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Navajo Nation Considers, Rejects Junk Food Sales Tax

  • Aug 5, 2013 | Gail Cole

 Sinfully sweet.

Taxing sins raises revenue and curbs behavior deemed bad, or at least costly, to society. Alcohol and cigarettes are the most popular targets of sin taxes, but they have recently been joined by fatty foods, sugary drinks, and even lap dancing. "What next?" we find ourselves wondering.

Next: Native Americans consider imposing a sales tax on junk food.

According to the Centers for Disease Control and Prevention (CDC), Native American adults are "2.6 times more likely to have diabetes than non-Hispanic whites of a similar age." Rates are on the rise, especially among youths. Prevention efforts now include school-based programs designed to "increase physical activity, improve diet, and reduce obesity among children."

With prevention in mind, the Navajo Nation recently considered adding a 2% sales tax to junk food. The 2% tax was proposed, said bill sponsor Council Delegate Danny Simpson, "to address the obesity and diabetes problem on the Navajo Nation." Indian Country Today called the Act "a historical piece of legislation regarding food sovereignty of the the Nation." The bill also sought to eliminate the sales tax on fresh fruits and vegetables.

In mid-July, the Junk Food Sales Tax Act was defeated in an 8-10 vote.

There is already a 5% tax on junk food sold throughout the Navajo Nation. Had the Junk Food Sales Tax Act passed, the additional 2% tax would have funded health and wellness programs. The hope was that it would also decrease the amount of junk food consumed by members of the community.

Find another way

Council Delegate Katherine Benally said she prefers to find other ways "to discourage Navajo people from buying unhealthy foods." She doesn't think taxes are the answer. She was joined in her opposition by Council Delegate Mel Begay, who was concerned an additional tax would simply "draw business away from the Navajo Nation."

Good intentions

Many delegates who opposed an increased tax on junk food praised "the overall intent of promoting healthy living." One suggestion? Find inspiration in the federal government's Farm Bill, and get Navajo people growing their own food again.

But good intentions have a way of raising ire. Taxes on soda and violent video games have been fought by the industries that create them. It is therefore perhaps not surprising that both Coca-Cola and Pepsi sent representatives to the Navajo Nation to protest the proposed legislation. Delegates reportedly noted that "this was the first time" those companies had visited the reservation.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.