food tax

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

l3wis November 6, 2009 6Comments

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.”

A Modest Proposal

l3wis February 8, 2009 0Comments

Wanna save money on the food tax? Buy horse food.

The Sisters wrote an incredible and common sense letter about ending the food tax:

It’s an inhumane tax. Food for horses, pigs and pheasants is not taxed, but tax is collected on food for babies and nursing homes.

The heck with selling kids for food, we should be selling horses for food.

SB199 would End the Food Tax

l3wis February 4, 2009 0Comments

Food prices are up. The economy is down. Increasingly, South Dakota families feel the pinch when grocery dollars go for TAX instead of food.

SB199

• Ends the WHOLE cruel food tax

• Has bi-partisan leadership (Senator Merchant & Representative Cutler)

• Shifts taxes to fully maintain state, city and tribal revenues formerly raised by taxing food. (The revenue is replaced simply by tax shifting, 1/2% more tax to all non-food sales.  Check below to see how this fairer method works.)

• Wisely provides a revenue cushion in case non-food sales slump with the economy. (The cushion is provided by leaving the tax on pop and candy.)

•  Saves state dollars by ending a current state program — The food tax refund program will no longer be needed. It never did reach enough people.