Abstract

Grocery (food sales) taxes exist in over one-third of U.S. counties but do not apply to purchases made with the Supplemental Nutrition Assistance Program (SNAP). We examine the impact of grocery tax rates on food insecurity, and its differential impact on SNAP participants and non-participants. By using data from the Current Population Survey Food Security Supplement matched with county-level grocery tax rates, we found that grocery taxes had a positive impact on increasing only the probability of non-SNAP households being food insecure. Such result implies that the SNAP program also indirectly reduces food insecurity by shielding participants from the negative effects of grocery taxes. Policy makers should target eligibility of non-participating SNAP households in states that tax food in order to reduce food insecurity.

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