Bill proposes to continue 'junk food' sales tax on Navajo Nation

Noel Lyn Smith
Farmington Daily Times
In a file photo from Nov. 21, 2014, Cashier Vanessa Rodriguez works the register at the Quick Stop gas station and convenience store in Shiprock.

FARMINGTON — A bill that seeks to retain a 2% sales tax on unhealthy foods bought on the Navajo Nation continues to make its way to the Navajo Nation Council.

When the Healthy Diné Nation Act was enacted in November 2014, it included a stipulation that the tax be reviewed by Dec. 31, 2020 for a possible extension by council delegates.

The bill proposes to keep the tax in place and amend the law, which is a set of recommendations from the Navajo Tax Commission.

Tax commissioners explained in a resolution this year that certain provisions of the law are unclear and have created challenges for the Office of the Navajo Tax Commission to "effectively" administer and enforce the tax.

Cashier Vanessa Rodriguez stocks shelves on Nov. 21, 2014 at the Quick Stop gas station and convenience store in Shiprock.

Delegate Amber Kanazbah Crotty, the bill's sponsor, told the Budget and Finance Committee on Nov. 24 that the act's objective is to promote the health of the Navajo people by generating revenue chapter governments can use to develop community wellness projects.

"What's important to note is that revenue collected within the agency stays in the agency for distribution," Crotty said.

She said that as of 2019, the tax has generated approximately $7.58 million. Of that amount, approximately $6 million has benefitted the 110 chapters while approximately $1.52 million has gone to mandatory set-asides like the tribe's land acquisition fund and the veterans trust fund.

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Public comments attached to the bill support its passage while the Navajo Nation Gaming Enterprise pointed out the proposed revisions do not address how the law is applied to side dishes and buffets, a concern the business raised with the tax commission in April 2015.

Casino operators say it's unreasonable to expect cashiers to monitor the food choices patrons make when they select food from a buffet like the one shown in this undated file photo, and then add an unhealthy food tax to the purchase. They argue buffets should be exempt from the tax.

Brian Parrish, the enterprise's interim CEO, wrote that three casinos serve food from buffets and it is unknown what food choices customers will make when selecting items.

"It is unrealistic to expect employees to closely watch a buffet patron's food selections to determine whether each of their specific food choices include 'unhealthy foods and beverages,'" Parrish wrote.

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He suggested that buffets and side dishes, when ordered as part of a meal, be exempt from the tax.

Noel Lyn Smith covers the Navajo Nation for The Daily Times. She can be reached at 505-564-4636 or by email at nsmith@daily-times.com.

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