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Tennesseans Ring in the New Year with Extra “Change”

December 31, 2007

Nashville, TN – Tennesseans will be ringing in the New Year with "change" in their pockets when a one-half percent reduction in the food tax goes on the books January 1. Some estimate that this savings will buy almost a weeks' worth of groceries for the average family.

Tennesseans for Fair Taxation board member Phil Schoggen says one of his group's New Year's resolutions for 2008 is to work toward getting an even bigger food tax reduction.

"It recognizes the principle that it's wrong to tax life's required support, like food."

The group's goal is to eliminate the sales tax on food entirely. That concerns people who are worried about losing state revenue. However, Tennessee could stop taxing food altogether and still break even, Schoggen points out, by closing a corporate loophole that allows some multi-state corporations to avoid certain state taxes. He says 21 other states have done that.

"Their own state laws have similar loopholes, and they've moved to close that loophole and gain the income as a result."

Even with the half-percent reduction, Tennessee's food tax is the third-highest in the country.

Deborah Smith/Craig Eicher, Public News Service - TN