The Missouri House is considering legislation that would lower the sales tax on menstrual products but taxation experts say the measure defeats the purpose and that there are better ways to target low-income women who cannot afford them.
“It would be better to try to accomplish these social policy goals through the spending side, not through the taxation side because the tax response is often so much broader than is necessary,” said Katherine Loughead, a senior policy analyst with the Tax Foundation.
Rep. Rasheen Aldridge (D-St. Louis) sponsored the legislation, which would lower tax on child diapers, adult diapers, tampons, pads, liners, and menstrual cups to 1.225% from 4.225%.
“If states continue to carve out these new exemptions for various things that reduces revenue, and then over time, as sales tax bases have steadily declined with these new exemptions, sales tax rates have repeatedly risen and so even if you benefit from having certain items exempt from the sales tax, you're paying higher sales taxes overall," Loughead told the St. Louis Record.
"You're not better off. Any of these exemptions are really shortsighted and we should really be thinking about what is best from a structural perspective."
Alaska, Delaware, Montana, New Hampshire, and Oregon are among states that do not assess a sales tax on these products while Connecticut, Florida, Illinois, Maryland, Massachusetts, Minnesota, New Jersey, New York, Nevada, and Pennsylvania have exempted essential hygiene products.
The measure could help ease family financial burdens during a time of high inflation, according to media reports, however, Loughead said that in the long run, reducing the sales tax rate only reduces the amount of money the state has to administer social services.
“If you exclude or reduce the sales tax rate on these products for all people, most of that benefit is going to people who can very well afford to buy these products and to pay the sales tax,” she added. “The whole purpose of the tax code and of the sales tax is to generate revenue to fund government services and a lot of government services are meant to address the issue of poverty and to provide public assistance.”