How do tax credits and exemptions work in Kansas?
A Kansan who spends $150 a week at the grocery store pays more than $500 a year in state sales taxes on those purchases. It’s the second highest food sales tax rate in the country.
It’s deeply unfair. For years, we’ve said Kansas should cut sales taxes on food, giving poor and middle-income Kansans a real break at the checkout line.
So it’s disappointing that Gov. Laura Kelly said Monday that she’s appointed a tax reform council that won’t make final recommendations for 18 months, well after next year’s legislative session and the next election. That may mean a food sales tax cut will be postponed until 2021.
Kansans should demand tax relief next year in a simple, clean measure with broad bipartisan support. It’s extraordinarily important that ordinary Kansans get a tax break.
It’s also important for lawmakers in the state House and Senate make their positions on food sales tax relief clear well before November’s election. Kansans have a right to know where their lawmakers stand.
That wasn’t the case in the 2019 session, when Republican leadership jammed through massive tax cuts for corporations and wealthy individuals with a modest food sales tax cut tacked on to the measure. Those misguided efforts were a poorly-disguised sop to the rich.
In fact, there is now growing evidence that corporate tax rates are too low in Kansas. In August, the state’s revenue report showed modest year-over-year revenue growth from individual income taxes and sales taxes. By contrast, corporate income tax collections are down more than 27%.
If Kansas is doesn’t have sufficient funds for schools, roads and health care, it’s because corporations aren’t paying their fair share — not because consumers and wage earners are paying too little.
Kelly’s new revenue council will figure this out fairly quickly. The 11-person council will hold its first meeting in late September and issue an interim report this December. “There’s a need for tax reform designed with adequacy, equity and stability in mind,” Kelly said in a statement released Monday.
On Tuesday, her office said the council may make recommendations for lawmakers to consider next year. A food sales tax reduction must be on that list.
Kansans will have no objection to a broad study of property taxes, income taxes and sales taxes in the state. The disaster of the Sam Brownback tax cut experiment should not deter the state from making sure its taxes are low, simple and fair — or that its schools, roads, and health care are fully funded.
But food sales tax reductions are simply too important to delay any longer. Food sales taxes in Kansas are too high, period. The problem is particularly acute in the Kansas City region, where shoppers can easily take advantage of much lower rates (that $150-a-week shopper can save more than $400 a year in taxes by purchasing groceries in Missouri).
Kansas must enact a significant food sales tax cut in 2020. The governor’s tax reform council cannot be used as an excuse for inaction or delay.