SALT LAKE CITY — Talks are apparently under way on Utah's Capitol Hill about eliminating the state portion of the sales tax on food, as well as removing the earmark on the income tax for public education.
Governor Spencer Cox revealed the discussions during an appearance on Tuesday at the Utah Taxpayers Association's annual conference previewing the upcoming legislative session.
"We are going to have discussions about getting rid of the tax on food this session. That’s definitely on the table. I know those discussions are happening. We're supportive of those discussions," he said. "We’re also looking at removing the earmark."
The earmark dedicates income tax money to fund public education. Recently, Utah voters amended the state constitution to include social services in that funding mechanism. But it's unclear how serious the discussions are.
"If we did go down that direction to either eliminate the earmark or modify, no matter what we do it would have to be approved by the voters via a constitutional referendum," said Rep. Steve Eliason, R-Sandy, who chairs the House Revenue & Taxation Committee.
Asked how likely it would emerge in the legislative session, Rep. Eliason told FOX 13 News: "I think someone will propose it. I can’t predict how much traction it will get."
The Utah Education Association, the state's largest teachers union, had no comment on the idea. Voices for Utah Children, a nonprofit child advocacy group, appeared ambivalent.
"Obviously it hasn’t done us any good," said Matthew Weinstein, Voice for Utah Children's policy director. "We’re next to last in the nation on per pupil investment in education. We have some of the highest turnover for teachers."
Rusty Cannon, the president of the Utah Taxpayers Association, was supportive of eliminating the earmark.
"That needs to be done. We're virtually the only state that has this problem," he said.
When it comes to education spending, Senate President J. Stuart Adams, R-Layton, expressed support for giving educators a raise.
"We're probably going to fund directly teacher salaries, as a direct appropriation," he said.
With billions in state revenues thanks to the state's robust economy, lawmakers are feeling increased pressure to cut taxes. While the Utah Taxpayers Association has supported deep cuts, lawmakers at Tuesday's event appeared a little reluctant to go too low. They referenced inflation and the potential for inflation.
"Make no mistake. You’re going to see historic tax relief this session," House Speaker Brad Wilson, R-Kaysville, said. "Primarily because the legislature has been very, very prudent with the way it’s spent money over the past few years. You’ll also see policies aimed at making Utah more affordable."
Rep. Eliason offered up a number of proposals, including property tax reductions and cuts to taxes on Social Security income.
"There’s a lot of people on fixed incomes and when property taxes go up? They don’t have another source of revenue," he said.
The Utah Taxpayers Association has pushed for a deep income tax cut. Right now, the rate is at 4.85%. Cannon said he would like to see it drop to 4.5%.
"The economy in Utah is so robust, things have been so steady there’s just a lot of money in the coffers. The best thing they could do is provide ongoing relief to the taxpayers," he told FOX 13 News.
But when Cannon posed the idea to Gov. Cox, it was rejected.
"Is that something you could get comfortable with?" he asked the governor.
"No. it’s not something I could get comfortable with right now. It’s too deep," Gov. Cox replied. "We are a wise state and we are a smart state and we do this in increments."
While supportive of eliminating the state portion of the sales tax on food, Weinstein said his group would favor not making so many tax cuts and taking the revenues to fund other needs across Utah.
"Over $5 billion in unmet needs," he said. "Most of that’s in education, but there are tremendous needs in other areas, we couldn’t even put a number on it. Like the Great Salt Lake, like infrastructure, like mental health care."
