What to Expect on October 1st: New Tax Increases

Posted on September 27, 2019 by admin


October 1st marks the onset of millions of dollars in new tax and fee increases on some of our most-commonly consumed goods and services. These taxes, along with those that went into effect in July, were included in the Democrats’ state budget plan that passed in June, and will undoubtedly have a negative impact on the families, seniors, and businesses in our community.

You will notice increased costs on:

Digital Goods – The current tax on digital goods of 1% will increase to 6.35%. This increase applies to a myriad of online services, including – but not limited to – streaming (e.g. Netflix, Hulu), music (e.g. Spotify, Apple Music), eBooks, software downloads, and in-app purchases made on smartphones.​​​

With an increased percentage of residents streaming and downloading their content (e.g. music, movies, smartphone apps, etc.), as opposed to watching on traditional cable television or listening on the radio, Democrats are taking advantage of those who are fleeing cable for lower cost options to create a new revenue stream.

Prepared Foods – Consumers will see a 7.35% tax on certain prepared foods. Last week, the Department of Revenue Services released a revised bulletin backing off their unexpected interpretation of what items were to be affect by this tax increase. However, despite what Governor Lamont and legislative Democrats say, many food items we buy from grocery stores are still at risk of being slapped with a new tax. The only way to protect consumers from being hit with this regressive tax is to call a special session and remove the part of the law that taxes groceries, which I petitioned for but Democrats have refused to do.

Motor Vehicle Trade-In Fees – The current motor vehicle trade-in fee of $35 will increase to $100. Instead of being rewarded for trading in an old vehicles for a new, more efficient model, car buyers are being punished with higher costs. This tax hurts not only families who need to upgrade their vehicles, but also businesses who rely on fleets of vehicles to facilitate their everyday operations.

Alcohol – The excise tax on all alcohol sales, except beer, will increase by 10%. This significant increase will be felt by consumers and package store owners, small and large, across the state.

I am just as appalled and disappointed as you are in regards to these new taxes. I will continue doing my best to represent your voice against new taxes, and in favor of sustainable long-term policies, like reduced spending, to address our fiscal crisis.