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Lakewood eliminates grocery tax

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Contributed by: Erin Feese/YourHub.com on 5/13/2008

At the Lakewood City Council meeting May 12, council voted unanimously to eliminate the 2 percent sales tax on grocery food items, while rescinding the temporary sales tax waiver at Colorado Mills and Creekside. The waiver is part of the voter-approved sales tax increase in 2005. Rescinding the waiver helps offset the city revenue lost when eliminating the grocery tax.

The food tax brings in approximately $4 million per year, according to Mayor Bob Murphy. By rescinding the waiver of the 1 percent sales tax at Colorado Mills and Creekside shopping centers, $3 million in additional revenue would be available. When coupled with the repeal of the sales tax on food, the loss of revenue to the city is reduced to $1 million, Murphy said.

The ordinance follows the recommendations of a committee of seven Lakewood citizens formed to research the grocery tax issue by Murphy in November to research the grocery tax issue. The ordinance will take effect Jan. 1, 2009.

After the committee began its work, Lakewood citizens began circulating a petition to remove the grocery food tax. Council's decision potentially saves the city the cost of an election.

"The grassroots petition group is thrilled this regressive tax is gone," said Natalie Menten, grocery tax committee member and one of the petition organizers to eliminate the grocery tax.

According to Menten, Lakewood residents currently pay 2.5 percent sales tax on food for home consumption and 7.6 percent on all other foods. Food that is prepared for you to eat at a fast-food restaurant, such as a sub sandwich, is taxed at 7.6 percent, which the ingredients for a sandwich that you buy at the grocery store --such as bread and meat -- is taxed at 2.5 percent, she said.

The ordinance eliminates 2 percent of the tax; the 0.5 percent Jefferson County tax will remain.

Read more:

Letter from Lakewood citizen David Wiechman
Letter from Lakewood Mayor Bob Murphy
Grocery tax FAQ from Natalie Menten

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