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Minutes for HB2261 - Committee on Taxation
Short Title
Decreasing the sales and use tax rate on food and food ingredients to 5.5%.
Minutes Content for Mon, Feb 18, 2019
Representative Hodge, testified as a proponent to HB2261 stating Kansas is one of fourteen states that tax food which is the most regressive tax that hits working Kansans the hardest (Attachment 2).
Mark Desetti, Kansas National Education Association, testified as a proponent to HB2261 stating KNEA favors the reduction or repeal of the sales tax on food. It would be good tax policy to address some of the regressive tax in the Kansas system but it's also about children's health, nutrition, and access to fresh foods. The higher the sales tax the more low income families have less healthy food alternatives (Attachment 3).
Ashley Jones-Wisner, KC Healthy Kids, testified as a proponent to HB2261 stating the policy barriers in Kansas that impact access to healthy foods is the sales tax rate. Kansas food tax puts an unfair burden on the poor and those in rural areas. Sales tax on food costs the average rural Kansas grocer close to $18,000 per year by reducing grocery sales and forces customers to purchase low quality foods (Attachment 4).
Scott Thellman, Juniper Hill Farms, testified as a proponent to HB2261 stating lowering the sales tax on food will benefit the Kansas economy while putting dollars back into the pockets of Kansas families (Attachment 5).
Doctor Casey Cordts, Pediatrician, Stormont-Vail, testified as a proponent to HB2261 noting medical professionals have found several areas to focus on for change, hoping to curb rates of obesity in the United States. Cost of healthy foods is one of the main factors in improving dietary habits (Attachment 6).
Hally Roberson, City Administrator, Oberlin, Kansas, testified as a proponent to HB2261 stating Oberlin is a rural community in northwestern Kansas bordering the Nebraska state line and Colorado. The food sales tax hits the Oberlin community hard because both of those states have zero tax on sales (Attachment 7).
Rachel Henderson, General Manager, The Marmaton Market, testified as a proponent to HB2261 stating five hundred people in the area are served by the Marmaton market are on low or fixed income. Some residents have to make a decision of paying a bill or purchasing groceries. She noted the reduction in the grocery sales tax would allow Southeast Kansas to make eating healthy food a more affordable option (Attachment 8).
Cherie Thomas-Schenker, Schenker Family Farms, testified in support of HB2261 noting rural Kansas must fight to keep access to rural grocery stores. Eliminating or at least reducing the sales tax on food is a step in the right direction (Attachment 9).
Jon McCormick, Kansas Food Dealers Association, testified in support of HB2261 stating he is in favor of matching or beating the competition around the Kansas borders and to reduce the food tax to zero (Attachment 10).
The following submitted written testimony in support of HB2261:
Tim McKee, Olathe Chamber of Commerce (Attachment 11)
Pat White, Whites Foodliner (Attachment 12)
Valerie Nicholson-Watson (Attachment 13)
Emily Brown, Food Equality Initiative (Attachment 14)
Lisa Markley, Greater Kansas City Food Policy Coalition (Attachment 15)
Michelle Ponce, Kansas Association of Local Health Departments (Attachment 16)
Rita Hartman, Atchison Farmers' Market (Attachment 17)
Jennifer Morris, Kansas Academy of Nutrition and Dietetics (Attachment 18)
Julie K. Brewer, United Community Services of Johnson County (Attachment 19)
Beth Low-Smith, Greater KC Food Policy Coalition (Attachment 20)
Regena Lance, Mildred Grocery Store (Attachment 21)
Kirk Brown, Raye's Grocery Store (Attachment 22)
Opponents:
John Donley, Kansas Farm Bureau, testified in opposition to HB2261 stating that state and federal laws already have tax policies in place to relieve the burden of low income families and individuals from paying state and local sales taxes. He noted SNAP benefits and WIC purchases are not subject to state and local sales tax (Attachment 23).
Eric Stafford, Kansas Chamber, testified in opposition to HB2261 requesting the Committee to not treat candy differently under the definition of food and food ingredients as currently drafted in the bill on Pages 3 and 12 (Attachment 24).
Scott Schneider, Kansas Restaurant and Hospitality Association testified in opposition to HB2261 noting the KRHA opposes creating a discriminatory food sales tax. He stated the provisions in the bill are complicated and penalizes citizens for good food choices. (Attachment 25).
Written testimony in opposition to HB2261 was submitted by Liz Clark, National Confectioners Association (Attachment 26).
Neutral:
Adrienne Olejnik, Kansas Action for Children testified as neutral to HB2261 stating increasing the amount of the food sales tax refund, while broadening who is eligible to receive it, would be a targeted and cost-effective solution to helping working Kansans access healthy food (Attachment 27).
Written testimony as neutral to HB2261 was submitted by the following:
Joey Hentzler, Kansas Appleseed Center for Law and Justice (Attachment 28).
Michael Austin, Kansas Policy Institute (Attachment 29).
Kathleen Smith, Department of Revenue, stated it would require $2.8 million from the State General Fund in FY2020 to implement the bill and to modify the tax system. The bill would require hiring six additional people to answer questions, process, and audit sales tax returns. She noted the Department would not be able to meet the implementation date of July 1, 2019 and would need at least eight months.
Hearing closed on HB2261.
Meeting adjourned at 5:10 p.m.
