GET Exemption for Groceries, Medical Care Stalls

February 10, 2014, 2:53 PM HST (Updated February 10, 2014, 2:54 PM)
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A bill that would remove the state’s general excise tax from groceries and medical services has stalled in the Legislature.

Sen. Sam Slom. Courtesy photo.

Sen. Sam Slom. Courtesy photo.

Introduced by Sen. Sam Slom, Senate Bill 2169 would also make seeds and garden plants, as well as meals prepared for those age 60 and above, exempt from the GET.

Tobacco products and alcoholic beverages would still be taxed.

The bill was scheduled for a hearing last Thursday before the Senate Committee on Human Services, but the committee instead deferred the measure.

According to supporting testimony submitted by the Grassroot Institute of Hawaii, the average family of four in Hawaii spends more than $1,000 a month on groceries and would save about $450 per year in taxes if the bill is approved.

The legislation also has the support of the Hawaii Food Industry Association, which said food in Hawaii costs “as much as 40% more” than on the mainland.

The HFIA described a GET exemption as “a simple and efficient way to get benefits directly to families.”

Both organizations noted that dozens of states exempt groceries from taxes, although they didn’t agree on how many. The HFIA said 36 states don’t tax groceries and another seven have a lower rate for them. The Grassroot Institute said 32 states exempt food from sales taxes.

The bill has also been referred to the Senate Committee on Ways and Means, which has not scheduled it for a hearing.

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