Legislators discuss increasing taxes on food and on high-earners

Stock composite image, St. George News

ST. GEORGE – A bill proposed in the Utah Senate would raise the income tax for Utahns with taxable income over $250,000 for an individual or $500,000 for a married couple.

The measure would benefit school children by raising another $322 million annually for education.

The Income Tax Amendments bill, sponsored by Sen. Jim Dabakis, D-Salt Lake, would increase the tax rate for high-earning individuals from the current 5 percent to 7 percent.

“It’s exactly the kind of money that Washington County needs to feed the minds of all of those emerging fabulous kids there,” Dabakis said, alluding to children who are being cheated by having the biggest class sizes in the nation.

Dabakis believes the bill is a more equitable way to raise money for education than a proposed increase in sales tax on unprepared food proposed by Utah GOP leaders last week.

According to a report in UtahPolicy.com and in the Deseret News, Utah Republicans are considering reinstating the state sales tax back on unprepared food, then lowering the tax rate to make the actions revenue-neutral in 2018.

Republicans plan to make other changes to the sales tax, income tax and gas tax in the final three weeks of the legislative session, although no bills have yet been proposed, UtahPolicy reports.

Read more: See all St. George News reports on Utah Legislature 2017 issues

“They want to raise money from the poorest of the poor,” Dabakis said.

“There’s not a more regressive tax on planet Earth,” he said. “You take families that are just barely getting by and you raise their family food tax.”

Ultimately there are two choices, Dabakis said. The first choice is increasing taxes for people who have done “very, very, very well” and raising $321 million a year; the second is increasing the tax on food and raising $180 million each year.

“For me, that’s not a hard choice.”

“Our school kids are desperate. We’re 50th in nation in spending per kid,” Dabakis said. “Our kids in Southern Utah simply are not going to be able to keep competitive internationally if we don’t start making a broader commitment to education.”

The proposed income tax increase would only affect high-earning Utahns who have benefited from economic conditions in recent years, and would change the rate back to the 7 percent it was in 2006, Dabakis said.

In 2006, Utah went to a flat tax; prior to that the highest state income tax rate was 7 percent, and couples making over $500,000 paid the 7 percent, Dabakis said.

We gave them (high-income individuals) the biggest tax cut in the history of the state of Utah,” Dabakis said; and the result was that money was taken from neighborhood schools and put into the pockets of the state’s richest families.

“The Republicans are out of touch with common working-class people,” Dabakis said. “They’ve forgotten what it’s like to actually go work for a living.”

Raising the sales tax on food wouldn’t help education anyway, because the funds raised would go into the state’s general fund.

The Income Tax Amendments bill was introduced Jan. 31. Under the proposed bill, the higher rates would also apply to resident and nonresident estates and trusts. If passed, the changes would take effect Jan. 1, 2018.

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Copyright St. George News, SaintGeorgeUtah.com LLC, 2017, all rights reserved.

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13 Comments

  • comments February 20, 2017 at 7:10 pm

    All the cash flowing thru this state and they decide to tax food. I don’t even…

  • ladybugavenger February 20, 2017 at 7:57 pm

    Food shouldn’t be taxed period. Raising the food tax already in place, terrible!

    Food bought with food stamps aren’t taxed and the person barely getting by without food stamps pays tax on food. It’s inhumane to tax food in an already broken and struggling society!!!!

    Kids are hungry and you tax their food?

    Get into the lottery and marijuana business for funds not the taxing food business!

  • utahdiablo February 20, 2017 at 8:35 pm

    Raise the Food tax?? Food is a Basic Human Need you …* greedy …*….not education, not a new house, new car, gym membership, rifles, guns, bullets, etc….but food?? your all so …* backwards….raise the …* tax on the rich, they want southern California here in southern Utah, let them pay for it, …*, raise their tax to 15%, it’s only a …* write off to them anyway, but leave the food tax alone, in fact, get a clue and abolish it like California has always done….
    Ed. ellipses: …*

  • dodgers February 20, 2017 at 9:01 pm

    A few ideas to help generate more revenue for schools:

    Limit child dependent deductions for state income taxes to 2.
    Charge a nominal tuition fee, per child.
    Those with children in public schools must have skin in the game, and the more children in the system, the more skin required.
    The Parents are responsible for their children.

  • .... February 21, 2017 at 1:46 am

    No more mandatory state inspections in the future so got to keep them tax dollars rolling in

    • Real Life February 21, 2017 at 9:44 am

      Coming up with that must have taken a lot out of you. I am impressed. You had better take a nap and rest up for your next comment.

      • .... February 22, 2017 at 2:19 pm

        If you actually had a job to go to you wouldn’t of been here making another one of your stupid comments

  • darkgoddess February 21, 2017 at 5:37 am

    I moved here from a state that taxed food (Arkansas), which I always felt was ridiculous, since there’s so many poor there. I can tell you that Utah’s food prices are already high without adding a food tax. People pay more for meat (beef) here, and also milk/dairy products, among other things. I agree with taxing the wealthy at a higher rate, and also I agree with @ladybugavenger – get into the lottery business or marijuana business if you want to generate a large amount of money. All those Utah plates I see at the Dam Store in Beaver Dam, AZ and the casinos in Mesquite. Money that should be spent right here in Utah. And don’t give me the spiel about poor people spending hard earned money on the lottery – they will do it regardless if it’s here or in another state.

  • Not_So_Much February 21, 2017 at 6:40 am

    Maybe the State could spend less? Lower all taxes?

  • Common Sense February 21, 2017 at 6:48 am

    I don’t think it’s fair to tax “rich” people just because they have done “very, very, well”. Since moving here I have noticed our schools are way nicer and newer and class sizes way smaller than the state we came from. The main problems I notice in classrooms are the students who have bad parents at home that are reflecting their poor qualities on to their children who then cause disruptions and limit learning for others in class.

  • tcrider February 21, 2017 at 7:49 am

    This is utterly ridiculous,

    the amount of money being collected for for food items is one of the least effective
    ways of collecting money from people that have more wealth, how about targeting
    other means that wealthier people pay more money, like for example, property taxes,
    and charge 1 1/2 – 2 times more for a home that cost 300-400K or more, or how about
    luxury taxes on new vehicles that cost more than 30K ? the state of Utah has their head
    in the wrong place when it comes to helping the poor, come on church and civic leaders,
    how about practicing what you preach ?

  • mmsandie February 21, 2017 at 8:41 am

    Dukakis says the publicans are out of touch with middle class… Then why did utah vote for Trump?? I didn,t and those rich people in Washington Don,t care about the middle class. Putting tax on food is ridiculos. So smaller people who eat less if gardeners pay less taxes????whar about adding luxury taxes… What about raising wages for teachers to keep them, pay their medical insurance too???

  • peanutz714 February 21, 2017 at 9:54 pm

    Let’s make more Utah families go hungry!!! This targets the poor! The GOP complains about people on food stamps , but in turn, it increases the cost of food !!! Idiots !!!

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