LITTLE ROCK, Ark. (KATV) — Governor Sanders made her case for legislation that would eliminate the state’s tax on groceries.
“For too many families, the grocery bill went up and their paycheck stayed the same. For those families at the bottom of the income ladder, that means missed meals and empty dinner tables.”
Governor Sanders says it’s time to end what she calls “the state’s most regressive tax”.
The ‘Grocery Tax Relief Act’ would repeal the state’s 0.125% on food. She says, if passed, the legislation would save Arkansas families save an estimated $10.9 million annually. The proposal does not include county and municipal grocery taxes.
State Representative Kendon Underwood, who’s co-sponsoring the legislation, says it is designed to help Arkansans who are struggling with high food prices.
“They spend more at the store but they’re getting less. Now, this bill may not be a silver bullet, it may not solve all the problems but what it does say is that ‘we hear you , we understand the challenges that you’re facing, and were here to address the issues.”
Easing the tax burden on families at the grocery store has been a goal of Arkansas policy makers for years.
This tax, a part of Amendment 75, was designed to fund state conservation efforts, but now, after years of gradual cuts, Governor Sanders says the time has come to do away with the last remnants of it.
“With the state tax, it’s such a small portion. I’m not sure if it’s going to make that big of a difference as far as making purchasing decisions. What I really hope you’ll see is maybe this is a good example for local municipalities, counties, and cities to go in and maybe reevaluate their grocery taxes as well,” Steve Edwards, project manager at Edwards Food Giant.
Steve Edwards from Edwards Food Giant says his customers debate the price of groceries every day, as they support families on a tight budget, and that this move is a step in the right direction.
According to a 2024 U.S. Department of Agriculture report, Arkansas has earned the distinction of being one of the nation’s leaders in food insecurity. With a staggering 18.9% rate of food insecurity over a three-year span, it ranked as the highest in the country, highlighting a severe challenge for many residents.
“People of Arkansas are having a hard time at the grocery store. Whether it’s $.10 or $100 every time they go it matters. I’ve never found somebody that’s shopping that says I wish I would’ve paid $.10 more at the grocery store today,” says Senator Bart Hester.
Governor Sanders framed this legislation as essential in light of rising food prices, blaming the Biden Administration’s policies for the cost spike.
She says ending our state’s most regressive tax will help families who are just trying to put food on the table.
This change won’t affect local grocery taxes, which will remain in place.
“You’re still going to be paying taxes at the grocery store, but that’s gonna be your local, your city, and your county taxes. If you want to eliminate those, I say go talk to your mayor and your county judges. But, the state is eliminating all that we’re charging,” says Hester.
Governor Sanders stated that the agencies involved who receive funds from the grocery tax have healthy budgets, assuring that the state’s financial foundation remains strong.
If the legislation is passed, it will take effect on January 1st, 2026.
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