Budget and Taxes Fact Sheets Policy Areas Reducing Exemptions is Good Tax Reform, But Taxing Groceries is Highly Regressive December 8, 2010 / January 15, 2020 by GBPI Staff All exemptions, credits, and deductions should be examined and weighed against each other and against the principles of tax reform. The grocery exemption, in particular, increases equity and should be weighed against other tax breaks with an equity lens. Eliminating the deduction for state income taxes offers an alternative worth considering. Download the PDF. Read more ยป Fact Sheet State Budget State Taxes tax exemptions