Senate approves plan to phase out sales tax on food, sending measure to House

Senator Floyd Latta, floor sponsor, introduced Second Substitute Senate Bill 22 as a three‑year phased removal of the sales tax on food, beginning with income‑tax credits. "This bill is the bill that deals with removing a sales tax from food in a phased out program over the next 3 years," Latta said, and framed it as relief for constituents who would directly see more discretionary income.

Supporters, including Senator Howe, argued the tax cut would spur local spending and economic growth; proponents emphasized widespread constituent support and that Utah remained one of the minority of states still taxing food at the retail level. Opponents pressed fiscal concerns. Senator Montgomery and others highlighted the projected revenue losses cited on the fiscal note — including an $89 million first‑year impact (driven in part by calendar/fiscal year timing) and larger multi‑year reductions — and warned about impacts to the Uniform School Fund and bond service obligations. Senators said the bill’s early years require income‑tax credits that create a larger immediate fiscal hit, even though the sponsor described the long‑run change as a tax cut achieved via economic growth.

Floor debate touched on practical complications for merchants (partial cuts across state and local rates), the treatment of Internet sales, and whether local governments would retain sales tax authority. After extended discussion and summations, the roll‑call vote passed the second substitute. The clerk recorded 25 ayes and 9 nays and the bill was transmitted to the House for consideration.