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The South Tucson City Council voted in April to remove a tax on groceries. It takes effect on July 1.

The move eliminated one of two revenue sources for the city.

Leaders are seeking both to help the city’s low-income residents and to attract business after South Tucson's only supermarket, Food City, closed in October 2025.

Food City left because of the competitive market and the city’s grocery tax, South Tucson Mayor Roxanna Valenzuela said. It led many residents to travel one mile south of square-mile South Tucson to El Super in Tucson, which doesn’t have the tax.

She and four others, including Cesar Aguirre, Brian Flagg, Dulce Jimenez and Pablo Robles, voted to remove the tax. Two council members, Melissa Brown-Dominguez and Paul Diaz, voted against the proposal.

"We have some of the poorest demographics. So, none of this made sense to us," Valenzuela said.

According to 2024 U.S. Census data, 30% of South Tucson's 4,550 residents reported living below the poverty line. That’s double Tucson's rate of 14%.

The vote came despite advice from the city's financial advisor to first find additional revenue sources before removing the tax. The city’s 2025 unaudited revenue from the grocery tax was $170,000. That number was projected to be $121,000 in 2026 following the shutdown of Food City in 2025, according to the city’s financial advisor.

Valenzuela said the discussion to remove the tax began several years ago when the council wanted to find a way to save residents money and reduce the city’s “regressive taxes.�

In addition to having a grocery tax, Valenzuela said South Tucson has one of the highest sales taxes in the state. South Tucson's 5% sales tax rate is double that of Tucson’s sales tax rate of 2.3%.

She said the owners of the smaller markets that sell groceries told her they are happy with the move because it will be cheaper for their customers.

Council divided on vote

Not everyone agreed with removing the grocery tax. Brown-Dominguez, who is the vice mayor, was one of two council members who opposed the move.

“I understand completely them wanting to help community members with saving money,� Brown-Dominguez said, adding that now is not the time given the city's deficit.

"It just didn't seem responsible of us to do that," she said.

Brown-Dominguez said the city's resources are already spread thin, and this move could impact important services like the city's public safety, which is one of the budget's biggest expenses.

“Any little thing impacts us in a great way. So, with only 15 full-time officers, that means we have between two and three on duty at any time," she said.

South Tucson facing significant deficit

Facing a $1.6 million deficit for next year, city staff reduced the deficit to $400,000 by cutting costs across departments, freezing non-mandatory training and travel, and more. The smaller deficit also depends on Pima County providing $220,000 in assistance for fire and emergency services, which has not yet been approved.

Lourdes Aguirre, the city’s financial director, said the deficit was caused by a mix of issues, including the loss of COVID-era funds from the American Rescue Plan Act, inflationary increases on operating expenses, the lack of growth in sales tax dollars following the loss of major retailers.

Brown-Dominguez said that with the deficit, resources will be tighter than they already are. She noted that city staff members are already doing the jobs of multiple people.

“It means that the staff is going to have to make tough decisions on a daily basis and really track their expenses,� she said. “It's tough because we are at the lowest staffing levels … at least in the last 20 years of city of South Tucson.�

Valenzuela said the council is taking the deficit seriously and asking staff to look for different ways to balance the budget and to think creatively.

The city will also continue to lean on its jurisdictional partners, like Tucson, Pima County and the Pascua Yaqui Tribe, for help paying for important services like emergency and public safety services, she said.

The mayor, who works for the Casa Maria soup kitchen, said she is a Catholic worker and, through her work, advocates for social justice. She has seen people struggling to survive; people who have lost food stamp access or can’t afford housing.

“Providing access to healthy and affordable food is a necessity. It's not a luxury and I just feel terribly taxing people that are already struggling,� she said.