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Benny Petrus has a point, but Mike Beebe is in a box. Petrus, the incoming speaker of the state House of Representatives, says that repealing the sales tax on groceries — Beebe’s centerpiece of a campaign promise — is not the best way to help Arkansas’s working poor people.
Carving out personal income tax cuts from the lowest incomes upward until you’ve granted as much monetary relief as you’d bestow with grocery tax removal — that’s a better way to go, Petrus says.
His plan would target those actually needing help. It would let the state extract tax proceeds from, for example, the thousands of people from out of state who come to Benny’s region over around Stuttgart to hunt ducks a couple of months every year.
Petrus wonders why we would give a drug dealer or an illegal immigrant a break on groceries when we could give a law-abiding and low-income working man a break on his state income tax?
Petrus, who sells cars for a living, was selling this argument to me, and I was buying.
I asked him what Beebe had said about it. He said Beebe “seems pretty tied down” to his campaign promise to phase out the sales tax on groceries.
Petrus told me he understands that the food tax phase-out “polled well” for Beebe in the governor’s race, and he emphasized that he’ll be on Beebe’s side 95 percent of the time. He, like Beebe, is a fairly typical Arkansas Democrat with center and center-right leanings and a rural sensitivity.
But on this one issue, albeit the main one, Petrus simply thinks he has a better idea. And he says it’s his idea alone. I asked him which lobbyists had brought it to him. He did not seem to appreciate the question. Ever since term limits, I catch myself asking legislators things like that.
Even if Beebe saw the greater justice and wisdom in Petrus’ notion, as I rather think he does, he’d be hard-pressed to admit it. That would burden him right out of the gate with having to explain to the people who’d voted for him that he wasn’t going to do precisely that main thing he’d promised during the campaign to do.
But Petrus has a suspicion that people aren’t going to understand something else — that Beebe does not intend to touch city and county sales taxes on groceries. He thinks they’re not going to like reading in the newspaper that the tax is removed, then seeing the remains of it at the bottom of a long supermarket receipt.
Beebe will fall back on the injustice of the grocery tax generally. He’ll probably prevail, since a Democratic legislature is not going to let the first Democratic governor in more than a decade lose his signature issue.
But Beebe will have to win a legislative fight rather than an argument, because Petrus is right.
Let’s say Beebe proposes to remove half the sales tax on groceries. That’s $120 million taken annually from the operating budget, given to taxpayers who buy food, meaning all of us.
The dollar benefits will accrue in proportion to the amount and price of food one buys. The rich guy will pay no sales tax on fresh shrimp flown in from the Gulf yesterday. The poor guy will pay no sales tax on macaroni and cheese.
True, the percentage of over-all income is more for the poor guy and his macaroni and cheese. But Petrus would give all the $120 million to the poor guy.
Getting rid of the grocery tax will be a good thing. It’s just won’t be the best thing.
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