Gov. Laura Kelly said today that that her plan to “Axe the Food Tax,” ending the sales tax on food, will save the average Kansan family $500 on their annual grocery bill.
“For too long, Kansans have been paying more for groceries than people in almost every other state,” Gov. Kelly said in a press conference with weekly and small publications.
She said the state can cut food sales tax and keep Kansas’ budget intact thanks to fiscally responsible decisions they made before and during the pandemic.
When asked about the timing of the plan, Gov Kelly said, “Anybody who knows me knows that I am incredibly fiscally conservative. I don’t like to spend money I don’t have, and it really wasn’t until this time, in this budget cycle, that I am very comfortable that we have the revenues to cover the elimination of the food sales tax and will be able to sustain that going forward.
“We have been very responsible over the past three budget cycles,” she said. “As people know, we have fully funded our schools and we are on the brink of actually closing the bank of KDOT so we will no longer be robbing the highway fund to fill holes in the system. We are in good financial shape, we’re solid, this is sustainable, and this is the right time to do it.”
The details of the plan are to eliminate the state sales tax on food immediately, the governor said in answer to a question.
“We have the money available to us right now to go ahead and fully eliminate the 6.5% state sales tax on food. So it will go away as soon as the bill becomes law and the law takes effect. It could be as early as April 1, but more likely July 1st,” Gov. Kelly said.
Gov. Kelly said she is optimistic about the food sales tax passing.
“Given the revenues that we have coming in now and given most people’s interest in doing something about the food sales tax – and given that the Speaker of the House and Senate President have both voiced support – I am optimistic,” she said. “The real trick here will be to get it through the legislative session cleanly – which means this bill will be introduced as a complete elimination of the state food sales tax with nothing else married to it so we can implement it even sooner.”
The overall fiscal impact on the state of removing the state food sales tax is about $450 million a year, Gov. Kelly said.
“In terms of the impact on locals, this bill will have no impact,” she said. “The local sales tax rates are set by the local officials and there will be nothing in this bill that would impact their ability to continue to control those rates in concert with their citizens.”