Rethinking the Sales Tax Food Exclusion With SNAP Benefits

Food is taxed differently by states and local municipalities depending on where the food is intended to be prepared and consumed. Food purchased to be prepared at home is considered food at home, or non-prepared foods that would typically be purchased at a grocery store. Most states either totally or partially exclude food at home from the general sales tax. That exclusion generates a debate between tax policy analysts with their emphasis on broad-based, low-rate tax systems, and advocates for the poor who argue that the exemption for food is necessary on distributional grounds. States that do tax food at home are often singled out as having particularly regressive and punitive tax systems.