clock menu more-arrow no yes

Filed under:

UTAH LEAGUE OF CITIES AND TOWNS MAY OPPOSE FOOD-TAX INITIATIVE

Local government officials from throughout the state have voted to oppose the initiative that would remove the sales tax from food.

The vote came Monday after a heated exchange with initiative supporter Merrill Cook.Directors of the Utah League of Cities and Towns will decide Friday whether to endorse the position taken Monday by the organization's Revenue and Taxation Legislative Issues Committee.

Sentiments were strong during the committee meeting, with Cook finally walking out before the vote was taken. Only two of the 17 committee members present voted "no," saying they favored removing sales tax from food in principle.

Cook had told the group that the state is well on its way to more than a $100 million surplus by the end of the calendar year and said he favored local governments getting a bigger share of the sales tax.

Of the 6.25-cent sales tax per dollar, each city or town gets about 1 cent while the state keeps about 5 cents. Along the Wasatch Front, another quarter-cent is collected to fund the Utah Transit Authority.

But the local leaders were more interested in the immediate effects taking the sales tax off food as of July 1, 1991, would have on their budgets and disagreed with Cook when he told them, "You're scaring yourselves."

After Cook and several committee members argued over just how much the initiative would cut into local government budgets, the committee chairman cut him off.

Before Cook and another Independent Party official left, Cook said the local government leaders were "dedicated to raising taxes. I'm dedicated to lowering them."

Much of the concern expressed over the effects of the initiative came from leaders of the state's smaller communities. Sunset Mayor Norm Sant said they would be most hurt by the initiative because they are most dependent on it.

"Sales tax is the basic thing that keeps us alive," Sant told Cook, adding that he did not know how Sunset, with a population of 5,700, would be able to provide police, fire and other need services without the sales tax from food sales.

"I guess I'm not smart enough as a small-town mayor," he said. "I don't know how to handle this without sales tax." Some 60 percent of the Davis County community's $1.8 million budget comes from sales tax.

Most of that sales tax comes from two supermarkets. If supermarkets stop collecting tax on food sales, Sant said he would not recommend tax increases. Instead, the seven-member police force would likely be cut.

Other communities have similar fears. In Monticello, most of the tourist spending is done in grocery stores. In Richfield, residents travel to the Wasatch Front for much of their non-food shopping.

Although Gov. Norm Bangerter said weeks ago he will vote against the initiative and warned he will recommend budget cuts if it is approved, only the Utah Public Employees Association had joined him in his opposition.

Besides the Independent Party, which was formed by Cook after he and three other tax-cutting initiatives were defeated at the polls in 1988, Democratic leaders have supported the sales tax initiative.