Utahns want lower sales tax but favor tax on services not now subject to tax

Half of Utah voters support a lower sales tax rate and a strong majority favor taxing services currently not subject to a sales tax, according to a new survey undertaken by AARP.

The survey of Utah registered voters 18 and older indicates that 50 percent support a sales tax of 3.1 percent, down from the current 4.85 percent. It also shows that while 84 percent of those surveyed oppose a new sales tax on medical insurance premiums and 79 percent oppose such a tax on rent, at least three of five voters would tolerate the state taxing elective medical services such as plastic surgery (67 percent), dry cleaning services (66 percent), lodging services like hotels or home/accommodation sharing (65 percent) and professional consulting services (60 percent).

Survey respondents also showed support for increasing sales taxes on certain products, often referred to as “sin taxes.” They include e-cigarettes and vaping devices (83 percent), tobacco (80 percent), and beer and alcohol (79 percent). Sixty-six percent “strongly support” a tax on e-cigarettes and vaping products, and 64 percent strongly support increasing the tobacco tax.

In contrast, 51 percent of respondents strongly oppose increasing the gasoline tax, while 20 percent somewhat oppose it. Thirty-two percent strongly oppose and 22 percent somewhat oppose increasing state licensing/user fees, and 30 percent strongly oppose and 14 percent somewhat oppose creating a statewide tax on sugary drinks.

Seven in 10 survey respondents support eliminating the existing tax on Social Security benefits and 72 percent would support — strongly or somewhat — keeping the existing tax on Social Security benefits, but only if there is an offsetting tax credit for both existing and future retirees.

Utah is one of only 13 states that still tax Social Security benefits. Lower-income retirees receive a small tax credit each year for the Social Security taxes they pay, but that credit is being phased out for future retirees. According to the Social Security Administration, the average Social Security benefit in Utah is just over $1,400 a month, and 45 percent of unmarried persons nationwide rely on Social Security for 90 percent or more of their income.

The survey also considered tax earmarks. All state income tax revenue is used for public education. Sixty-seven percent of respondents want to maintain that constitutional requirement, but 40 percent want that funding dedicated to only K-12 education and 57 percent prefer to see it used for both K-12 and state colleges and universities.

The survey was conducted in August by Alan Newman Research. Details are at https://states.aarp.org/utah/.