Trade organizations enthusiastic about Washington bill to exempt supplements from taxes

By Hank Schultz

- Last updated on GMT

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Related tags Dietary supplements Dietary supplements industry health care costs Prevention Tax laws

A bill introduced this week in the Washington State Senate would exempt dietary supplements from state sales and use taxes.

 The bill was introduced by GOP State Sen. Mike Padden, who represents an eastern district that includes the city of Spokane.  The bill was cosponsored by fellow Republicans Judith Warnick, Randi Becker and Lynda Wilson as well as Democrat Sen. Bob Hasegawa.

Candy is tax free; supplement’s aren’t

The bill’s language​ notes that, “[S]cientific research indicates that dietary supplements help in managing certain health conditions and are beneficial to overall health. Preventative care, such as the use of dietary supplements, not only promotes health but also offers significant health care cost savings.

“Many unhealthy foods, such as candy, remain tax free in Washington, while the state continues to profit from certain health-conscious items, such as dietary supplements,”​ the bill continued.

Sen. Padden’s office did not respond in time for publication to a request for comment on why the bill was introduced at this particular time.

Proposal dovetails with agendas of trade organizations

Daniel Fabricant, PhD, president and CEO of the Natural Products Association, said in a statement that the proposal mirrors much of his organization’s thinking on helping Americans to afford this low cost and effective form of self care.

“We love the idea. Whether it’s pushing on FSAs (flexible spending accounts) to cover supplements or removing state sales tax like this proposal, how can you not incentivize people to stay healthy?”​ he said.

“Exempting or deferring taxes is a terrific, no cost way to tell Americans that we want them to spend money on self care for their health and wellness. The data supports that those who take supplements have better health outcomes over their lifetime so this is one of those rare policy areas where there isn’t a real downside to be found,” ​Fabricant added.

Julia Gustafson, the new vice president of government relations at the Council for Responsible Nutrition, also said the proposal mirrors policies CRN has been advocating for years.

“We are very supportive of people using supplements to support a healthy lifestyle,”​ Gustafson said. “Overall this falls into CRN’s broad agenda of encouraging tax policies that help people afford supplements.”

Gustafson pointed to research sponsored by CRN that shows that supplements can help reduce health care costs​.  A Frost and Sullivan report commissioned by CRN found that the supplement regimens surveyed could cut as much as $12 billion from health care costs.  According the Centers for Disease control, 75% of health care dollars in the US go toward the treatment of chronic disease, with only 3% spent on prevention. 

AHPA: Exemption idea has precedents

Michael McGuffin, president of the American Herbal Products Association, said the idea is not without precedent.  At least New York State and Illinois already exempt supplements from sales taxes.  And considering that supplements are regulated as a subset of foods, the idea makes sense, he said.  Already 32 states don't place a sales tax on food purchases, and another 10 states have some form of tax abatement for food sales.

"AHPA supports any action that can remove financial barriers for consumers to have access to dietary supplements,"​ he said.

apha supoprst any anciton that revmoes any finanicnto barrier tha tconsumer hage to access to dietary supplements


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