SALT LAKE CITY, Utah — Organizers are calling on Utahns to sign a referendum that puts a recent tax reform bill on hold until residents can vote on it this fall. The group says the proposed tax reform hurts taxpayers, businesses and consumers.
The group has to gather around 116,000 signatures by Jan. 21 to get the issue on the ballot in November. As of Friday, 3,400 people have signed the petition and the group has raised more than $28,000 to pay for the printing of signature packets.
The legislation raises food, fuel and service taxes, which referendum organizer and former state legislator Fred C. Cox says hurts Utahns in several ways.
“Not only is raising taxes on food wrong, raising fuel prices bad, taking money from education questionable,” the referendum organizer’s response said. “The whole idea of moving all sales tax money away from roads […] is wrong.”
Cox pointed to several different ways the tax increases affect Utahns, saying the Utah TaxPayers Association “made many errors in its efforts to clear up ‘myths, misunderstandings and falsehoods’ about the bill.”
Food Sales Tax
The proposed legislation seeks to increase the state sales tax on food and food ingredients. The increase will jump from its current 1.75% to a 4.85% sales tax, according to the bill.
Cox said “raising the food sales tax 177% causes families to have less cash every time they buy groceries.”
Cox added that this increase will affect low-income families, as they don’t have the resources to pay an accountant that will ensure the government will repay them later.
“Why should a family making it without the government be pushed into requiring help?” the statement said.
The tax reform bill, if passed, would also increase the tax on motor fuel and special fuel other than diesel, according to the bill. Cox argues this increase would harm Utahns that drive around town by giving them less money to buy food.
“These added fuel costs will drive up the cost of goods at the register as well,” Cox said.
Education Tax Reduction
One of the bill provisions will repeal certain transfers from the General Fund to the Education Fund, the bill says. However, the bill states this will not hurt public education.
“Reducing general funds to public and secondary schools will mean other taxes will go up to replace those,” Cox said. “Likely, property and school district taxes will have to go up to make the difference.”
In his response, Cox said either legislators would have to change the Utah constitution or “make sure property taxes go up.”
Future of the Referendum
Cox notes that the referendum won’t directly change the law — it will only freeze the bill until voters can directly vote on it in November.
“The UTA wrongly claims the referendum will hike taxes,” Cox said. “It only puts the tax reforms on hold until voters decide its fate.”
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