Scottsdale’s sales tax on groceries could be repealed or modified next month under a proposal from Councilman Tony Nelssen.
Nelssen proposes to either eliminate the city’s 1.65 percent tax on foods bought for home consumption or to offer the needy an exemption from the tax.
The City Council is slated to consider Nelssen’s request on Jan. 8.
“There was considerable concern about why we were taxing food for home consumption in Scottsdale,” Nelssen said Monday. “I guess philosophically we can discuss, ‘Should we be taxed on necessities?’ ”
Currently, Scottsdale levies a 1.65 percent tax on food items bought for home consumption.
That rate is in line with the 1.65 percent sales tax the city places on nonfood items, said Maura Thirkill, city audit associate.
“If you went to a Scottsdale store and bought an orange, you’d see the 1.65 percent on it,” she said.
Nonfood items also carry a 5.6 percent sales tax from the state government, and a 0.7 percent tax from Maricopa County, Thirkill said.
The state and county do not levy taxes on food groceries, nor does Phoenix, according to that city’s Finance Department.
Nelssen has asked Scottsdale finance officials to research how much revenue would be lost by eliminating the tax.
“The first thing we have to find out is what is the impact on our budget,” he said.
The proposed tax cut would not apply to such things as liquor and tobacco, Nelssen said.
The other possibility is to provide some residents an exemption from the grocery tax based on factors like the buyer’s age and economic status, Nelssen said.
“If there’s a way to qualify individuals who could truly benefit, I’d like to have a discussion about that, as well,” he said.