H.B. 231 Restaurant Tax Repeal Amendments

What this bill does

The bill would end the 1% statewide tax on prepared restaurant food and replace it with a roughly 0.1% sales tax on most purchases, except grocery food. Under the latest version, counties would keep receiving at least as much revenue, could keep paying off bonds backed by the restaurant tax, and could keep spending the money on the same programs.

Plain-English summary written by AI from the sponsor’s presentation in committee and on the floor. Check the official text below.

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Every vote

• 6 yes, 1 no, 4 absentHouse Judiciary Committee: vote to change the bill · Mar 2, 2026Who voted how
• 5 yes, 3 no, 3 absentHouse Judiciary Committee: vote to approve it · Mar 2, 2026Who voted how
• 21 yes, 52 no, 2 absentHouse vote, which failed · Mar 3, 2026Who voted how

Hearings and debates

• Mar 2, 2026 House Judiciary Committee▶ Watch
  Transcript (51 turns)

  1. Committee chair36:58

     So we'll go ahead and, and go to first substitute house Bill 2 31 Restaurant tax repeal amendments from Representative Thurston. Good morning Representative Thurston, the time is yours.

  2. Rep. Norman K Thurston37:09

     Thank you, Mr. Chair. Oh, wow. Gotta get that way closer. Uh, I'm going to, I've prepared my remarks very carefully to the current sub, but I will also point out that there is a second sub, which I would not oppose, but I think the points still here are helpful. So, Mr. Chair, members of the committee, this represents an opportunity to statewide repeal of the 1% surcharge on prepared food that is sold as ready to eat, commonly referred to as the restaurant tax. Although, as you will see, that's a really a bit of a misnomer. But before we want I get into that, I want to talk about how we got here. So over the summer and in October, we worked in good faith with the county representatives and we had reached what I thought was a consensus on a broaden the base, lower the rate approach. This is a textbook economic solution. When you lower the rate and apply it more broadly, you would actually have generated total revenue increased by 7%, also tied to a much more stable source of revenue. So you'd think that is a good thing for everyone involved because it generates more money from a more predictable source. But, um, since then the counties and the tourism lobby walked away from the deal. Now why would anybody walk away from more money and more stability? Well, in the world of special interest, it's not always about the money. It's sometimes about control. Apparently these people want a system that allows them to appoint to a specific group of people and say, that's our bucket. By rejecting a higher yield, more stable source of revenue, it has become apparent that this isn't about meeting the county's needs by providing adequate revenue. It's really about protecting status and control of certain special interests. So the counties not being interested in better affairs system. I proposed that we do what's best for taxpayers in those counties. We hear a great deal about how this type of attacks is wonderful. It's a way to get, quote unquote, those other people, the out of towners to pay for our amenities. It's a seductive idea, isn't it? The idea that we can have a free lunch at someone else's expense. But the reality is that over 80% of this tax is paid by our own constituents, right here in Utah. It is a local tax with a misleading label. And who is it hitting? Let's talk about who's paying the tax. In recent years, we've seen this tax move. Uh, so this tax has been around for a dec couple of several decades, and we've seen it move from the high end steakhouse, which is what people think of as the restaurant tax. But now you pay it at the grocery store Deli counter. We are now taxing quick order services that the busy Utah family relies on just to get through a Tuesday. When a mother short on time, but long on responsibility, picks up a couple of pizzas from Little Caesars or a Made to order chicken tenders meal at the grocery store de Deli to feed her kids between work and soccer practice. The government is right there to tap her on the shoulder and say, that will be an extra 1%. Please. Why? To take money away from that family's dinner table and hand it over to a county bureaucrat to subsidize specific industries and pet projects. It's an inverted subsidy. We are taxing the small to prop up the large and it creates the ultimate economic hazard under Milton Friedman's framework. This is the fourth class, spending someone else's money on someone else. And make no mistake, 1% matters in economics. Everything happens at the margin to a bureaucrat. 1% is a rounding error. But to an event planner like me, I do that for my, for my day job. Deciding whether to bring a multimillion dollar convention to Salt Lake City or to take it to Denver or Miami. That 1% surcharge is a price wedge. It's a keep out sign. And when that business doesn't come, we don't just lose the 1%, we lose the entire economic economic activity. But as Baat said, there's a difference between the seen and the unseen. We see the tax, we see the revenue we generate, but we don't see the business that we don't, that doesn't come to our state. Finally, and this is the most important part of all, we've created a monster of complexity. We have to remember that a tax isn't just paid at the receipt, it's also the cost that's required to collect it. I've heard it said in many occasions that this is the most burdensome stacks in the state of Utah to administer. Why? Because we've turned every grocery store, every cafe, every sandwich shop into an unpaid branch of the tax commission. We're forcing them to hire accountants, software specialists and so on to categorize every single item they sell into the proper bucket. Is the fried chicken hot? Are utensils provided? Well, what if that same chicken is cold? And in the refrigerated case, what about a grab and go sandwich? But if that same sandwich is a custom made sandwich with no pickles, does that change the tax rate? Those shop owners have to think about that on every single item they sell. All of the administrative complexity and questioning represents an economic dead weight loss. When a manager is in the back room wrestling with tax categories instead of on the floor serving customers, the economy is made poorer. And then of course the tax commission has to hire its own people to answer questions and to oversee the grocery store's own bureaucrats to make sure the chicken or the sandwich is categorized correctly. If we repeal this tax, or in the case of the second sub, if we move it to a less complicated type of attacks, the money doesn't disappear. It stays in the pockets of the people who earned it. They will spend it on local businesses, they will buy shoes, they'll buy car repairs. And heaven forbid, they actually might spend even more on restaurants because the prices are lower. The only real way to grow an economy is this, to keep the money in the pockets of those who have earned it. Much of the spending will still, of course, be safe subject to local sales taxes and there will still be revenue for the counties to address important needs. But you can't make a community richer by taking money out of one pocket, hiring a group of people to move it around and dropping a smaller amount back into the other pocket. You make it richer by leaving people free to choose how to spend their own earnings. So House Bill 2 31 is a small but vital step towards sanity in our tax system. It's time we stop taxing the local family's lunch to pay for industry brochures. And also it's time for us to have a simple tax code that people can actually understand and administer, especially small businesses and their employees. And with that, I would be happy to take any questions.

  3. Committee chair43:30

     Thank you, Representative Thurston.

  4. Unknown speaker43:31speaker not certain

     Just a a clarification question. I see there's a house amendment one to the first substitute, which has already been adopted, and then I also see a second substitute.

  5. Rep. Norman K Thurston43:40

     Yes. So will you Speak to that later or I'll I'll go ahead and speak to that now that's that's a great question, Mr. Chair. So, uh, so in the world of worlds, I would repeal the tax and give the people of Utah a $95 million tax cut. That's, that would be my ideal in that, in that case, we'd need to adopt a amendment. But I understand that that causes a lot of heartburn, a lot of anxiety because that money is being spent on projects and programs that are out there. And those people might not like that. So the second sub sets us back to essentially the, the deal that I thought I had negotiated in October. It guarantees that every county gets at at least the same. Well actually it guarantees that every county gets more revenue than they're currently getting. It ties it to a more stable source of revenue. So economic economy proof. And it also, uh, does it all without the counties having to get together and take a vote. So it happens automatically. And those were the, the, the key sticking points or the key requests from the counties when we met in October was to give them those three gives. Every county gets more money, it's a better revenue source because it's more stable and the counties don't have to do anything. So, uh, I would leave it up to the committee. I mean, if, if you all just want to give everybody a tax cut, that's great. I would love that. But I understand the political realities that we're in and you've probably been contacted from your own county representatives. Um, and so with that circumstance, I think the second sub represents a very good alternative. There's actually, in many ways better for counties. Uh, and certainly it's better for small businesses because it's less complicated. There's no having to figure out sandwiches and fried chicken and all that stuff. It's just, it just applied on everything else that you're already collecting tax on.

  6. Committee chair45:15

     Got it. Thank you Representative Thurston. We'll go to representative er.

  7. Rep. Stephanie Gricius45:19

     Thank you Mr. Chair. And, uh, oh, sorry, I don't know if this is working. Can you, oh, you want this? I mean it's on, but Oh, the other one? Yeah, there we go. Okay, that's better. Um, thanks for presenting this. I've gotten a lot of feedback from the counties that I represent that many of them have already bonded against the tax that they were expecting to get from the restaurant tax we passed last year. Can you speak to how that would be affected by this?

  8. Rep. Norman K Thurston45:46

     Absolutely. So the, the first sub, which is the one before you has a, a hold harmless provision on bonding that they can continue to ta to receive the tax and collect the tax to pay off existing bonds. The second substitute basically has, has unlimited, they can con they can pay off their current bonds and they can actually issue new bonds in the second substitute, as I'm glad you mentioned that. So yes, uh, in, in the current version, there is a provision that allows them to pay off their bonds. And in the second substitute that is a fourth provision, which is that they can continue to bond against this revenue. We did not pull back on their, their ability bonds since they have more revenue. Presumably that should work just fine.

  9. Rep. Stephanie Gricius46:24

     Okay. Thank you very much.

  10. Committee chair46:26

      Thank you representative. We'll now go to Representative Loubet for clarifying questions.

  11. Rep. Anthony E. Loubet46:30

      Thank you Mr. Chair. Uh, you mentioned in the second sub it's a different funding source, um, that's more reliable, uh, compared to the restaurant tax. Can you go into detail what funding source you're talking about?

  12. Rep. Norman K Thurston46:43

      Absolutely. So the restaurant tax is a 1.0% tax on prepared food that is made to order. The proposed alternative funding source would allow this to be a revenue neutral or slightly enhanced revenue from the general sales tax, which tax pretty much everything except for grocery store food. So a, a can of beans at the supermarket would be that kind of thing would be the only thing that's exempted from that sales tax. And when you do that, broaden the base, lower the rate. First of all, nobody has to reprogram 'cause that's already in their system, second of all. So that, that decreases the complexity. But that on average would be about 0.1%. So it's a 10th of the tax rate. And so it's such a small increment in the tax that the economic distortions are also minimal as well.

  13. Rep. Anthony E. Loubet47:28

      Okay. So it's just removing, it's just increasing the sales tax broad broadly across like by a little bit to cover that difference, Right? Yeah. So, so

  14. Rep. Norman K Thurston47:37

      you're taxing, instead of taxing restaurant food, you're taxing everything. You're taxing automobiles, you're taxing like new end used cars, you're taxing shoes, you're taxing clothing, you're taxing, uh, everything that pays a sales tax would be taxed at that much, much smaller rate.

  15. Rep. Anthony E. Loubet47:51

      Okay. Thank you Mr. Chair.

  16. Committee chair47:53

      Thank you Representative Loubet. We will go to representative gracious.

  17. Rep. Stephanie Gricius47:57

      Thank you Mr. Chair, do you have data or information on how much of that restaurant tax is paid by residents currently versus visitors?

  18. Rep. Norman K Thurston48:04

      Yes. So there was a study done by the Kimsey Gardner Institute, um, non-resident travelers pay only 19% of the restaurant tax 80, 81% tax. Uh, that was, and that's with old data. Um, beginning January 1st, 2026, that rate has been applied to new products, which are presumed to be largely resident based. So when you go to Macy's and buy an ice cream cone that's now taxed, it didn't used to be taxed. If you go to this, the there and there are other examples of that. So the prepared food within grocery stores, that tax rate got raised on them too. So, um, I I I think I'll just be feel comfortable saying at least 81% of the restaurant tax is paid by Utahans. And that was from that Kem Mc Gardner study. Kem Mc Gardner study. And, uh, maybe I just add one more thing to that. So tax commission is showing that, uh, this issue of the busy families, um, household budgets are shifting from, uh, food that you have to cook to food that you don't have to cook. So it is an increasing part of family budgets. It's not just a made up thing that busy mo busy moms isn't a made up thing. We all know that it's a real thing, but the data is actually starting to show that they are relying more and more on these prepared made to order foods as that's just a way of feeling their family.

  19. Committee chair49:14

      Thank you. Thank you so much. Representative Gricius. Seeing no further lights, we'll go to the public comment portion of this meeting. Is there anyone in the public who would like to speak to this bill in the room? 1, 2, 3. Just three in the room. And then do we have anyone online? Two online and two online. Excellent. 5, 5, 6 Online. Do we have seven? We have. We have seven. Alright. Um, just, uh, by way of information when you come up, if you can just introduce yourself and if you have, uh, if you're representing an organization and, um, the time is yours. Thank you, Mr. Davis.

  20. Dave Davis, Utah Food Industry Association49:53

      Thank you, Mr. Chair. Dave Davis, president of the Utah Food Industry Association in Utah, retail merchants. We represent grocery stores, convenience stores, that segment of the business out there. And let me just speak very quickly and give you a couple of examples about the complexity that the current restaurant techs places on the members that, uh, I represent. Um, if you were to go into a maverick, which I am sure that you've all been in before, and you were to grab a slice of pizza from under the heat lamp that would be taxed as prepared food and not subject to the restaurant tax. If I walked up to the counter and said, I would like this same pizza, a pepperoni pizza, uh, and, um, had them make it for me, it would then be subject to the restaurant tax. It was quite interesting as we worked with Representative Thurston on this and he wanted to make sure that his comments were fair and accurate. We had to go through multiple iterations to try to figure out how to give examples of what is taxed by the restaurant tax and what isn't. And quite frankly, many of my members are struggling with this mightily, you go into a grocery store if you order an ice cream cone. Is that made to order? I think so. Maybe yes, maybe not. Uh, what if you decide to have some sprinkles put on that? Does it become made to order at that point? So we would urge you to support the bill. This is an, um, an item that would bring great, uh, relief as far as the complexity issue. And remember in the tax code, there are numerous times that we trade being absolutely precise with efficiency. We give up collecting things Exactly, because it just doesn't make any financial sense to go after those last few pennies. They're too expensive to get. So we would urge your support and I'm happy to respond to any questions.

  21. Committee chair52:14

      Thank you, Mr. Davis. I'm not seeing any questions, although I might have to declare a conflict of interest based on my consumption of con con cones at Macy's. So just putting that on the record.

  22. Melva Sine, Utah Restaurant Association52:34

      Good morning. Thank you, Mr. Chair, co-chair and members of the committee. My name is Melva Sign and I am the president of the Utah Restaurant Association in the state of Utah. Um, this, uh, restaurant tax was enacted in 1992 and has been in existence since that time last year. Senate Bill 91 made it so that grocery stores who operated many of their food products as restaurants do would then be taxed at the same rate that restaurant food is taxed at, which made it, uh, mark made the food marketplace more equal in terms of what we charge and what they charge. 'cause in 1992, there were not that many restaurants try or that many grocery stores trying to be restaurants. But since we've evolved over the last 30 something years, we now see, um, grocery stores who are entering the restaurant marketplace and, and with their prepared foods and other things, and actually selling many of the same products that you will find. An example is if you go to Cha Orama Chara has a buffet and you go in and choose whatever you want and you collect the 1% extra tax on it. If you go to a buffet in a grocery store, that is basically the same thing. You don't pay 1% tax on that food. So what we did last year was create a fair and equitable tax in the food marketplace. Um, we as the restaurant industry, fought for years to eliminate the restaurant tax. Um, and in your statute it says that local government bonding act, you can finance these types of things through the restaurant tax, an airport facility, a convention facility, a cultural facility, a recreation facility, and a tourist facility. I'm not exactly sure what a tourist facility is, but all of these other things are items that should be paid for by lowering the rate of the restaurant tax and making it so that everyone pays. We all use the Salt Palace, we all use the airport. Why are just people who are eating in restaurants paying for those facilities, or now choose to eat food, uh, that is prepared from a grocery store. So we have long supported a way to keep the counties whole, and that is our intent. Um, I serve on the Governor's Office of Tourism Board. Thank you. And we see value there.

  23. Committee chair54:55

      Thank you so much. Yes, ma'am. Thank you. Maybe we can vacate both of the chairs just so we can expedite the process here if that's possible. Yeah.

  24. Billy Hesterman, Utah Taxpayers Association55:15

      Thank you Mr. Chair and our, uh, Madam Chair and Mr. Vice Chair and committee for the time this morning. Billy Hesterman with the Utah Taxpayers Association. Uh, a conversation we had about this bill last week, uh, shows just exactly why we, we, uh, are supportive of the, the legislation as we were emailing back and forth about, uh, this tax and the different ways it impacts, uh, the different products that are within a a grocery store even, uh, we found that it was just complex then to even figure out, well, which gets the 1% and which doesn't, and which should be taxed at this rate and which should be taxed at that rate. And so beyond the complexities for a, a, uh, grocery store or a restaurant or, or, or a, uh, convenience store that might have a restaurant within it, uh, it's also complex for the taxpayer to understand where, what tax is being applied to them. And so if we're finding ways that we're able to make it easier for the taxpayer to know what the rate is they're paying and understand how much it's going to cost them before they go to the purchase, we appreciate that effort. And so for that reason, we ask you move the bill forward.

  25. Committee chair56:20

      Thank you so much. Welcome. Thank you.

  26. Brandy Grace, Utah Association of Counties56:25

      Good morning. Brandy Grace with the Utah Association of Counties. Um, a couple of points that I would just like to address that Representative Thurston made. Uh, it is true. We met in October. At that time, I expressed to him that at a minimum concerns that the counties would have would be, uh, being made wholly funded. As was pointed out, there are some of our counties who have bonded against this revenue has been around for a very long time. It's a revenue source that they rely on. Um, other concerns included implementation and how that would work. Um, and then we continue to have conversations internally within Utah, Utah Association of Counties. In November County Commissioners met, we talked to them about this concept. They then took it to, um, staff at, at their counties, including their tourism directors and others. Um, while it has been, uh, indicated that statewide, this is actually a tax that's born by local residents, um, that's statewide though we have some areas of our state that more significantly would be shifting this burden onto local residents within their own communities. Um, I'll use the example of Washington County. I think we may even have a representative from Washington County that may testify online, but you'll hear from some of them about the shift to local residents. And while it might be true that tourists pick up a bigger portion of this, local residents pick up a bigger portion, or local residents pick up a bigger portion of the restaurant tax, it is also true, they pick up a bigger portion of general cells in use tax. So they would be picking up a bigger piece of this. And so we, we have revisited this multiple times and just have not been able to get to a place that we don't see this as a shift to local residents. So with that, the Association of Counties, um, opposes this bill. Thank you.

  27. Committee chair58:11

      Thank you. Is that, is that everyone in person? Okay. We'll start going to online. We'll go to, uh, first, uh, Mr. Adam Snow,

  28. Adam Snow, Washington County Commissioner58:38

      Thank you chair, uh, Adam Snow County Commissioner in Washington County, and, uh, vice president of uac. Uh, very quickly, the 1% deterrence might be true in some areas, but it's, it's not true in tourism dependent counties. With all due respect, this isn't moving money from one citizen pocket to another citizen pocket. It's taking money that is being spent in significant part by tourists and benefiting Utah citizens. In 2024, in Washington County alone, visitors spent $174 million in restaurants and only 3.2% of their spending in, in retail. That's a six to one ratio almost of spending in restaurants to general retail, non-restaurant sales tax. Uh, these funds are restricted under this proposal, proposal by TRCC statute and how they can be spent. Right now it's the almost 10 million annual visitors in Washington County alone helping pay for that. And under statute, they're the primary beneficiaries of those funds. But my citizens get some benefit as well. We have bonded against our airport, our convention center, other things that people use, uh, under this proposal, the restrictions are still in place for the benefit of the tourists. But now my citizens get to pay the majority of the tax. I cannot go to my citizens who already feel the burden of tourism when almost, uh, every fifth person see on the street is a tourist and say that they now get to subsidize tourism rather than tourist subsidizing Utah citizens. So for that, we ask that you oppose this bill. Thank you.

  29. Committee chair1:00:00

      Thank you, commissioner. We'll now go to Selena Sinclair. So Thank you. The time is yours.

  30. Celina Sinclair, resident1:00:26

      Thank you. Thank you Committee and Madam Chair, Mr. Vice Chair. I appreciate the opportunity to be able to join virtually and speak to this issue. Um, as an industry we are seeking, um, to respectfully ask that you oppose HB 2 31. The reason being that for us, the restaurant tax, um, which generated as Representative Thurston acknowledged around 95 million statewide last year, provides counties with a dedicated resident benefited funding stream for arts, recreation, culture, tourism, promotion, and in some cases airports and community infrastructure. I wanna thank our county representatives for addressing some of the comments regarding the resident versus visitor nuances that occur in each county across the state in regards to who is generating the tax. I also wanna address Representative Thurston's comments regarding the group travel business. Last year, through our work with Representative Bollinger, we saw a 1% increase to our lodging tax stack in regards to our group business mechan mechanisms on where they're looking at the overall tax stack. A general sales tax increase would then further increase that lodging tax rate, um, which is where we really see in regards to competitiveness and how our, some of our key destinations in Utah are rising to the top of that stack competitively. So, um, while this is not a uniquely tourism issue, we wanna ensure that visitors are pairing their fair share when they dine out in community because for lack of a better term, dining out is quite inevitable when you are a traveler, um, in, in those destinations. So with that, we'd ask for you to respectfully, um, oppose HB 2 31. Thank you.

  31. Committee chair1:02:04

      Thank you Ms. Sinclair. Now go to Jocelyn Gutter.

  32. Joselyn Scudder, resident1:02:22

      Hello, good morning. Thank you for your time. My name is Jocelyn Scutter. I am a Summit County resident and I also run our local nonprofit arts council. And I'm here to ask for your support in opposing HB 2 31 and maintaining the restaurant tax as it currently exists in statute, the restaurant tax is a really effective funding mechanism and a tool that allows communities to invest in programs that residents value. It allows communities to support programs that strengthen our quality of life as residents without raising broader taxes. Um, I'm gonna use some hyper, uh, local examples just 'cause that's what I can speak to. Our organization is a beneficiary of the restaurant tax grant and our grant funding supports local jobs and small businesses. If that goes away, for example, we will likely have to eliminate three part-time contract positions, um, allowable, um, uh, within the funding restrictions. Um, but it's funded by the restaurant, uh, tax grant. And, um, it's laying off residents who really rely on this employment to support their livelihood. Um, it will also reduce our programs and economic activity in our community. Um, and while I hesitated potentially to cite such, such a specific, and maybe example, I mention it because we're a fairly small, you know, independent, we have eight employees. Um, and so I can only imagine if this, if this funding mechanism, um, many creative industry jobs will be lost, which is, um, bad for the local economy and bad for business. We use this funding also to support, support really like grassroots, uh, community programs. The Summit Arts market in Oakley supports farmers and artists and vendors. They make thousands of dollars at this event and that would potentially go away. Repealing restaurant tax takes away commun, uh, tool that community relies on. So I respectfully ask you to oppose this bill and allow communities to keep this really important tool. Thank you so much for your time.

  33. Committee chair1:04:17

      Thank you Ms. Gutter. We'll now go to Katherine Wang.

  34. Katharine Wang, Park City Film1:04:35

      Hello. Thank you for your time. Um, my name's Katherine Wang. I'm the executive director of Park City Film. We're a nonprofit arts organization that has made world class independent cinema available to Summit County Community for the past 31 years. Um, the programs of Park City Film support a vibrant and accessible arts community in Summit County and use film as a way to enhance the dialogue our community, um, and bring tourists to our town. Like many arts organizations, we've been extremely fortunate to have received support from the Summit County Restaurant Tax for decades. Um, the funds that we receive under the restaurant tax are mainly used for out of county advertising, enticing people from as far away as New York and California to come watch an independent film when they're on vacation in Park City and as close by as Salt Lake City, Ogden, and Heber to make the drive to see a film that no one else is showing. For unique film screening, we've seen as, as much as 70% of our audience come from outside of Summit County. And during COVID, the restaurant tax, uh, grant funding that we received were essential to bring people into our community to help bring revive our economy up here in Summit County. Um, it was absolutely, you know, critical to our, um, ability to be successful, to our ability to survive as an arts organization and to help spread that wealth community into local businesses. Um, we've also used funding to help update the auditorium, which is located in the Park City Library building, which is owned by Park City Municipal Court. The auditorium are used not just by Park City Film, but by large events such as assigned festival and for local community events. Thank you. From city council meetings to book clubs is very important and critical part of our community. Thank you. Um, you urge the repeal, um, to oppose the repeal of the restaurant tax and help support a vibrant arts community up here in Summit County and across the state. It's critical not only to the thank you so much, um, but also to the success of our thank you. Thank you.

  35. Committee chair1:06:29

      Thank you. Now go to Molly Halterman. We have, uh, we have Molly Halterman and then Wendy Hassan.

  36. Mollie Halterman, Mayor of Parowan1:06:50

      Can you hear me? At least I don't see my screen, but can you hear me? Wait, I think I see my video. Okay. I'm just gonna speak very plainly about this. Um, I've done quite a bit of research and appreciate representative Thurston's presentation, but as local residents, um, I know I was elected and told that we need to build what we need first and this TRCC tax helps us build the things our residents need. Um, I'm a mother of 10 and I'm also a mayor. I'm mayor of Paradise in Utah. And I can tell you that the amenities that this tax builds are amenities that our residents really appreciate. When we talk about the TRCC tax, they appreciate it. And most of this discussion that I've been hearing is really just confusion with how it's collected, not the benefit of the tax. So it's one of the few tools that rural counties have to capture a portion of visitors spending at restaurants and reinvest into public facilities and long-term infrastructure. Um, just to give you an idea, in that same report that Representative Thurston quote, um, referenced, um, the county actually collects, um, a significant amount of money. So $39 million in this, with 22 million being from the restaurant tax component. So that means that well over half of that funding comes directly from the restaurant tax, and that is critical for this infrastructure that we're building for our local residents and tourists. And so I just want you to understand that this significant cut would not, um, only affect tourism. It would affect our local residents because there's really no other vehicle to build these amenities that our locals appreciate. And when we grab that fast food as a family, it's because we're going out to those amenities and those adventures that this tax allows us to create.

  37. Committee chair1:08:31

      Thank, thank you so much, mayor. Appreciate it. And we'll, we'll conclude with Wendy Hassan.

  38. Wendi Hassan, Cache Valley Center for the Arts1:08:56

      Thank you Madam Chair. Thank you Committee. I really appreciate the opportunity to testify locally. My name is Wendy Hassan. I am the director of the Cache Valley Center for the Arts in Logan, Utah. I am also one of those busy moms and I have patronized my share of restaurants. The tie between restaurants and theaters is so pronounced that many of our neighboring restaurants have checked our calendar and checked with us because we, many of our patrons visit restaurants before and after the theater. Um, the Ellen Ecol Theater was the remodel in 1989 to 1993, was supported by a restaurant tax bond before I worked here. When I was a mom of busy children, I benefited from the access to these, I mean, you call them amenities, but let's be honest here, it's an economic driver. And what good business would not invest 1% in an economic driver that would benefit the entire community. Each year, our venue generates nearly $2 million in ticket sales, art sales and registration revenue to local artists. And this is paid for by restaurant tax funds that then help us to generate tourists who help pay for those activities, but also benefit the restaurants. And it has been an incredible vehicle and it would, it, it would really be difficult for us to then take that tool from local governments who are the best folks to spend those dollars. They're the closest to the issues. And for a rural community like us, it's really important that those who visit us both in states and out of state thank you, contribute to what we're able to bring here and to create businesses and places that can attract and retain a qualified workforce.

  39. Committee chair1:10:35

      Thank you so much for your time. Thank You so much. We'll now come back to the committee for action. Representative gracious.

  40. Rep. Stephanie Gricius1:10:42

      Thank you Mr. Chair. I was wondering if I can reserve the right to make a motion and ask the sponsor a question. That's an order. Thank you. Um, can you please tell me more about the, uh, the data and the shift and then also that you marking that was brought up during public comment?

  41. Rep. Norman K Thurston1:10:57

      Yeah, I'd be happy to do that. I think one of the public comment mentioned the, the, the fear of shifting from out of towners to locals. Um, so we collected data on that's also, you can figure it out from the Kemsey Gardner report. The maximum amount of the shift would probably be a couple of dollars per person per year. So think about that. We're talking about maybe a dollar, $2, two 50 per person per year is the, is the size of the shift. But what that ignores is the benefit to your local small businesses to the benefit to those business owners and their employees who are also being, again, it goes back to the scene versus the unseen. That's what scene, what's not seen is the benefit to the, the, the local businesses. And I think to your second question about the earmarking, I just heard the mayor say, we spend this money on amenities our residents really appreciate. Now I understand it's a beguiling thought to think that you could get amenities that our residents really appreciate and somebody else could pay for it. That is a beguiling thought, but that's not really what's happening. The residents are really paying for res amenities that residents really appreciate. So the size of that shift is minimal. Um, so, uh, I think that's, that's the key thing to understand about the shift is that it's tiny. It ignores the benefit to small businesses, which is also a, a positive shift. It's a shift away from something that's, that's negative. And even if those things are the case, paying an extra dollar to $2 a year for amenities that are community really appreciates because the funding's not going. If you adopt a second sub, the funding's really not going away. It's still there. The arts, the theater, all of those things, everybody that spoke well, we're worried about our funding going away in the second sub. All of that is taken care of. Does that answer your question?

  42. Rep. Stephanie Gricius1:12:42

      It does. Thank you. And if I can make that motion, Mr. Chair, I'd move that we adopt second substitute

  43. Committee chair1:12:48

      Motions in order. Would you like to speak to it? I think the sponsor already did, Uh, to the sponsor on the motion to adopt second substitute.

  44. Rep. Norman K Thurston1:12:55

      Yeah. Um, I like the first substitute better, but in this spirit of, I will stick to the deal that I made even when the other guy doesn't stick to the deal that I thought he made. Uh, sub two is the deal that I thought we had. So I'm going to support the motion to adopt second substitute because I thought that's what we had agreed to. In fact, it's a little better than the deal we agreed to, but I'll talk later if I have to about that.

  45. Committee chair1:13:20

      Okay. I'll restate the motion. Motion is to adopt second substitute, uh, HB 2 31. We'll go ahead and do a voice vote on that. All in favor, please say aye. Aye. Aye. Any opposed? No. All right. That motion passes six to one with Representative Abbott voting in the no. Um, we'll come back to the committee.

  46. Rep. Stephanie Gricius1:13:42

      Representative gracious. Yes. Thank you Mr. Chair. I'd move that we favorably recommend House Bill two 30 ones as substituted That motion's in order. Would you like to speak to it?

  47. Rep. Stephanie Gricius1:13:53

      I would. Um, in general, I think lower the rate broaden the base is good. Stable economic policy. This substitute addresses a lot of the concerns that were raised by the county, um, in relation to earmarking in relation to bonding. Um, and I think the sponsors worked a really long time on this and lots of people have had the ability to weigh in. But overall, I just think it's better economic policy. I'd, I'd rather see this spread out than focused on individuals. I think it's weird that we tax a maverick hotdog at a higher rate than we tax a maverick bag of chips, you know, when it comes to restaurant sales. Um, and this just makes sense.

  48. Committee chair1:14:32

      Alright, thank you rep. Thank you representative gracious to the sponsor on the motion

  49. Rep. Norman K Thurston1:14:36

      to favorably recommend second substitute. Yeah, so I appreciate the motion. Um, and I'm just gonna give my some comments now. I hopefully not need to do those again later. So as you heard from public comment, the only substantive opposition to a to second substitute is this theoretical. Um, that it then some counties it may shift from out of towners to locals. The reality is that the data shows that that's trivial at best. Uh, ignores the benefits entirely from, from getting rid of this complex and burdensome tax on the Loa on local small businesses. And then finally, um, it's even if we went down the road, you could theoretically justify it because most of the TRCC funding is spent on amenities. Like, uh, like Mel Signs said that people use, it's spent on facilities that people go to airports and other places that we go to. Arts community. You heard the list of what we're spending it on. That sounds to me like things that I really want in my community and I would be willing to pay another dollar or two a year if I had to. And again, I dispute that it's even that much.

  50. Committee chair1:15:40

      Thank you. Thank you Representative Thurston discussion to the motion to favorably recommend seeing none. We'll go back to the sponsor, representative of the motion Representative gracious Good economic policy. Alright, um, Jennifer, we'll go ahead and we'll do a roll call.

  51. Committee chair1:15:55

      Vote. I'll restate the motion. It's to favorably recommend second substitute HB 2 31 Rex Restaurant tax repeal amendments from Representative Thurston. Representative Abbott. Yes. Acton? Yes. Er no gracious. Yes. Yes. Manga? No. Millard, no. Clancy. Yes. Five to three. That motion passes five to three with Representative Mauga, Oxia and Millard voting in the No thank you Representative Thurston.

• Mar 3, 2026 House floor debate▶ Watch
  Transcript (21 turns)

  1. Speaker (presiding)1:43:13

     Third reading calendar, Second substitute house bill 2 31 Restaurant tax repeal amendments by Representative Thurston, this bill of certain judiciary with a vote of 5 3 3. Representative Thurston.

  2. Rep. Thomas Thurston1:43:27

     Thank you Mr. Speaker Port. Tim, may I have permission to read a brief passage? Granted, The best tax is a neutral tax one that is broad enough to be low and simple enough to be invisible. By broadening the base, lowering the rate, and simplifying the tax calculation. We can stop the government from picking winners and losers and start letting the market work for everyone. So colleagues, um, about 30 plus years ago, we implemented a restaurant tax. And that's actually a bit of a misnomer. It's a food tax, it's a tax on a specific type of food prepared, made to order food. You pay that tax when you get a pizza from Little Caesar's, you pay that tax when you have food delivered by Uber Eats, you pay that tax. When you go to the grocery deli counter and order a made to order meal, you pay that tax when you go to Macy's and get an ice cream cone, that is what this tax is. It is a tax on a very special kind of food, and it's at a very high rate. It's an extra 1% extra 1%. The state sales tax is only three and a quarter percent. There's an extra 1% on top of the existing sales tax. It's a big deal. So when we, uh, had had started having these conversations a year ago about removing the restaurant tax, we said, well, we're gonna have to deal with the counties because this money goes to the counties. And they have used it for specific purposes. We met with him in October. We met with representatives from UAC and we said, what would it take to make this work for counties? And they said, well, there are some very specific that the counties would have namely hold harmless. Every county needs to collect as much revenue, at least as much revenue as they're currently collecting. So you're gonna have to find another way of giving them revenue. You need to protect their ability to bond. A lot of these counties have bonded for projects, buildings, airports and things like that. You're need to be able to protect that. You're gonna need to preserve program autonomy. They need to be able to still spend the money on the things that they're spending money. And you're going to have to have a seamless transition to the new tax base. So no hiccups, just make it smooth. And the group that I was meeting with, which included, uh, representatives from the restaurant association, restaurant from the retail association, rest, uh, members of the tech represented from the tax, uh, payers association, we said, let's get to work on that. 30 days later, we delivered to everybody in the group, a bill that incorporates all of those provisions. Does everything that the representative from UAC asked for. I didn't hear anything at all until the second week of the session. We had, they had, they sat on it from the middle of November to the second week of the session. They said, we don't like it. And I said, well, what do you not like about it? You're getting more money, you're getting autonomy, you're getting a smooth transition. It's a better tax, it's a simpler tax, it's a lower rate on a broader base. What's not to like about it? Well, we're just worried that. And then they put in some blanks, no data. I asked for data, I never got data. Um, and so I said, okay, well let's, let's talk about this then. Let's see what we can do. Okay, so colleagues, I know that some of you have received calls from your county commissioners. Not one of them has called me. Not one zero a grand total of none of them have contacted me to say, help me understand this or help me let you do this better. Not one of them. Do you think that's fair? Do you think that's our process? That if you oppose somebody's bill or you want it, especially when you ask for things that we put in the second sub, um, and then to say, well, we still oppose it, but we would like things better than to just not do that. So anyway, I wanted to give that as the backstory, but lemme tell you all the good things about this bill because enough about personal conflict. Uh, as many of you know, um, lemme see here. This bill changes the base for how this tax is collected. The current base is on this prepared made to order food that is a narrow base and a high rate. When you have a narrow base and a high rate, it discourages economic activity. It's not fair to restaurant owners. It's not fair to the people who work for restaurants. They are being singled out as the source of revenue. It's also unstable during economic fluctuations that money goes up and down. So let's move to a broader base and a lower rate. What would that be? Let's the broadest base that we have available to counties. And I think most of you're aware that we don't have a lot of taxes that counties can charge. You hear a lot about property tax. You hear a lot about some other taxes that they charge, but the sales tax is the one that they rely on the most. This would raise an average of 7% more revenue to the counties. And the rate that we're talking about increasing the sales tax rate is one 10th of a percent. If you buy a $60 pair of shoes, that's 6 cents, 6 cents on a $60 pair of shoes. Like I said in the quote that I read, that is broad based. It's small enough to literally be invisible. Let me dispel some of the other myths that you have heard, just to make sure that we're all on the same page. There is a myth that this is somehow paid by tourists. It's a good thing. It's a free lunch. All these outta towners come to our state and they're wonderful and they come and we can get them for another little bit on the restaurant. And it's a free lunch and we can fund. In fact, one of the mayors told me, she said, I really like this tax because I use it to fund a lot of amenities that my citizens really like. It's a free lunch. Well, it turns out it's not true. KMC Gardner Institute did a study on this exact tax and found that 81% of this tax on food is paid for by us Utahans. We're paying that. So that's the reality. Uh, the second thing as well, it's a luxury tax. Only rich people go out to eat. Only rich people are paying restaurant tax. Well, that may have been true in some alternate universal long time ago, but it's not true today. We have seen in the data, and this is, uh, there was a tax commission study looking at this that shows that household spending on away from home food is dramatically increasing as busy parents rely on quick order services, picking up a pizza, having Uber Eats, having something delivered because you don't have time. The luxury is having time to cook for your children. That's the luxury. The luxury is not the restaurant. This tax is in fact a better deal for the counties. If they will take it, they will. Every single county, all 29 will get more money from this tax, from this change. Every single one of them. It will be more stable. We're heading into an economic downturn. Restaurant revenues will decline. It's inevitable. This will help protect them against that equation. Some of them are really worried about the shift. The shift. You'll hear people say, well, it's gonna be a shift, a shift from out of towners to locals. Well, first of all, there's not much to shift 'cause it's mostly not being paid by out of towners. But when we went back and looked at that Campsey Garden report, we estimated what that shift would be. It's less than the price of a candy bar. The shift onto your neighbors, if there is one at all, is less than the price of a candy bar. And that completely ignores something that you don't see. Baat talked about the scene versus the unseen. The scene is that is what you see. It's what that, that shift. What you're not seeing is the benefit to local businesses. It's complicated to comply with the restaurant tax. The tax commission told me they spend more enforcing this tax than any other tax they have. And it's one of the smallest taxes that they collect. Now imagine if you are a small business, you are selling different types of food in different circumstances, and you've gotta keep track of all of those tax rates. And if you get it wrong, you pay a penalty. You don't get to pass that on to anybody, you pay a penalty. Also, economic economics 1 0 1, when we tax something, we get less of it. This decreases economic activity. It decreases in economic activity in unexpected ways. Again, the seen in the unseen, when you have a 1% tax on food and beverages for a convention, I do this for a living. I arrange conventions. I I shop those to various cities. We ask, what is your tax rate on food and beverage? That 1% may not make a huge difference, but at the margin it is a deal breaker for some business. And we will not see those businesses that choose to go to Denver or Miami because of that 1%. So at the end of the day, I want you to cut through all of the misinformation that's flying around out there, people looking at old versions of the bill, people listening to whatever voices. Um, if you have questions, ask me, I'm happy to answer them. But this has been a long slog. I have worked very closely with the leadership at UAC to try to come up with something that does this in the very best way possible for our small businesses, for our citizens, for our consumers, and for our counties as well. With that, Mr. Speaker, I'll be happy to yield the questions.

  3. Speaker (presiding)1:52:57

     Thank you Representative Thurston discussion to the bill Representative Shipp.

  4. Rep. Shipp1:53:03

     Yeah, thank you. Mr. Excuse me, Mr. Speaker Pro Tem, uh, would the sponsor yield to a couple of questions, The sponsor yield to a series of questions?

  5. Rep. Thurston1:53:15

     I would be thrilled to. Okay. Yes.

  6. Rep. Shipp1:53:17

     Yeah. Mr. Speaker pro tem. Uh, so with the, with this change you mentioned the, the sponsor mentioned that, uh, they would hold the, the counties, uh, hold, there's a hold harmless in it. Uh, how, how are they gonna be able to do hold them harmless? How, how are they gonna calculate how to hold them harmless?

  7. Rep. Thurston1:53:44

     Thank you, Mr. Speaker Porter for the question. The hold harmless is actually quite simple because when we take 1% and reduce that off, this special type of food, we have to calculate a rate to apply to everything else, the broader base. And in that rate calculation, the tax commission won't let us go out to four decimal places to get it exactly right. They don't want to deal with four decimal places. They said we can only do with two. So when you only go to two decimal places, you round up every county will round up to the, to the nearest second decimal place, which means by definition, every county will get more money. And for example, for Salt Lake County, those of you who live in Salt Lake County, that rounding up by itself is $3.5 million a year is not trivial. The rounding up is a lot of money for my own county, Utah County, it's over a million dollars. Weber County, $400,000, and the nu numbers go on and on, but it's roughly 7% increase on average just due to the rounding up to, to the second decimal point.

  8. Rep. Shipp1:54:45

     Yeah. One more question. Go ahead. Yeah, uh, uh, the other question I have is by increasing the revenue to the state by lowering the rate and expanding it, so basically this is a tax increase. Is that correct?

  9. Rep. Thurston1:55:03

     Thank you, Mr. Speaker Pro Tim. Um, sometimes we think about tax increase, tax decrease, and we, we get all wrapped up around that one. There is no way to get this exactly revenue neutral. So we have erred on the side of revenue enhancing. Again, the total amount of new revenue collected or statewide would be roughly $6 million spread across the citizens. It's less than a candy bar per person. It's a tiny amount for us to try to dial it in that close. The more important thing to the counties was, is that they not lose money. So we have guaranteed that no county will lose money because of this, and in fact, because of the calculation they will make, make money on this deal.

  10. Rep. Shipp1:55:45

      Yeah. Thank you Mr. Speaker ProAm. I just wanna make a comment that, uh, I have, uh, people in my area, uh, southern Utah, that are adamantly opposed to this. Uh, they have built infrastructure and so on that's based on this, uh, 1% restaurant tax. I don't think it's gonna encourage more people to go out and eat and generate more revenue for restaurants. And so I'd encourage, uh, you to oppose this. Thank you.

  11. Speaker (presiding)1:56:16

      Thank you, Representative Shipp. Further discussion to the bill Representative Albrecht.

  12. Rep. Carl Albrecht1:56:23

      Thank you Mr. Speaker Pro. Tim, I I want to approach this from a little different angle. I appreciate the good representative from Provo and his comments, but let's talk about taxes for a minute. Overall, we got income taxes, we got property taxes, we got sales taxes. I know I've heard the speaker say that he would like to get rid of taxes, all of those in the state of Utah. Some states have Florida, Texas, Tennessee, Alabama. But look at those states compared to the state of Utah. What's the difference? I'll tell you what the difference is. In Utah, we have 67% of our land that is owned by the feds that cannot be taxed. And so that's pretty important. You know, some of the counties that I serve and the surrounding counties around the areas that I serve, some of them are 90 plus percent federal land. My own county severe is over 90. Wayne County, where I was born and raised is 97% federal. So when you take 97% federal lands, that's BLM, forest Service, park service, and then add some Sitler lands on top of that, that leaves that little county 1% private land. Think about that for a minute. What kind of tax base do they have? Not much. Not much at all. If you take this away, it's gonna hurt those small counties. We've talked about a shift, you know, to from tourism to the locals, but we only get tourism maybe six to eight months a year in those areas. You know, there's two kinds of visitors to those areas. And the area that I live in, in southern Utah, there's those that might go to Costco and buy all of their food, fill up some extra tanks of gas to come to rural Utah to go four-wheeling or boating. They don't buy anything in rural Utah. They eat out of a cooler and they buy their gas at Costco on the way out of town. They bring a hundred dollars bill with them and a clean set of underwear. And they don't change either one. The tourists and the visitors are the ones that help the local economies. They stay, those that stay in a motel and eat in restaurants, they're the ones that's gonna pay this. The counties use this for a lot of things, and you might say it's a subsidy, but I can point to downtown Salt Lake City when that hotel was built next to the Salt Palace and how much money we put into that. Yeah, they use it for airports, arenas, roping arenas, rodeo arenas, ball fields, mountain biking races, county ball fields. They use it for economic development. The people from all over the state of Utah come down there to ride on our mountain bike trails. They come down there to four wheeler on our trails. This is an economic development bill for them, and it helps with their tax base that they don't have. So maybe it would be good to bifurcate, bifurcate the bill if there's folks up here that want it, fine. But I don't think UI took a position of of supporting this bill. Overall, we talked about the shift, and I can tell you that those counties in my area, Garfield Beaver, Wayne Kane, Iron, Washington Grand, they all oppose this bill. And I would encourage my fellow colleagues to think about tax base and what helps rural Utah. And I appreciate, uh, you voting against this. Thank you.

  13. Speaker (presiding)2:01:47

      Thank you, Representative Albrecht. Further discussion Representative Shelley.

  14. Rep. Shelley2:01:53

      Thank you, Mr. Speaker. I also rise in stark opposition to this bill. Uh, I would add to, uh, what the good representative from Sev County, uh, Sanpete s severe Wayne Millard Juab and Piute also, uh, look at this as a, a very, uh, effective bill to it. It would, it would decimate their tourism industry. They rely on it. Now, I, I agree with what the sponsor has said, where the counties are still made whole and he's done his research, but the counties are now made whole by taxing their residents instead of the tourist. The people who come through now in the Salt Lake and Utah counties, uh, you know, maybe going from one end of the valley to the other to go out to eat or something, uh, that is the locals. But down, down in the rural areas, the tourists are the ones who come through. They're the ones who, who eat out and stay in the motels. This is, this is critical tax for the rural areas. Um, and, and to the point that, uh, that individuals have not contacted him. If we as legislators are, are doing our job, our constituents are contacting us, and then we in turn contact the sponsor. Now, sure, they can contact the sponsor directly, but I have had a lot of constituents contact me and I've been in contact with the sponsor, um, and still explained the, uh, the detrimental effect that this bill would have. So I, I strongly encourage your opposition to this bill. Thank you.

  15. Speaker (presiding)2:03:33

      Thank you, Representative Shelley. Further discussion Representative Walter.

  16. Rep. Walter2:03:39

      Thank you Mr. Spreaker pro, pro te uh, I rise in support of this bill, but, uh, for maybe a little bit different reason than was articulated in the sponsor's comments, uh, I want to acknowledge and, uh, uh, thank, uh, the good representatives from severe and Sam Pete for their comments. I, uh, respect, uh, that perspective and, and Phil, uh, strongly about, uh, some of the comments that were made there. Um, uh, frankly in opposition to the bill. But I wanna speak to a specific provision about the reason why I'm rising in support today. Uh, as we look at, uh, this restaurant tax and some of the related taxes, including transient room tax, uh, they've been around for a while and, and they, uh, one of, one of the things that they are designed to do is to give the counties the resources to offset the impacts of tourism. But these taxes also require that 47 cents on the dollar have to be spent on tourism convention and other promotion related expenses. It's a really challenging dichotomy where we're trying to mitigate the impacts of tourism while we are simultaneously promoting tourism. And the restrictions on those funds don't give the counties the ability to allocate those dollars in the way that they would choose or they would prefer. Now, I acknowledge this particular bill doesn't address, uh, that, uh, concern that I've raised, but it's a step in that direction and it's something that's been concerning me for a long time. I wanna speak to specifically our housing affordability and our cost of living concerns in our state. This body, along with the Senate, the Governor's Office, have been working diligently in the, it was the fourth, my fourth session, but over these four years, to try and mitigate some of the rising costs of living, largest of which is housing across our state. And in doing so, we've implemented dozens of policies that would try and essentially shift the supply curve for housing by, in a way that would increase the number of housing units built with the intent to lower the price of housing. We are simultaneously sterilizing that policy by spending hundreds of millions of dollars, more than a hundred million dollars in the counties, uh, through this form of advertising spend and a similar amount at the state to promote and advertise and encourage people from outside the state to come here. I'm grateful for the people that come here and spend their dollars from outta state. I'm happy that they do so, but I wonder if the state and the counties or governmental entities spending those dollars is the right approach, uh, to move forward in the state. It is actually offsetting all of the benefits that we're trying to achieve through all of our policy, all, all of our, uh, housing and other cost of, uh, living, uh, policies. It is structurally inflationary. Yesterday I received an email from a, uh, uh, in my profession. We're working on a, trying to work through a transaction and we're looking at a piece of ground in Washington County for residential homes that is $800,000 an acre. This is for residential homes. The reason why the price is so high is because of demand from people not in Washington County, but from demand from people outside of Washington County. Prices in Summit County in the last 12 months have risen 22%, 22% in Summit County. That's not demand from inside the county. That's demand from outside the county. At some point, I think we have to reconsider how these resources are being used in our communities. I think we have to relook at what we're spending those, uh, tax dollars on. And I applaud the sponsor for making an effort to try and take a step in that direction. I will concede that it doesn't resolve the underlying concern that I'm address that, that I'm addressing in my comments today, but it takes us a step in that direction. And I would hope that as we continue our conversation, I know we had a very difficult debate on transient room tax last year, but as we continue in future sessions, that we'll be able to, uh, uh, address what I think is a structural problem where we're actually creating some of the inflationary pressures that we're trying to fight with the policies inside this body. Uh, appreciate the good sponsor its efforts in this spa, in this space, and encourage support. Thank you, Mr. Speaker Prote.

  17. Speaker (presiding)2:08:39

      Thank you Representative Walter for further discussion. Representative Ballard

  18. Rep. Ballard2:08:44

      Call, previous question, Previous question has been called, which you will in debate.

  19. Speaker (presiding)2:08:48

      All in favor say aye. Aye. Aye. Opposed say no. Motion carries Representative Thurston for summation.

  20. Rep. Thomas Thurston2:08:56

      Thank you. Colleagues. Um, I wanna say this in the most delicate way possible, but some of the comments that you've heard today reflect the misinformation that is circling around among county commissioners. I heard someone say this bill is bad because we depend on this for infrastructure. This bill does not change that this bill promotes and protects the ability of counties to bond for their infrastructure. Does not change that. I heard a colleague say this will decimate the tourism industry, decimate the tourism industry, and at the same time saying we're shifting the tax away from tourists. It makes no sense. Nothing about this bill has any potential to decimate the tourism industry. I heard another colleague say, we depend on this tax because our economy is seasonal. The tourists only come here six months of the year. The other six of the months of the year, we don't have any money. That's exactly the point. The restaurant tax is seasonal for a lot of communities, giving you a more stable, broader base, allowing you to have predictable revenue year round, not just in two quarters of the year. We're still taxing tourists. As my colleague from Washington County mentioned, transient room tax is a real thing. People mentioned staying in motels and hotels, that people still stay in motels and hotels. That tax still gets collected. Tourists will still be buying groceries at Costco. Again, paying the sales tax, right? Tourists will still be eating out at restaurants. The tax restaurant, tax restaurant food will not be free of tax. It'll just be 1% lower. It'll just be the same rate that you pay on other prepared food, like when you get a rotisserie chicken or something like that. So at the end of the day, what does this bill do and why do I want you to vote for it? I'll go back to what I said in the beginning. The best tax is a neutral tax. One that is broad enough to be low and simple enough to be invisible. That's the best tax. It doesn't pick winners and losers. It doesn't punish the restaurant industry because they happen to be the one that tores like that's, which isn't true anyway. But it doesn't punish the restaurant industry. It's applied at a very low rate, applies to all of them evenly. It's a very good way of doing the taxation. Counties are made harmless. It will not impact their infrastructure. It will not impact their ability to have culture arts programs or, uh, the theater downtown or all of these other great things. Airports, parks, trails, all of the stuff they can use this money for will still be there. It does not take away anything from the counties, nothing. They have full control. They have their revenue. They can still bond, they can still use it for everything. The only possible concern, and I want to be upfront about this, is that there might maybe somehow be a small shift in which people pay the tax. That's probably true. Anytime you make a tax change, it's gonna happen. But the question isn't, will the shift happen? The question, is it big enough to worry about? Is it big enough to worry about? We look at the Campey Gardner Institute information and we can calculate the differential between how much locals versus non-resident tourists pay for this text or that text or hotels or motels or all this other stuff. When you compare these two side by side, they're almost identical. The cost shift is probably a few bucks. It's certainly less than a coffee at Starbucks. Not that I would know, but it's certainly less than that and it's probably closer to a Snickers bar. That's probably the ca size of the shift. So why would we throw out the opportunity to have a massive simplification, reduction in administrative costs, reduction in burden on our businesses, reduction in burden on small businesses, reduction in economic distortion that comes from having a high tax on a narrow base. Why would we throw all of that out? Because there might maybe somehow be a little bit of a shift somewhere in the system. I think that's a pretty bad reason to reject this policy. So with that, I would encourage your vote. Thank you, Mr. Speaker ProAm.

  21. Speaker (presiding)2:13:20

      Thank you. Representative Thurston Voting is open on second substitute house bill 2 31 restaurant tax repeal amendments all present having voted, voting will be closed. Second substitute house bill 2 31, having received 21 yay votes and 52 nay votes fails to pass. We refer to staff for filing. Speaker Schultz