Op-Ed: Schools First History
From The Knox News-Sentinel:
Back to the cigarette tax-food tax debate
April 25, 2007
Action in the Legislature this week - possibly even today - should return our attention to the debate over raising the state’s cigarette tax and what appears to be its corollary, reducing the tax on grocery food items.
To recap: Earlier this year, Gov. Phil Bredesen proposed an increase of 40 cents in the state’s tax on cigarettes, bringing the total to 60 cents per pack but remaining well below the national average of about 90 cents.
Most of the anticipated $220 million from the increase would go to kindergarten-through-12th grade education. About $15 million would go for anti-smoking campaigns and $6 million for agricultural projects.
Republicans countered with a reduction of the tax on grocery food, phasing out the 6 percent tax over a 12-year period. The GOP later ditched that and offered a plan to eliminate the tax on all groceries for December.
A Democratic plan offers to eliminate the state and local sales taxes on milk, eggs and baby food beginning Jan. 1, 2008. That plan already has won subcommittee approval.
Bredesen’s proposal faced rough sailing through the House Agriculture Committee earlier this month. The panel voted to slice the governor’s plan in half and eliminate using the revenue for education.
The committee also eliminated the anti-smoking campaign and put more money on agricultural projects and the remainder to reduce the tax on a number of food items.
Thankfully, the budget subcommittee of the House Finance Committee voted last week to restore Bredesen’s plan. The panel is waiting for a revised estimate of the fiscal impact before moving ahead. That apparently is where things stand now.
The Senate Finance Committee is awaiting House action. The outcome remains uncertain.
Another proposal, backed by Tennesseans for Fair Taxation, is sponsored by Rep. Harry Tindell, a Knoxville Democrat, and Sen. Tim Burchett, a Knoxville Republican, and 20 other lawmakers of both parties. That measure would raise the tax on cigarettes by an additional 4 cents while reducing the tax on grocery food from 6 percent to 3 percent.
Proponents contend that Tennessee ranks highest among the 20 states that tax food, with an average of 8.35 percent when state and local taxes are combined. Tennessee also has one of the lowest taxes on cigarettes among the 50 states and District of Columbia.
Efforts to reduce the tax on food might be largely about scoring political points with voters. If lawmakers were genuinely concerned about food taxes on lower-income citizens, they would have done something about it years ago. They have had their opportunities.
Regardless, Republican and Democratic plans to reduce the tax on food are moving through the Legislature along with the governor’s proposal to raise the tax on cigarettes.
Accepting the former to secure the latter might be the cost of doing business in Nashville’s political environment.
And that will be OK, as long as lawmakers of both parties keep their eye on the real prize - an opportunity to channel more funds into improving education in the state. It is an opportunity that legislators should not risk losing.
