The former Chief of Staff to Tulsa Mayor Dewey Bartlett says he wasn’t suggesting that food stamp purchases should be subject to state and local sales taxes, he just wanted confirmation of a rumor he’d heard that those purchases were not taxed.  Terry Simonson brought up the issue today at a meeting of the Task Force on Municipal Sales Tax Collection at the State Capitol.  Simonson was appointed to the task force by House Speaker Kris Steele.

Speaking with Oklahoma Watchdog Editor Peter J. Rudy (listen to the complete interview here), Simonson said he’d “heard that people who purchase groceries and other items with food stamps don’t pay sales tax and, of course, the rest of us do.”  Oklahoma Tax Commission staff told Simonson at the meeting that federal law prohibits sales tax from being charged on food stamp purchases.

When asked if he thought food stamp purchases should be taxed, Simonson said, “I don’t have any other thoughts at this point other than to kind of, in my own mind, ‘is that okay? is that fine?’ People on food stamps obviously are on limited income. That’s why they have food stamps. So maybe they shouldn’t have to pay sales tax. Or should they? I really don’t have any opinion because this has just come to my attention.”  He went on to say that it had never occurred to him that someone on food stamps wasn’t paying sales tax.

The task force was created to deal with the issue of cities, Tulsa specifically, wanting to contract with outside vendors to collect and remit sales taxes levied by the city.  State law was recently changed requiring cities to contract with the Oklahoma Tax Commission for those services, but many cities feel OTC isn’t doing the best job it could and they are losing out on dollars owed to them.  Plans are being drawn up to allow cities to contract with individuals or companies to increase enforcement provided it is done through OTC.

Simonson also proposes having the businesses pay an administration fee that would pay for sales tax enforcement.  He says a $10 per month fee on every sales tax license in Tulsa would raise about $2.4-million which is roughly the amount the city pays OTC for sales tax collection.  OTC keeps 1% of the money it collects on behalf of cities and counties.  Simonson says since businesses are the ones getting the services from OTC, they should be paying for it, just like the state’s courts are funded largely by fees on every court case.

Task force members also heard from the Oklahoma Tax Commission about bills working their way through Congress that would allow states like Oklahoma which are members of the Streamlined Sales Tax Agreement to collect taxes on items purchased online.  One, written by Wyoming Republican Senator Mike Enzi, seems to be getting a lot of bipartisan support according to OTC officials.

Today’s meeting was the last one for the Task Force.  Members will not be voting on recommendations to lawmakers but will instead issue a report that includes ideas from all of the members.

You can read edited notes taken during the task force meeting by clicking here.