OK. Maybe it is a brilliant political maneuver, new Gov. Mike Beebe’s vow to cut the sales tax on groceries in Arkansas. It has given him several advantages.
Meanwhile, the state is among the poorest in the Union, and reducing even an inherently unfair tax will tax what feeble services Arkansas manages to offer: education, highways, law enforcement and on down the line. Everyone eats approximately the same, and thus a value-added tax on food costs the lower-income person more than the higher-income person. (Yes, Spam is cheaper than steak, especially USDA Choice, locally raised grass-fed cow, but the point remains.) Everyone is accustomed to sales tax on virtually everything. Here, the state takes 6 percent and localities take a bit on top of that. No one has starved for want of 6 to 9 pennies for a dollar loaf of day-old bread; no one will eat better for 3 extra cents, especially without a stable revenue replacement.
First, Beebe won last November, with the grocery tax cut prominent in his campaign. A Democrat promising a tax cut. Voters believed him, and he’s carrying it through. The bill he eventually presented was to halve the tax on grocery items to 3 percent. This prevents the complexity faced by those states that have altogether killed the food tax, which is defining what’s a non-taxed grocery item and what’s a taxable prepared food item.
Friday, the state House approved the 3 percent tax on a 99-0 vote. Previously, the state Senate approved the cut 35-0. Let’s hope that the other significant bills, say on school reform and biofuels, pass with as much enthusiasm.
Second, no matter what happens, the statehouse veteran (Beebe was a legislator then Arkansas attorney general), can say he was following the will of the people, as was every member of the General Assembly.
Third, Beebe will have a focus for the remainder of his four-year term when the state starts coming up short financially. You’d hate for the guy to ask at the end of 2008, what do I do for the next couple of years? Shorting the state treasury gives him a multifaceted project. Hey, it’s like what Iraq has done for George W. Bush. -30-
