Editorial
Move ahead now with tax relief on food

Monday is the final day of the Legislature’s 2008 regular session. Our lawmakers will have a choice between a tax fairness plan that includes total elimination of the state sales tax on groceries, and one that is more modest although it’s a step in the right direction.

Alabama Arise, a lobbying group for poor people backed by 152 religious congregations and community groups, backs the first plan. It would remove the entire 4 percent state grocery tax as well as the deduction on state income taxes for federal taxes paid. The plan also would expand tax deductions for everyone, immediately raising the income tax threshold for a family of four to $20,000 from $12,500.

Gov. Bob Riley has proposed the rival plan. He calls it a compromise, but it apparently hasn’t resulted from any negotiations with Alabama Arise and its allies.

Mr. Riley would cut the grocery tax to 1 percent; raise the income tax threshold to $15,500 over five years; implement a 200 percent income tax deduction for health insurance premiums paid by small businesses and their employees; and let people vote on going back to annual property-tax reappraisals.

This state’s tax system has been tilted against lower-income people for decades. The current economy is especially hard on them, with food and fuel prices soaring. Alabama Arise has the better plan because it would give them more immediate relief.

Rising food prices have caused some lower-income people to rush supermarkets in the early-morning hours of the first day of each month, The Associated Press reports. Their food stamps didn’t last through the previous month, and by the time the new month arrives with its food-stamp allotment, they and their children are hungry.

People don’t pay sales tax on food stamps, but this story shows how desperate some of the needs are. Obviously a tax break would help poor people who are fortunate (is that the right word?) enough to have a little cash to supplement their food stamps.

Mr. Riley’s plan to return to four-year property tax appraisals raises complicated issues that should not be linked to the grocery tax. It would save taxpayers money in most years, although it could deny them immediate tax benefits if their house values went down. But it would cost government agencies money, and for that reason it probably can’t pass this session.

The Legislature should move forward now by passing a tax fairness plan along the lines being promoted by Alabama Arise, giving citizens the right to vote it up or down.

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