SALT LAKE CITY -- Associated Food Stores has become the latest to allow signature-gathering for a referendum challenging the Utah State Legislature's tax overhaul bill.
Associated Food Stores told FOX 13 it had no position on the legislation itself, but would allow referendum supporters to use some of its stores to gather signatures to qualify for the ballot, if asked.
"As Associated Retail Operations (Macey’s, Dan’s, Lin’s, Fresh Market and Dick’s Market), we do not have an official position on the tax reform package," the company said in a statement to FOX 13. "We feel citizens, if they want, can have their voices heard on this matter and that is why, if asked, we’re allowing the collection of signatures in our stores."
On Thursday, Harmons Grocery came out in support of the tax referendum and announced it would open all of its stores across the state for signature-gathering efforts. Harmons said it specifically objected to the food tax hike in the tax reform package. It raises the cost of the sales tax on groceries from 1.75% to 4.85%.
In an interview with FOX 13 on Friday, Harmons President & CEO Dean Peterson said the company did not lobby on the bill when it was before the legislature, but is taking a stand now.
"Taking a position sometimes is what we have to do. I know oftentimes in our business, it’s safe to stay out of politics and stay neutral. But in this case we feel like we need to take a stand," he said.
Peterson said the company would like to see the food tax repealed entirely.
"Our opinion is there should be no tax on food, just like there’s no tax on medication," he told FOX 13.
Lawmakers have countered that through their reform package, people on the lower income scale will have grocery credits and other tax breaks that make it easier. Faced with a potential fiscal cliff, lawmakers in special session last month passed a bill that cut the income tax by $160 million, but also hiked the sales tax on food, gasoline and imposed new taxes on some services.
"I am confident if people fully understood the benefits of the tax reform bill, most individuals would be dissuaded from signing the referendum," Senate President J. Stuart Adams, R-Layton, said in a statement to FOX 13 on Friday. "The tax reform bill creates a grocery tax credit, implements a $160 million tax cut, creates a Social Security credit and expands the Utah dependent exemption giving low to moderated families thousands of dollars. The tax reform bill will help ensure Utah remains the number one state for the economic outlook and supports upward mobility for everyone."
GOP leaders on Capitol Hill have argued it is necessary as people buy less goods and more services, and sales tax revenues (which are in decline) pay for essential government services. The income tax is earmarked exclusively for education.
"Over the course of the past year, we heard from thousands of Utahns including citizens, businesses, and other community stakeholders. We appreciate and encourage all forms of civic engagement, but find it disappointing that Harmons Grocery and Associated Foods Stores did not participate in the tax reform process until now," said House Speaker Brad Wilson, R-Kaysville, in a statement late Friday. "We encourage all to become informed on the many ways this bill benefits Utah families."
Volunteers intend to set up tables starting Saturday in every Harmons to allow for the effort, and Macey’s, Dan’s, Lin’s, Fresh Market and Dick’s Market stores might see them soon.
The move by Harmons brought a strong statement from the Utah governor's office criticizing the company, but earned the grocery chain a lot of praise from customers who took to social media.
Of the governor's comments, Peterson said they respectfully disagreed.
"A high, high number of comments and information we’re getting is all positive about this," he said.
Associated Food Stores also allowing signature-gathering represents a large chunk of Utah's grocery stores who appear to be pushing the referendum. Kroger, which owns Smith's Food and Drug, did not immediately respond to requests for comment.
The referendum, which would force a public vote on the legislature's tax overhaul bill, must get approximately 116,000 signatures across the state by Jan. 21 to qualify for the November ballot. As of Friday, the Lt. Governor's Office said they had verified 11,128 signatures.
Fred Cox, a former Republican state legislator who is one of the sponsors of the amendment, told FOX 13 he believed Harmons and other grocery stores jumping in is "a big deal."
He said it could help them collect signatures for the referendum, particularly in larger counties. Some, like Emery and Kane counties, have already met their signature requirements.
"This will help dramatically in the bigger counties," he said.