Utah Tax Reform

Utah Tax Reform

Daffodil Buchert

On December 12, 2019, the Utah legislature passed a tax reform that sparked an immediate backlash and controversy from citizens and lawmakers alike. A petition to put a referendum concerning the reform on ballots in November was quickly created, and got more than 150,000 signatures; far more than what was necessary to get it on the ballot. In the face of such a negative response to the tax reform, state leaders announced on January 23, 2020 that the reform would be repealed by the legislature soon after it went into session on January 27, 2020. 

The tax reform had extreme effects on many goods and services that would affect everyone in Utah, especially, and disproportionately, citizens near the poverty line. The tax reform included new policies like increasing the tax on grocery sales and adding new taxes to services previously left untaxed, like pet care, streaming services, and ride services such as Lyft. While lawmakers estimated that the reform would cut Utah’s income tax by about $630 million, the estimation of increased sales taxes was $475 million. This is lower than the estimated cuts to income taxes, but the way the cuts and increases would occur, those near the poverty line would be disproportionately harmed. The grocery tax especially would increase their difficulties to afford food, while only giving them a little back in income taxes. The estimated cuts to income taxes would also give more back to those who already earn more money, rather than helping out those who benefit from returned money much more. In short, the reform would have perpetuated the institutionalized classism that decreases the standard of living for the majority of the American population. 

Not only would the reform have affected physical resources, it would have dissolved the Utah government’s education fund or “pot”, transferring the money to the general “pot”. Instead of having a definite reserve of money for public education of Utah students, their money would have been mixed up with other money used for things like infrastructure, leaving the possibility of no money for schools to use. This aspect of the reform seems to be a thinly veiled way to spend less on money, causing students and teachers alike to have less opportunities, and for students, a decreased standard of education. Already, the government is neglecting school funds, making many teachers pay for classroom amenities out of their own pocket. Schools that have students at or below the poverty line would have had less resources to help their students, and overall, students would graduate high school far less prepared for adulthood.

The good news is that after a month of extreme backlash from citizens and lawmakers alike, lawmakers announced that the tax reform would be repealed. The tax bill was repealed during the first week of the Utah legislative session in January. While this is a win for Utah citizens right now, officials say a tax reform will still need to be drafted and enforced, leaving people with the question, what will change, and will it be more proportionally fair to people of different classes and incomes?



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