The food-tax shuffle: Ultimately, Dial’s proposal will help well-to-do more than poor
by The Anniston Star Editorial Board
Mar 22, 2013 | 5086 views |  0 comments | 10 10 recommendations | email to a friend | print
It has long been a source of embarrassment that Alabama is one of only two states that taxes food at the same rate it taxes other items.

That the other state is Mississippi only makes matters worse.

Nevertheless, efforts to do away with a tax that falls most heavily on the poor have floundered. Those who benefit from the revenue the tax raises — yes, you, education — oppose the cut unless the money is replaced from another source. Additionally, those who would pay higher taxes to make up the loss — yes, you, affluent Alabamians — refuse to lift the burden from the poor and assume it themselves.

State Sen. Gerald Dial, R-Lineville, is pushing a bill that, following the twisted logic that has characterized this legislative session, might solve the food-tax dilemma.

Dial’s proposal would remove the 4 percent tax on food, 1 percent at a time, over a four-year period. To replace the revenue lost, the act would increase the state sales tax on everything else according to the same formula.

At first glance, replacing one regressive tax with another regressive tax seems futile. If the goal is to lighten the burden on low-income Alabamians, one must remember that they purchase other things other than food. This page agrees with critics of the plan that it would be far better to replace the revenue by eliminating the state income tax exemption that allows residents to write off federal income taxes paid. This exemption, which favors the affluent, is another of the ways Alabama makes things better for the better-off.

However, this is not the Legislature to make so bold and fair a move.

That leaves us with the Dial proposal, which, in a roundabout way, might benefit the poor after all.

Recall that the affluent buy more and more expensive “other things” than do the poor. That’s why, in that roundabout way, the Dial proposal might bring in more sales-tax money for education — and education, it has been shown over and over again, is the key to bringing people out of poverty.

Who knows? This shift in the sales tax might generate enough new revenue to replace what education will lose under the awful Alabama Accountability Act. But even if the monies even out, in the end no one in Alabama will get ahead except those who are already out front.
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