A national campaign to repeal sales taxes on diapers and other personal hygiene products stalled in California, but has recently picked up steam in Arizona through Rep. Daniel Hernandez’s HB2217.
|House Ways & Means Committee Vote – HB2217|
The fiscal note on the bill, shows it will cost the state approximately is $13 million in revenue.
The total cost of the bill is really an unknown with the original cost estimated to be between $11 to 30 million annually.
Although sales taxes, which are regressive in nature, are opposed by democrats and progressives, the diaper bills will not help the most in need. They argue that while communities will lose much needed revenue, the average resident will not experience any meaningful savings. At the same time, the real beneficiaries are the diaper banks.
As a result of similar bills’ failure to provide real relief for the needy, diaper banks have been unable to score a win. In California, the first run at a passage of a diaper bill was thwarted by Governor Jerry Brown, who vetoed it. The second run in May 2017 was even less successful when the California Assembly’s Revenue and Taxation Committee blocked Assembly Bill 479.
In Arizona, Hernandez’s bill passed out of the Ways & Means Committee in late January thanks to the votes of reps. Michelle Ugenti-Rita and Jeff Weninger. Given the failure in California, many were surprised Speaker of the House JD Mesnard entertained it at all, but Mesnard “double assigned” it to the Ways and Means committees ensuring that it would not make it out of committee and to a vote of the whole House.
In fact, Health Committee chair, Rep. Heather Carter held the bill last week. Now, Carter and Hernandez are expected to slip the bill into budget negotiations.
The fact that the bill was assigned at all is chalked up to an election year gimmick. Hernandez, who has been a disappointment to his constituents, will be able to go back to southern Arizona and either tell voters that the mean old conservatives killed a bill that would be life-changing, or that he slipped one past taxpayers in a late-night-fuzzy-math budget deal.
For some, like Rep. Pam Powers Hannley, the math does not add up:
Groups like NOW, YWCA, and ACLU back the diaper bank bills across the country, but skeptics say they are not looking close enough. Skeptics point to towns like Tucson, the fifth poorest metropolitan area in the country as dependent on sales taxes whether due to rising costs of services or mismanagement. Whatever the case may be, the communities cannot do enough with what they have and one less source of revenue is deadly.
Alison Weir, director of Programs and Policy for the National Diaper Bank Network, testified before the California Assembly’s Committee on Revenue and Taxation: “Currently seven states, Massachusetts, Minnesota, New Jersey, New York, Pennsylvania, Rhode Island and Vermont, exempt diapers from state sales and use tax. These states exclude diapers under a variety of reasons. Massachusetts exempts diapers because diapers are considered medical supplies, and Pennsylvania exempts diapers because diapers fall under a personal hygiene exemption to taxation that includes incontinence products, toilet paper, and feminine hygiene items. Three states, Connecticut, Maryland, and North Dakota exempt adult diapers as medical supplies.”
As Assembly Bill 479 wound its way through California legislature, Dan Walters with the Sacramento Bee called for “serious sales tax reform” that “would close loopholes and reduce rates.” That is something most Arizonans on either side of the aisle could get behind.