August 2, 2009
Chicago Tribune Interviews Director of Policy and Communications Bill Ahern on Complicated Sales Tax Exemptions
"Candy or food? Confusion grows as new tax looms"
By Ameet Sachdev and Bob Secter
Taxes are rarely simple, but some revisions to the state sales tax slated to go into effect Sept. 1 are fraught with headache-inducing complexity that could make routine grocery shopping more expensive and deciphering the register tab far more difficult. ...
Bill Ahern, a spokesman for the non-partisan Tax Foundation in Washington, said carving out narrow taxes and exemptions creates an administrative nightmare for small retailers while giving an advantage to highly computerized retail chains that can spread costs of compliance over multiple stores.
With states pressed for cash, tax logic is becoming increasingly strained and inconsistent, Ahern argued, pointing to a New York decision that Ovaltine is deserving of a sales-tax exemption but Tang is not. Another example: Iowa officials decreed a few years ago that although pumpkins sold for pies were exempt from sales taxes, pumpkins sold for jack-o'-lanterns were not. The ruling led to protest and was quickly rescinded.
"There's no scientific basis for a lot of these taxes," Ahern said. "These are just political, arbitrary decisions that juggle what is deserving of an exemption and how much money they want to generate."
