McGrath: Should supermarkets solicit charitable donations?
By David McGrath May 18, 2012 10:22PM
Some supermarkets pressure customers at checkout into donating money to charitable causes and then take a substantial tax deduction to get a smaller tax bill, columnist David McGrath says. | File photo
Updated: July 1, 2012 12:12PM
Tell me you haven’t been there.
You’ve filled your grocery cart, are feeling pretty good about many of your purchases being on sale and you have a stack of coupons for discounts on several other items.
At checkout, the cashier is friendly, even remarking on all the money you saved. The two of you chat briefly about the weather. She announces the total amount that you owe, and you hand over your credit card.
“Would you like to donate $1 to help feed the homeless?” she asks, holding your card in her hand as she awaits your answer.
Two customers in line behind you watch your face. You glance at the bag boy who’s sliding your ice cream into a freezer bag.
One dollar is not much, especially after you’ve saved nearly $7 in coupons and on sale prices. And you have no objections to aiding the homeless because you regularly donate to food drives.
But there’s something nettlesome about being asked in public, with your wallet out, instead of you choosing to donate when and where you want and on your terms. The pressure is unsettling and unfair.
It galls you that the supermarket chain most certainly had this strategy of persuasion in mind. It could have a donation box for food items or a container for cash contributions at the exit. But it orders their cashiers to ask you directly and out loud for this very reason. It’s a hard sell.
You could just say no, that you already gave. But the cashier and customers will assume you’re lying because any effort to explain why you can’t give $1 feels like overkill.
You hate that the store is placing you in this position. Why on earth does it do so? It turns out there are millions of reasons. As in millions of dollars.
At least that’s the case with Publix, the Lakeland, Fla.-based grocery chain that has 757 stores in Florida and that’s using charitable donations to dodge corporate taxes, according to the Lakeland’s newspaper.
That’s right — instead of paying its share of Florida’s corporate state tax of 5.5 percent, Publix pays only 3.9 percent thanks to loopholes, including charitable donations.
Publix tries to shame you in public into donating to the food drive or to whatever is its current cause and then takes a substantial tax deduction to get a smaller tax bill, which means that taxpayers have to make up the difference.
The assumption is that Publix is not claiming customers’ donations on its tax return, only the amount with which the company matches or exceeds customer contributions. Yet that delineation of information is not available.
In summary, they put the arm on you for purposes of corporate philanthropy to improve their PR, which translates into subtle advertising and concomitant sales. And then they write it off for a nice tax deduction.
Is Publix alone in this duplicitous strategy? Probably not, but so far, it’s the only supermarket chain that has been singled out publicly.
But if your local store solicits donations, check the website of the Institute on Taxation and Economic Policy for the rate of corporate state tax it has been paying.
Feeling manipulated? You bet. But it’s not the cashier’s fault. He or she is told to ask you by the store manager. If they don’t ask, they will make their bosses unhappy.
And it’s probably not the manager’s fault. He or she is likely being strong-armed by their boss at corporate headquarters to meet a charity-collection quota for the sales quarter.
So next time you’re in the checkout lane and are asked to contribute, flash a big smile and tell the truth.
“Yes, I will. But I’ll make my donation from home, thank you. I know you’re just doing your job, but your company could be using charity to dodge corporate income taxes. You can read about it in the SouthtownStar.”
Former Oak Forest resident David McGrath is an emeritus English professor at the College of DuPage who writes frequently on politics and education.