Revenue Commissioner Reagan Farr called a proposal to raise taxes on sexually-oriented goods and services in order to balance a reduction in grocery sales tax "incredibly fiscally irresponsible."
Farr told the tax subcommittee of the Senate Finance Committee on Tuesday that the proposed bill was "bad tax policy on any number of fronts."
"You're shifting from a population of taxpayers who are stable and identifiable -- grocery stores -- and shifting the tax burden to a base of taxpayers that are not stable and very difficult to identify," said Farr. "We would have difficulty collecting from them."
Farr also took issue with the bill's main sponsor, Rep. Stacey Campfield (R-Knoxville), who he said never contacted the Revenue Department before presenting the proposal.
Campfield is calling for a 25 percent tax on adult video stores, escort services, adult movie rental and pay-per-view subscriptions and other adult materials such as magazines and books. He would also charge "adult cabaret" performers an annual $400 occupational privilege tax.
"Every penny that is raised from this goes directly toward reducing the sales tax on whole foods, which are really health foods," Campfield said.
According to the Associated Press, the subcommittee voted 2-1 to give the bill a negative recommendation, but under Senate rules it will still advance to the full Finance Committee for consideration.
