The state House has proposed a tax exemption for the use of utilities that go into making food.

Representative Craig Redmon (photo courtesy; Tim Bommel, Missouri House Communications)

Representative Craig Redmon (photo courtesy; Tim Bommel, Missouri House Communications)

The bill aims to exempt the state’s sales and use taxes for restaurants and others who make food to be sold to directly the public for the electricity, water, gas, or other utilities used to make that food.
Representative Judy Morgan (D-Kansas City) said its passage would cost the state.

“It would reduce the total state revenue by $51.2-million, annually,” said Morgan of the bill’s fiscal impact as assessed by state legislative staff. “This is a very bad bill designed for one special interest group. As most bills designed for special interest groups, the taxpayer gets stuck making up the difference.”

Bill sponsor, Representative Craig Redmon (R-Canton) said that estimate is overblown.

“The fiscal note on it took into account things like coolers and freezers, lights and everything else, when in actuality it only takes in electricity on the oven, or the gas used on the fryers,” said Redmon.

He denies the bill is being proposed for a special interest group.

“Yes it will help other people, but when I took this bill on it wasn’t for the big guy, it was for the little guy,” said Redmon.

Representative Lyndall Fraker (R-Marshfield) said taxing both the food and the utilities used to make it is double-taxation.

“Why should the taxpayers, or why should the consumer have to pay tax on a product twice?” asked Fraker.

Critics say a similar exemption has been struck down by the state Supreme Court, but Redmon argues his bill address the Court’s concerns.

The proposal, HB 1448, goes now to the Senate.