I missed this story from two days ago, in a defeat for Ohio Grocers Association and you (the consumer) a judge ruled friday that Ohio’s Commerical Activities Tax (CAT) as a levy on the privledge of doing business- not an unconstitutional fee on the sale or purchase of food. Read the court decision here.

Here is § 12.13 of the Ohio Constitution:

No sales or other excise taxes shall be levied or collected (1) upon any wholesale sale or wholesale purchase of food for human consumption, its ingredients or its packaging; (2) upon any sale or purchase of such items sold to or purchased by a manufacturer, processor, packager, distributor or reseller of food for human consumption, or its ingredients, for use in its trade or business; or (3) in any retail transaction, on any packaging that contains food for human consumption on or off the premises where sold. For purposes of this section, food for human consumption shall include non-alcoholic beverages. This section shall not affect the extent to which the levy or collection of sales or other excise taxes on the retail sale or retail purchase of food for human consumption is permitted or prohibited by Section 3(C) of this Article.

A CAT tax is a tax paid on commercial activity, which is directly linked to the sale of food, and the cost of the CAT is passed onto consumers. In terms of economics, there is no difference between the CAT tax applying to food and a sales tax applying to food- But apparently, Ohio’s laws are so screwed up that this fact doesn’t matter.

Thank you former Gov. Bob Taft, former Lt. Governor Bruce Johnson, and the Republicans in the Ohio legislature who voted for the CAT.

Dr. Lawson of Capital University has more here at his blog, Division of Labour.