Day of Mourning Actions in Four Cities
July 2002
On July 15th, TFT members in four cities held press conferences
and called for a "Day of Mourning" as the new sales tax took effect. With press
events in Knoxville, Chattanooga, Nashville, and Jackson, members wore black
armbands in recognition of the additional financial burdens placed on the backs
of middle-income and low-income families, as well as the damage the new tax
will do to the state's economy.
When combined with local option tax rates, the total rate was
increased to as high as 9.75% in some counties. Unfortunately, Tennessee now
has the highest average state and local sales tax in the nation according to
the Sales Tax Clearinghouse, a private business specializing in sales tax collection
for interstate businesses.
As board member John Stewart stated, "The General Assembly's action
has taken everything that was wrong with Tennessee's tax system and made it
worse." Or as TFT Board Chair Rachael Bliss asked in an AP story, "What superlative
can you use? It's higher than being the highest. It's worse than being the worst."
With the new sales tax hike, a huge financial burden was dumped
on the backs of the working poor and middle-income families, along with the
elderly and disabled who live on fixed incomes. These are the very same families
that would have actually saved had legislators acted wisely and passed the Naifeh
Plan for real tax reform.
The increase was bad for business too. The flow of consumer dollars
to states bordering Tennessee, mail order catalogues, and the Internet will
be even greater. According to Dr. Bill Fox, UT Center for Business and Econ.
Research, each 1 cent hike in the sales tax costs the State over $800 million
in retail sales generally, and 5,000 jobs.
Through these events, TFT brought more media attention to the
inadequacies of the state sales tax and the need for tax reform. Over 7 TV stations
covered the events along with dozens of newspapers and radio. Thanks to all
who helped organize these press conferences!
A Victory Despite the Sales Tax Hike
After years of pressure to repeal the unjust food tax, legislators yielded in
the final hours and excluded grocery items from the sales tax hike. Now, for the
first time in state history, there is a separate sales tax rate for groceries
than for other items. Although we still have the nation's highest food tax, this
victory sets an important precedent that we can build upon in the future.
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