Entries Tagged 'food tax' ↓

Position Statement on Sales Tax Initiative

Bread for the World-South Dakota • September 13, 2011

Bread for the World-South Dakota neither supports nor opposes the South Dakota ballot initiative to raise the sales tax.  We realize that it raises funds and specifies them for important causes.  However, it also raises the sales tax rate on a number of life’s basic necessities.

We believe that both supporters and opponents can agree that sales tax on groceries should not be raised–regardless of whether the initiative passes and the tax goes up on other things. Even without adding additional tax on food, the initiative would still raise over $160 million for schools and Medicaid – a significant sum.

The ballot initiative, as written, allows a way to keep the increase from being applied to food, because it applies the additional 1% sales tax only to items that are taxed at the 4% state rate. Thus, if the 2012 legislature would take any amount off food, even 1/2%, the food tax would not go up if the petition passes.

In this case, the food tax (state and local sales taxes combined), which currently costs families annually enough to buy 3 weeks worth of food, would not go up to 3-and-a-half weeks. It would keep the tax on a basic can of powdered baby formula below $1.

Even a one-half-percent reduction would be an acknowledgement of the current economic struggle.

This position neither supports nor opposes the initiative.  However, it is our hope that both supporters and opponents of the initiative will agree that keeping the tax on food as low as possible would be helpful for children, families, seniors and nursing homes, for good health, and for the economy.

MY THOTS: Taxing food more to fund healthcare and education seems a bit assbackwards considering good nutrition helps students learn better and contributes to a longer life. But solving problems by going to root seems to easy. Nevermind.

 

Real Classy South Dakota

Okay, so the state department of revenue just chooses to ignore a state law for decades (instead of just telling the legislature to fix it) Then all of sudden decides they must enforce it? Then says if you want to skirt the law, you can go thru a complicated application process for something you may do a couple of times a year? Then, the kicker, since they can’t tax people who receive free food (from food banks and churches) they have to tax the food these orgs are giving away? WOW! Talk about having to pay extra for a undercooked shit sandwich;

About 275 organizations statewide that give away food to needy people might be forced to pay a long-unenforced sales tax, prompting some to worry the agencies simply will stop providing food to the poor.

At issue is a handling fee that agencies pay to the organization that supplies them with food.

A state law outlining the taxes has been on the books for decades. But it wasn’t until late last year that an audit discovered the maintenance fees existed and needed to be taxed, said Jan Talley, director of the state’s Business Tax Division.

“We are charged with enforcing the statutes of South Dakota,” she said.

Your charged with enforcing a law that you haven’t enforced for decades? So instead of just getting the powers of be to fix it, you have to be the assmunch instead and enforce it? Seriously?! Pierre is freaking broken, and this is further proof.

But the best part is the Argue Endorser’s online poll today;

 

I would like to meet these clowns that think it is okay to tax orgs that give food to the needy. I have a sandwich I would like to feed them. And it’s not made of turds.

 

Food tax to rise again? (Guest Post)

This is a guest post by Cathy Brechtelsbauer from the local chapter of Bread for the World

July 30, 2011. There’s another article in the Argus today on a proposed ballot initiative to raise the sales tax and we still can’t tell if it includes the sales tax on food. The initiative’s wording is not yet announced, but it is a cause for worry that two or three articles on the topic have not mentioned exempting food from the increase.

Planners of the initiative represent education and healthcare organizations. They hope to raise $175 million for education and Medicaid. Funds are needed because of cuts from the last legislative session and governor.

A 1% sales tax increase may seem like simplest idea for an initiative, but South Dakota’s sales tax applies to food! In 2010 each per cent on food (home food, not prepared food) raised an estimated $14 million.

Background info: The “streamlining” sales tax rules allow for tax rates on food and utilities to be different from the general sales tax rate, even zero percent. Lately some states have taken advantage of this and have been stepping down their food tax, like Arkansas. None of our neighbor states tax food. North Dakota has been phasing out the tax on home heating bills.

At least food be exempted in this initiative. By exempting food the tax increase would inflict somewhat less hurt on those the initiative is trying to help. There’s something strange about raising sales tax to help nursing homes: South Dakota nursing homes (unlike hospitals) pay sales tax on all of their food and supplies. A sales tax increase would cost them dearly and also unduly hit their workers, who are not exactly rolling in dough. An exemption for food would reduce the initiative’s negative impact. Similarly for the South Dakota teachers with incomes low enough that they too struggle to cover the basics for their families.

The biggest concern might be the impact on nutrition: child nutrition, senior nutrition, diet-related diseases. The food tax in South Dakota is already equivalent to three weeks worth of food in a year. Teachers too often see the effects of child hunger on learning. Child hunger is probably worse in summers without school meals. Relatively few kids make it to the summer lunch sites. Healthcare workers see how hard it is for people to eat healthy.

Healthy food is not necessarily the cheapest. (The states with the highest obesity rates are among the nation’s few food taxing states.)

You can add to those issues the impact of the food tax on already strained local food charities; regressive taxation; wealth disparity; potential shrinking of the safety net looming from federal budget cutters and cappers. And with an almost useless state food tax refund program, you can see why some of us will be unwilling to support a ballot initiative that raises the food tax, even though we care deeply about education and healthcare.

Better ideas for a sales tax initiative: Even if the initiative would forego the food’s portion of the tax ($14 million in 2010), it could still raise a big sum. Better yet would be a reduction in the food tax, however slight. Either of these approaches would signal a recognition of the struggles of nursing homes and ordinary families trying to put food on the table so their kids’ tummies aren’t growling when the teacher is trying to teach.

Cathy Brechtelsbauer, Bread for the World, Sioux Falls

The most important office of government is citizen. -Justice Louis Brandeis

 

HB1131 voted down this morning (Food Tax shift)

This comes as no surprise to me (From my email box);

Advocates,

Unfortunately HB1131, to shift tax off food, was voted down in House Taxation Committee this morning.

You can thank the supporters: Rep’s Feickert, Feinstein (bill sponsor), Kirschman, and Bernie Hunhoff

Voting against the bill: Conzet, Greenfield, Kirkeby, Liss, Moser, Perry, Rozum, Russell, Solum, Wick, Willadson.  (Last year Kirkeby voted for a similar bill.)

Listen to the whole committee hearing by going to:

http://legis.state.sd.us/sessions/2011/CommitteeMinutes.aspx?Committee=24&File=minHTA01270745.htm#2040

Click on the SDPB symbol at the top over the date 1/27, and scroll half way through the session because this bill came up about half way through.

There was an excellent body of testimony by Rep Feinstein, Greg Boris of Voices for Children, Matt Gassen (director of Feeding South Dakota, our food bank network), Pastor Karl Kroger, Joy Smolnisky of South Dakota Budget and Policy Project, and Kristin Ashenbrenner of SD Advocacy Network for Women. Also weighing in were Luke Temple of Dakota Rural Action and Senator Billie Sutton of District 26.

The opponents were Jim Terwilliger from SD Bureau of Finance & Mgt, David Owen of the Chamber of Commerce, and Ron Olinger of SD Retailers.

Comments of the legislators before the vote were very interesting:

Conzet and Wick said the refund program needs to do more educating. (It should be noted that people have tried over 7 years, which should be enough evidence that such programs do not work.)

Moser said the people who come to his church for help in Yankton are asking for help with rent, medical, and utilities, not food, and there are enough programs helping with food.

Liss said this bill “sets up a financial incentive to obesity”

B. Hunhoff, a supporter, said this will happen someday. Why not today? It’s a good moral step to help working families and the elderly.

The bill was “deferred to the 41st day”. That is how they kill a bill, because there are only 40 days in the session. We always say nothing is over ’til the final gavel sounds, but this vote seems fairly decisive, esp. given the party-line nature of the vote, unlike last year.

Nevertheless, legislators need to understand that South Dakotans really do not like this tax. The publicity against the 2004 ballot initiative had claimed it would cause an income tax and schools closing and snow not being plowed. It said the refund program would solve the problem. Seven years later, legislators should not be able to hide behind a failed, inherently ineffective refund program.

Many thanks to everyone who made contacts on this so far. This bill’s loss does not stop the cause, which goes on, toward making South Dakota a fairer state where all people can thrive.

The Advocacy Project

While I support eliminating the food tax, I think lobbying our State Legislature is a waste of time. Get a big time donor and put it on the ballot. It will pass this time.

BTW, Brian, why did you vote against this?

Another ‘Crash & Burn’ food tax elimination proposal? Maybe we should have a barbie?

Don’t get me wrong, I have always felt that a tax on (essential) food is immoral, idiotic and pretty much insensitive and unfair to the poor, and everybody for that matter. It’s kinda like health insurance. No one should be benefitting from essential goods and services to sustain life. But I also have the feeling that it will fail, again;

SIOUX FALLS, SD – You could be paying less at the grocery store if one South Dakota lawmaker has his way. For the second time in as many years Sioux Falls Representative Marc Feinstein plans to propose cutting the state tax on groceries. Feinstein says constituents have told him how difficult it can be to make ends meet.

And Marc’s idea has merit;

The major difference in this bill replaces the lost four percent grocery tax revenue by adding .35 percent to all other taxable goods.

But Marc, don’t you know that means the rich would have to pay more in taxes for all of their luxury items? Why not just continue to tax the shit out of the working poor who we fuck over on a daily basis in an almost non-existant worker rights state?

While I will give props to Marc for trying a different approach, business owner ran Pierre will have no part of it – off with their heads!

Gargoyle Leader Poll results from Friday; Get rid of the Food Tax.

Well duh.

What I can’t figure out is the 30% that think it is okay to tax food? Weird.

HB 1255 Passes Committee (ending the food tax)

UPDATE: More Games

After such a nice victory in Taxation Committee this morning, a move led by Rep.Faehn in the House this afternoon has now sent HB1255 to Appropriations Committee on Monday morning for its next vote, rather than the full House. So here we go. Your contacts were  wonderful to the last committee. Let’s convince this one too! The people need this tax shift.

If you need any further inspiration, read this from Matt Gassen, Director of Community Food Banks of SD (which distributes food to over 500 agencies in SD)
“No other tax so directly takes food off the family table as the current 4% state tax on food items. To shift the tax off food as proposed in HB 1255 could be one of the single most significant pieces of legislation to impact the hungry of South Dakota in a long time. With the continuing increase in the numbers of individuals (78,000 statewide) seeking emergency food assistance a recent study shows that 32% choose between buying groceries and paying for utilities or heating fuel, 29% choose between food and rent/mortgages and 32% choose between food and gas for their cars. The passage of this bill would make the family budget go farther and increase the amount of food that their grocery dollars would buy. It could also help to ease the strain on emergency feeding programs who are struggling to find enough food to help all those in need.”

Next to house floor – needs 2/3 vote

HB1255 is a revenue-neutral tax shift. The state comes out even with the shift from the 4% state portion of food tax to  3/10% on non-food sales. It is revenue-neutral for the state, but middle- and lower-income people will be better able to afford their basic needs. Better than refund programs. The benefit comes right at the grocery store, to reduce hunger, and improve health and family financial stability.

What about the argument that taxing food provides the state a “stable source of revenue”? This is a line of reasoning from a time when the economy was better, and the worry was  that when times get tough, at least there would be revenue coming from grocery purchases. Well, times are tough. This is the down time. Making a revenue-neutral tax shift when the economy is down would take the worry out of taking tax off food. This is the time to make the shift. The issue will continue until the tax comes off food, so legislators would be wise to do it now. (Does this make sense? There should be a more concise way to explain it.)

A Shocking 48% increase in Food Stamp usage in Minnehaha County in one year

Souf_R_C_-49027

For those who think Sioux Falls is sheltered from the recession, check out these numbers (Bread for the World)

SD food stamp enrollment saw an incredible one-year increase from Sept.’08 to Sept.’09: 34% !!

Food stamps traditionally go up and down with the economy. But no one envisioned such a huge one-year increase.

(The Food Stamp program is now called SNAP.)
Find the data for your county here:

http://dss.sd.gov/foodstamps/data/foodstampdatapast/index.asp

Minnehaha County residents will be completely shocked by their 48% increase.

Let your local Social Services workers know you appreciate them. They are working hard.

One more note: Even if you include up to 4,000 households using commodities rather than food stamps (option available on reservations), there are still thousands of eligible low-income households NOT signed up for food stamps, easily 15,000 to 20,000 or more. The state should campaign for them to sign up. (It’s all federal funds.)


• Food tax refunds’ dismal reach:
less than 1% of SD’s low-income population.

Only 630 households in the whole state are receiving the quarterly food tax refunds. Make sure your local media report this.

Why is it important?

• People pay a lot of money for the tax. Every year the money families pay in food tax would cover meals for 3 weeks.

• There is a movement afoot to raise sales tax for new city projects, even tho’ cities have other ways to raise funds. In an attempt to make this palatable, the draft of the state legislation says cities may refund the new tax to their low-income residents. So far, there is no effective way to do refunds. Such refund programs are inherently ineffective. People need to know, so they don’t think this option would solve the problem of a higher sales tax, and the resulting higher the cost of living.

Bread for the World Action on Event Center funding

Next Monday, Nov.16, the Sioux Falls city council will receive the report from the Event Center Task Force. Whether or not you want a new event center, we hope you will agree that the plan should not ask for the funding to come from struggling families, elderly, disabled people, nursing homes, etc, which it will, if sales tax is the choice for the funding.

1. Can you come to city council next Monday? 7pm, 10th & Dakota

2. Will you contact the council before that meeting?

The city council could ask the task force to reconsider their funding option and bring back to the council a plan that does not tax basic necessities.

BACKGROUND
• There is a movement afoot to ask the state legislature to allow cities to raise their sales taxes for new city projects (such as this event center in Sioux Falls).
• Bread for the World takes no position on whether to build new city projects, only on the method of their funding.
• We oppose an increase in sales tax that would have the net effect of raising the cost of living for low- and middle-income people.
• Sales tax in South Dakota applies to many basic necessities, including food, heat and electric bills, baby formula, baby diapers, car repairs, nursing home food and supplies, and thus, higher sales tax would raise the cost of living.
• Cities have other funding options. The tax on hotels and restaurants comes immediately to mind (called bed-board-and-booze tax). These other options would take longer, but most big buildings are not paid for in 3 to 4 years.
• South Dakota is a low-wage state (at the bottom with Mississippi). Many South Dakota households with low-incomes and middle-incomes do not have extra money to spare for higher taxes, meaning the higher tax would cut into their basic necessities.
• South Dakota’s tax structure is terribly regressive already (the state and local tax burden falling harder on the lower incomes than those more well off), and higher sales tax would make this tax structure even more regressive. [For a graph on this, go to www.endthefoodtax.org. In the section “PDF resources”, the graph is item #9.]
•  Special projects should not be funded on the backs of hungry children, struggling families, the elderly, the disabled, and nursing homes.

Below is the contact info.  Let’s take the privilege to speak up for people who need our voices.

“If you think you’re too small to be effective, then you’ve never been to bed with a mosquito.” -Anita Roddick

– – – – – – – –
SIOUX FALLS CITY COUNCIL 11’09
You can leave one message for all the council at 367-8080
You can send one letter and ask that it be copied for all the council. Address: 235 W 10 St, Sioux Falls 57104
OR WRITE EACH SEPARATELY:
Kenny Anderson, PO Box 7402, 57117, 367-8809, 261-5132-h
De Knudson, 2100 E Slaten Ct, 57103, 367-8111, 338-9431-h
Vernon Brown, 1220 S Phillips Ave, 57105, 367-8809, 339-0084-h
Pat Costello, 108 W St Andrews Dr, 57108, 367-8114, 334-6942-h
Gerald Beninga, 4205 S Lewis, 57103, 367-8109, 339-1921-h
Greg Jamison, 6300 Grand Prairie Dr, 57108, 367-8819, 361-9500-h
Bob Litz, 615 S Grange, 57104, 367-8115, 331-4409-h
Kermit Staggers, 616 Wiswall Pl, 57105, 367-8112, 332-0357-h
Mayor Munson, 224 W 9th St, 57104, 367-7200, 336-6987-h

FIND THEIR EMAIL ADDRESSES IN THIS LIST:
kandersonjr@siouxfalls.orgdknudson@siouxfalls.orgvbrown@siouxfalls.orgpcostello@siouxfalls.orggbeninga@siouxfalls.org,gjamison@siouxfalls.orgblitz@siouxfalls.orgkstaggers@siouxfalls.org,
Mayor Munson <citylink@siouxfalls.org>
———

FOOD TAX REFUND PROGRAM REACHES LESS THAN 1% OF LOW-INCOME FAMILIES

no-food

FROM BREAD FOR THE WORLD;

South Dakota’s food tax refund program reaches fewer than one percent of the state’s low-income households. During the most recent quarter, refunds went to only 630 households statewide. But South Dakota has at least 94,000 low-income households, 32% of the state’s households (the number at the time of the 2000 census).

Rebate-type programs are inherently ineffective in reaching low-income people. This has been known for years from the extremely low numbers reached by South Dakota’s tax refund program for low-income senior citizens and citizens with disabilities. No matter how simple the paperwork, low-income people are missed for many reasons. Low-income, and now some middle-income families, have many stresses and time-consuming issues. They lack financial advisors to keep them signed up for available benefits. Some do not want to go to the store with a debit card from the state. Also, many are elderly, ill, mentally incapable, emotionally distraught, or simply dealing with the crises that come more often to lower-income homes.

“We feel the state made a mistake five years ago in assuming the problems of taxing food could be solved with a rebate-type program,” says Cathy Brechtelsbauer, state coordinator for Bread for the World. “It should be clear by now that cutting the tax on food is the only practical and effective way to reach all the struggling families, elderly and disabled South Dakotans who are negatively impacted by the food tax.”

Even one percent off the food tax would give more benefit to low-income people, as a group, than the rebate program.

Optional addition to the article:

This year legislators sharply narrowed eligibility for the food tax rebates. They excluded households with any amount of food stamps, even partial allotments, leaving only about 12,000 of over 94,000 low-income households eligible.

“Denying refunds for people with food stamps, especially those with only partial allotments of food stamps, ignores the reality that food stamps commonly run out before the end of the month. Then food must be purchased with hard-to-come-by cash normally needed for other necessities like transportation or laundry,” says Brechtelsbauer.

Store clerk Debbie Koppman misses the rebate that formerly came on her debit card every quarter, “It came in real handy. In that month, it was real nice to get it just when food stamps were running low. You could buy milk or cereal or some hamburger that you needed.”