THE HEARTLAND INSTITUTE: Oregon Considers Constitutional Ban on Grocery Taxes

A new measure was recently approved to appear on Oregon’s 2018 ballot that would amend the Oregon Constitution to permanently prohibit the imposition of a tax “upon the sale or distribution of groceries.” This prohibition — which, if approved, would be the first of its kind in the nation — would not include taxes on alcohol, tobacco, or marijuana. Oregon currently has no statewide sales tax, but there is no law currently on the books to prevent local governments from imposing such a tax. Oregon does collect certain business and excise taxes from consumers, including liquor and tobacco taxes, lodging taxes, and telecommunications levies.

The measure would also freeze Oregon’s corporate minimum tax, another reform that would help reduce the tax burden on state businesses and make the state more competitive.

Grocery taxes are controversial and can have a dramatic effect on families by making food purchases more expensive and procuring healthy foods more difficult. Many states have moved away from these taxes because they place an unnecessary burden on lower-income people. However, 13 states and many localities continue to tax the sale of groceries. Oregon’s proposed ban would prohibit any “sales tax, gross receipts tax, commercial activity tax, value-added tax, excise tax, privilege tax, and any other similar tax on sale of groceries.”

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