PHOENIX — As Arizonans have seen their bills skyrocket both candidates for governor, Kari Lake and Katie Hobbs, are making promises to help families battle inflation.
"So I want to work with the lawmakers, the legislature to get rid of the food tax," said Lake in a one-on-one interview with ABC15. "We need to save pennies and dollars everywhere we can. And also I want to get rid of the rent tax.”
The grocery tax, or food for home consumption tax, and the rental tax together bring $340 million annually to local governments that have those taxes in place.
Some mayors have said Lake’s plan would impact their cities, with funding from those taxes helping with areas like public safety.
The following is a statement sent to ABC15 on behalf of the mayor of Goodyear:
Local cities rely on rental and sales taxes to maintain the health and safety of our residents. Public safety is our number one priority and maintaining local control of revenue sources is imperative.
I would be happy to sit down and explain the very real impacts this would have on Goodyear and other cities.
Mayor Joe Pizzillo, Goodyear
Lake has said she would use the state’s surplus to help cities for five years.
"Calling for some tax cuts on school supplies, over-the-counter medication, things like that," said Katie Hobbs in a one-on-one with ABC15. "And then we also have a plan to put people back to work and higher paying jobs…”
Hobbs's plan would also impact local governments, but with more specific products as opposed to sweeping cuts, the dollar amount would be less.
For both these plans, Hobbs and Lake would need to work with the legislature to actually put them in place.
According to the League of Arizona Cities and Towns the following breaks down how the taxes impact residents:
Food for Home Consumption
· 70 of 91 cities and towns in Arizona tax food for home consumption.
· The affected cities and towns would lose an estimated $160M annually in revenue if eliminated.
· The average tax across the state is 2.69%, which means the tax for a $100 grocery bill is $2.69.
· Groceries purchased with SNAP and WIC benefits (food stamps) are already exempt, so removing the proposed tax provides no relief to individuals receiving these benefits.
Residential Rental
- 75 of 91 cities and towns in Arizona tax residential rental.
- The affected cities and towns would lose approximately $180M annually.
- The average tax rate is 2.42%. On a $1,500 rent, the tax would be $36.
- Rental rates across the state have increased anywhere between 15%-30% - removing a 2.42% tax is not going to offset these increases.
