Food tax up for re-examination

  • By Kelly Sullivan
  • Monday, March 16, 2015 11:30pm
  • News

This evening the Kenai Peninsula Borough Assembly will re-examine the Winter Grocery Tax Exemption enacted in 2009.

The ordinance, introduced by assembly member Blaine Gilman, would repeal the seasonal exemption from sales taxes on non-prepared food items for nine months of the year.

Since it was passed, the borough has seen a reduction of more than $16 million that could have been collected in sales taxes, Gilman wrote in a memo to assembly president Dale Bagley.

In 2014 $3.3 million additional funds could have been collected through the tax, according to the ordinance.

Gilman said the additional taxes will assist the borough to adequately fund education on the Kenai Peninsula.

“In fiscal year 2015, the maximum amount (the cap) that the borough could have funded education was $47,507,198,” Gilman wrote in the memo. “The borough appropriated $44,000,000 for education. This ordinance would make more funds available.”

If approved by the assembly the ordinance would take effect June, 1, 2015.

“It is a sustainable funding source for education,” Gilman wrote in the memo.

Bagley included a supplemental ordinance that would reduce the sales tax collection from nine months of the year to six months of the year.

James Price, who has been fighting the sales tax for more than six years, released a statement for Alaskans for Grocery Tax Relief now.

“These ordinances disenfranchise the will of the voters and could end the grocery tax exemption,” Price wrote.

Homer resident Mary Griswald said taxing food is regressive, in a written public comment to the assembly. Seasonal relief is helpful for full-time borough residents, she said.

“Raising the limit of individual sales subject to tax would be a better solution,” Griswald said.

The assembly will be taking public comment on the issue at the meeting at 6 p.m. this evening in the borough building in Soldotna.

Reach Kelly Sullivan at kelly.sullivan@peninsulaclarion.com.

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