HR0029 101ST GENERAL ASSEMBLY

HR0029 LRB101 04014 ALS 49022 r

HOUSE RESOLUTION

WHEREAS, Families have already suffered catastrophic damages as a result of the budget impasse and, according to the Pew Center, a food and drug tax is the most regressive tax that punishes citizens on a fixed income; and

WHEREAS, In 2015, there were a total of 160,569,757 retail prescription drugs filled at pharmacies in Illinois; and

WHEREAS, Prescription drug prices increased 12.6% in 2014, outpacing inflation; increasing taxes for prescription drugs will create more of a financial strain for Illinois residents, especially since 8.8% of Illinois senior citizens live in poverty; and

WHEREAS, According to the Consumer Healthcare Products Association, over-the-counter (OTC) medicines are a reliable and affordable way of maintaining wellness for millions of American families; and

WHEREAS, OTC medicines not only treat the symptoms of common ailments but also help prevent a number of costly chronic conditions through products like smoking cessation programs; and

WHEREAS, The average American household spends approximately $185 on non-prescribed OTC medicines per year while the average senior citizen spends $356 yearly; and

WHEREAS, Many states have already acknowledged the therapeutic value and cost-effectiveness of OTC medicines and allow a retail sales tax exemption for the purchase of these products; Florida, Maryland, Minnesota, New Jersey, New York, Pennsylvania, Rhode Island, Texas, Virginia, and the District of Columbia do not levy sales taxes on OTC medicines; and

WHEREAS, The 2012 Value of OTC Medicine to the United States report found that OTC medicines offer $102 billion in annual savings relative to available alternatives; and

WHEREAS, The Consumer Healthcare Products Association advocates for policies that support access to OTC medicines by exempting them from sales tax; and

WHEREAS, Food security is an issue that places an enormous burden on struggling families within Illinois; and

WHEREAS, According to the Illinois Commission to End Hunger, almost 1.7 million Illinois residents still face food insecurity, a number greater than the entire populations of Hawaii, Montana, and 10 other states; and

WHEREAS, According to the Illinois Commission to End Hunger, more than 449,000 low-income Illinois children participate in the National School Lunch Program but do not receive school breakfast; it is increasingly vital that food in the State be at a reasonable price; and

WHEREAS, The lowest-income Americans spent an average of $3,667 on food in 2014, which amounts to 31.4% of their income according to the United States Department of Agriculture; and

WHEREAS, For a family of four living on $2,000 a month, to spend 34% of their income on food would equate to $8,160 a year; and

WHEREAS, The states with the highest taxes on food, Mississippi, Arkansas, and Alabama, had the highest rate of food insecurity in 2014; and

WHEREAS, Illinois may also lose tax revenue to bordering states; if Illinois increases taxes on food and drug, residents may drive to Indiana, Iowa, Missouri, and Kentucky to purchase those goods, causing additional harm to our economy; and

WHEREAS, According to U.S. News and World Report, taxing groceries and prescription drugs shifts the state's focus on the real issues, which should be alleviating the barriers for quality food and necessary medications for low-income citizens; and

WHEREAS, In Illinois, the bottom 20% have an average income of $10,900 yet pay 13.2% of their income to taxes; Illinois is currently ranked third for the highest taxes on the poor according to the Institution of Taxation and Economic Policy; and

WHEREAS, A tax on food and prescription drugs is fiscally damaging to middle-class families because their average income is $49,500 yet 10.8% goes toward taxes; and

WHEREAS, Expanding taxes on food and drugs disproportionately hurts lower-income families, further resulting in a higher rate of food insecurity; and

WHEREAS, Senior citizens and children are most affected by food insecurity and drug prices; therefore, be it

RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE ONE HUNDRED FIRST GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that we believe that sales taxes on food and drugs should not be increased.