Broaden the base?

Yesterday's Salt Lake Tribune featured an editorial titled "Broaden the base: State should extend sales tax to services." If you didn't get the opportunity to read that editorial CLICK HERE.

The whole premise of taxing services stems from the view of the legislature that the recent cuts (especially the sales tax on food reductions according to the Senate) have made the state's revenue streams less stable. Their argument continues that a full removal of the sales tax on food would only further destabilize the tax revenue the state collects and would open the state up to a lack of money during lean years.

Thus, there is great opposition by the Senate to removing any more of the food tax. The SL Tribune's Editorial Board is advocating for a broader tax base by keeping the remaining state portion of the food tax (1.75% on unprepared food) and by levying a tax on services, such as lawn maintenance, hair cuts, etc.

CORC thinks that there is a better way to broaden the tax base and fully remove the sales tax on a basic necessity - food.

There are currently over $441 million dollars worth of items that sales tax is not collected on; money that would otherwise go to the state (plus $166.8 million that would go to cities/counties). While there are many items on the exemption list that should be tax exempt, such as prescription drugs, hearing aids, renewable energy equipment, and others - there are many items receiving exemptions by the state that aren't as worthy.

There are currently no state sales tax dollars being collected on:

Coin operated amusement devices - revenue lost = $694,000
Ski resort equipment - revenue lost = $502,000 in 2005 (this number has been much larger)
Automobiles bought by non-residents - revenue lost = $5,586,000

Many other exemptions that might be considered corporate welfare.

Thus, CORC advocates for a special considerations of all purchases that are currently tax exempt. This consideration should bring more tax dollars to the state, thus broadening the base.

What ideas do you have for broadening the tax base AND fully removing the highly regressive, highly unfair sales tax on food?

Thanks

Linda and Adam:
Thanks for a very helpful Annual Meeting - we need to do it more than once a year. I thought Dorothy's observations on the food tax bill possibilities were very helpful. I like the idea of concentrating on one or two vital issues until we either succeed or get skunked.
Ron Holdsworth