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Navajo lawmakers approve 2% sales tax on snacks, sodas

November 16, 2014

Is an anti-soda trend finally getting a foothold?

Berkeley, California, voters on Nov. 4 approved a tax on sugary beverages. That 1 cent per ounce levy will begin Jan. 1, 2015.

Heading east across the San Francisco Bay, a majority of San Franciscans also supported a soda tax. However, a two-thirds vote on Election Day was needed to enact that tax. Look for health activists to continue the SF soda fight.

And last week, another more localized tax that covers sodas as well as other foodstuffs won approval.

The Navajo Nation Council signed off on a tax on so-called junk food. If enacted, the Healthy Diné Nation Act of 2014 would impose a 2 percent sales tax on items such as cookies, chips and sodas sold within the Southwestern U.S. tribe's borders.

Health Dine Nation Act 2014_snack food tax_Dine Community Advocacy Alliance Facebook page
Photo courtesy Diné Community Advocacy Alliance Facebook page

We non-Navajo speakers read the legislation's title as dine, meaning to eat. That does apply to the tax measure.

But note the accent on the capitalized Diné. The Navajo prefer to be called the Diné, meaning "The People" or "Children of the Holy People."

Second snack tax try: This is the second attempt by the tribal council to enact such tax legislation. In January, the Navajo leaders approved the Healthy Diné Nation Act, adding the 2 percent sales tax on certain unhealthy foods on top of the Nation's regular 5 percent sales tax.

Navajo Nation President Ben Shelly, however, vetoed that bill. He expressed concerns with funding and regulatory considerations that were not included in that version of the legislation.

Shelly said since the 2013 bill did not identify or appropriate funds to pay for the law's administration, it would have created an unfunded mandate. He also cited the bill's increased burden on the already underfunded Office of the Navajo Tax Commission.

Plus, Shelly noted, there was no impact analysis on how the tax would affect local businesses.

Declaring the Navajo Nation not ready for collecting taxes on junk food, Shelly instead called for alternatives such as focusing on health education.

Money to combat health concerns: Advocates of the tax, however, say it is the best way to combat the scourge of health issues that are caused in large part by poor nutrition and rampant consumption of snacks high in fat, sugar and salt.

Poor eating habits are linked to deadly ailments such as heart disease and diabetes. According to the American Diabetes Association, Native Americans and Alaska Natives as a whole have the highest age-adjusted prevalence of diabetes among U.S. racial and ethnic groups.

That data is supported by the Indian Health Service, which says Native Americans are more than twice as likely as non-Hispanic whites to have diabetes, which was the fourth leading cause of death in the Navajo area from 2003 to 2005. In addition, Native children ages 10 to 19 are nine times as likely to be diagnosed with Type 2 diabetes.

"The Healthy Diné Nation Act is the beginning of addressing the dominate culture of unhealthy foods on our Navajo Nation, while creating opportunity for health and wellness initiatives across all chapters," Diné Community Advocacy Alliance member Denisa Livingston said in a statement.

The new sales tax money, estimated to be at least $1 million a year, would go into a Community Wellness Development Projects Fund. The Navajo Nation Division of Community Development would channel the funds to various projects among the nation's 110 chapters. The projects would include farmers' markets, vegetable gardens and exercise equipment.

Once the bill reaches Shelly's office, he has 10 days to decide whether to approve or veto this version of the 2 percent junk food tax.

The tax, however, already has the ol' blog's approval. It is this week's By the Numbers figure.

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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