Most Americans have suffered in one way or another from the recent economic downturn, but money problems don’t just apply to citizens. An overwhelming number of state governments are facing record budget deficits this year. Nevada is projected to be about $3 billion short for the state’s 2-year budget cycle that begins July 1, 2011.
Pete Goicoechea, the Republican minority leader in the Nevada Assembly, has suggested voters subject themselves to a 2 percent sales tax on food to help bridge this budget gap. The proposed tax could bring in half a billion dollars over the 2-year cycle.
“I believe that we should have had a 2 percent sales tax on food on the ballot this fall,” Assemblyman Pete Goicoechea, R-Eureka, said on KRNV-TV’s Nevada Newsmakers.
His proposal runs into a problem, however, because the Nevada Constitution prohibits taxing food that is not intended for immediate consumption, such as Restaurant food. Amending the constitution requires passage by voters in two successive general elections.
Food taxes have always been subject to fierce national debate. Many states have similar laws to Nevada banning the taxes. Washington state is one of these states, and prohibits taxing most grocery items–excluding soda. However, some communities are starting to resort to food taxes in order to cover record deficits. The Phoenix City Council passed a tax on grocery items earlier this year that was designed to save its fire and police departments.
Politicians in Nevada agree that they are facing desperate times and keeping vital services may indeed call for desperate measures. However, some see other places for bueget cuts before resorting to taxing food, one of the most vital components of human survival.
Assemblyman Ed Goedhart, R-Amargosa Valley pointed to excessively high public salaries such as those earned by firefighters as one example of where spending reductions can be made. Additionally, assemblyman Tom Grady, R-Yerington, said any specific tax proposals are premature, and that the idea of going to the voters for an expansion of the state share of the sales tax to include food would not help in the upcoming biennium, reported the Nevada News Bureau.
The proposed tax did not make it onto the November ballot so Nevada citizens have until 2011 to make up their minds about the legislation.