Ending Oklahoma's tax on groceries included in budget proposal

OKLAHOMA CITY (KOKH) - House democrats unveiled a three-pronged budget proposal Tuesday, three weeks before the end of the legislative session.

Included in the proposal is an end to the grocery tax in Oklahoma. As it stands now, Oklahomans are charged sales tax on groceries.

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"We are one of 13 states that charge a tax on a carton of milk," said Rep. Forrest Bennett in a news release. Nearby Texas, Colorado, and New Mexico all do not charge sales tax on groceries.

Oklahoma is also one of only 7 states where groceries are taxable at a full rate. States like Arkansas and Missouri charge sales tax on groceries, but at a lower rate.

Other states, like Idaho, offer a grocery tax credit to offset the sales tax people spend on groceries throughout the year. That credit ends up averaging around $100 a year.

Oklahoma House Democrats say ending a grocery tax would save Oklahomans $257 million a year on grocery costs. Lawmakers also say it will lower the tax burden for Oklahomans.

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A 2020 study by the Center on Budget and Policy Priorities shows sales taxes worsen income and racial inequalities. The study also shows sales taxes on groceries have an even more harmful impact on low-income families who tend to spend a larger share of their income on groceries.

The federal government already exempts grocery purchases made using food stamps from sales tax, but the CBPP study shows that not all low-income families are eligible to receive those benefits.

You can read more about the House Democrats' budget proposal here.

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