Utah’s New Tax Reform Begins Shift from Income to Sales Tax – Broadens Tax Base
Published: January 10th, 2020
“Utah is the only state in the nation that reserves all revenue gathered through income tax for education spending. That means all other state funding has to come through the general fund, which is supported by sales tax. SB 2001 begins by broadening the sales tax to a variety of services that were exempted.”
- Sales tax on food increases from 1.75 % to the state’s 4.85 % rate (local food taxes remain unchanged).
- Exemptions continue for food provided by WIC, SNAP, and charitable organizations.
- A grocery tax credit provides $125/year per person in a family of four, plus $50 per additional child, phasing out above $45,000 household income.
- New exemptions and repeals include:
- Certain former sales and use tax exemptions
- Tangible personal property consumed in performing taxable services
- Menstrual products
- Additional changes:
- Sales tax on motor fuel (excluding diesel) and an excise tax on diesel
- Increased state motor vehicle rental tax
Disclaimer: Tax information is subject to change and interpretation.