Prop 1 will help achieve fair taxation

Posted: Friday, October 03, 2008

Proposition 1 reflects our values and will help us build a stronger community. Please vote yes October 7th, to support seasonal tax relief for year-round Borough residents.

Sales tax on groceries currently target year-round peninsula residents and place a large and growing tax burden on local shoppers. The University of Alaska's Food Cost Survey reported that a local Kenai family of four spends $142 per week for groceries. Based on their March 2008 survey, Proposition 1 will save each typical family over $300 per year in grocery cost. This survey was done when the gas price was $3.59 per gallon. Many families will save even more.

Groceries are not taxed in most lower 48 states or most other Alaskan communities. The current policy of taxing groceries year-round is forcing many local residents and families to choose between food and medicine (medicine is not taxed).

Proposition 1 is designed to provide direct tax relief for local residents at the minimum cost to local government. This seasonal tax relief plan allows local government to collect the lion's share of its previous year-round tax during the busy summer months. This will put Kenai Borough merchants on a level playing field with the sales tax-free policy of our Anchorage neighbors, while eliminating grocery tax for nine months of each year.

The Borough sales tax was increased from 2 percent to 3 percent on January 1, 2008. With much higher energy costs and higher prices on almost everything else, sales tax income to the borough is projected to increase from $18 million in 2007, to over $30 million in 2010. Proposition 1 will allow Borough residents to receive relief from the higher sales tax burden imposed by the Borough.

Politicians not wanting any revenue source to dry up, have used exaggerations and misleading statements to suggest that your worst fears will be realized by passing Proposition 1. You may be told that property taxes will double or that education would suffer. Such exaggerated claims were used in 2002 against our previous effort to end grocery taxes, while recently released Borough financial statements reveal that your taxes were substantially increased anyway.

Politicians have argued that a vote for this ballot proposition is a vote against education. However, Borough budget documents clearly reveal that the amount of sales taxes collected by the Borough does not directly reflect on the amount of educational funding from the Borough. Borough sales tax revenues have increased more than 50 percent without significantly increasing education funding. Don't buy political rhetoric, look for the facts.

Remember that none of the sales taxes collected by the cities is contributed to school funding at all. And finally, the facts are that the Borough funds education to the cap and the state will not allow the Borough to contribute more money.

Don't buy half-truths claiming that our Borough needs your grocery tax revenue. It is simply not true.

Proposition 1 will help achieve fair, equitable and appropriate taxation for all Borough residents. Please don't be fooled by political scare tactics.

Borough sales tax revenue is at an all time high. Proposition 1 can make the Kenai Peninsula Borough a better place to live and a more affordable place to raise your family and eventually retire.

Please do your part by supporting our seasonal repeal of grocery tax.

Vote to end this unfair tax on October 7th by voting yes on Ballot Proposition 1.

James R. Price, Joe Ray Skrha and Fred R. Sturman are the cosponsors for Alaskans for Grocery Tax Relief Now.

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