, and then action must be taken on this issue," said Risch. "I will be very disappointed if something is not done in the next session."
Risch's proposal calls for a phase out of the sales tax on groceries over a 6-year period - reducing the sales tax one penny per year and reducing the grocery credit on the income tax each year as well. If the Governor's legislation were approved by the legislature in the next session there would be no further action needed in future years.
"My preference is for a full and immediate repeal. Unfortunately, the loss of revenue to the General Fund makes that immediate and full repeal impossible. I reviewed several ways to make this happen and this is the only way to get it done in a fiscally responsible manner that concludes with a full repeal of the tax," said the Governor.
A full repeal of the sales tax on food coupled with a revised grocery tax credit on the income tax would cost the state an estimated $181 million annually. The net cost of the Governor's proposal would be $30 million each year for the next 6 years.
"I offer this proposal knowing that you as legislators will give this and other plans your full scrutiny. With your review as well as a recommendation from the new Governor I am confident that, whether it is this plan or another one, the people of Idaho will be given relief from the taxes they pay on groceries," Risch said.
http://gov.idaho.gov/mediacenter/press/pr2006/prnov06/pr_141.html