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Ivey to pursue tax rebate in upcoming session

Ivey said the state’s surplus revenue is “unsustainable” and cannot be use to make permanent structural change.

Gov. Kay Ivey speaks to Prattville and Millbrook Rotarians at the Willis Bradford Branch YMCA in Prattville. Jacob Holmes/APR

Republican leaders in the Legislature have already been hinting at a potential tax rebate for Alabamians in the coming session, and now Gov. Kay Ivey has expressed her support as Alabama enjoys a temporary surplus of federal funding.

“I have spoken to folks across the state, and people are feeling the pinch of today’s economy, and I have committed to them that I want to provide some relief to their pocketbooks,” Ivey said in a statement Monday. “As we move through the November election cycle, I will work closely with the Legislature to provide relief directly to the people of Alabama. I will present a plan to the Legislature to allocate these funds in a manner that helps our citizens with the issues that we face today, while also considering our children and their future.”

House Majority Leader Nathaniel Ledbetter, R-Rainsville, and Sen. Arthur Orr, R-Decatur, both previously signaled support for passing a tax rebate to distribute some of the surplus funds to taxpayers.

The state’s Education Trust Fund ended the 2022 fiscal year with a historic $10.4 billion in revenue, more than 20 percent higher than 2021. The bulk of that surplus is due to an inundation of federal funding in response to the Covid-19 pandemic.

Ivey said it would be irresponsible for the state to use such “unsustainable” funding to make sweeping changes.

“In fact, these revenues are historic, but completely unsustainable,” Ivey said. “No doubt, this surplus is a direct result of reckless spending by the federal government. Many predict – and I agree – a potential downswing in the economy is right around the corner. We must ensure both Alabama and her citizens are in the best possible position to weather any future economic circumstances. We all know the bills have got to be paid one day, and we cannot make permanent structural change because of temporary circumstances.”

Jacob Holmes is a reporter at the Alabama Political Reporter. You can reach him at [email protected]

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