Gov. Kay Ivey announced during her State of the State address in March her proposal to issue rebates of $400 per tax filer out of the state’s historic budget.
A Senate committee slashed that to just $100 per filer on Wednesday as it approved its version of the supplemental Education Trust Fund budget for the state.
The 75 percent reduction from Ivey’s proposal takes the cost of the rebate down to $275 million from the more than $1 billion it would have cost to issue $400 rebates.
The change is part of the $2.8 billion supplemental ETF budget that the Senate approved Wednesday and could be considered by the full Senate today.
The committee did not take up a bill to cut in half the state’s tax on groceries, but Chairman Arthur Orr, R-Dothan, hinted that the legislation will be factored into the education budget, noting that it is co-sponsored by every member of the Senate.
The grocery tax elimination has been framed as an alternative to the offered tax rebate.
The Alabama GOP released the results of a poll in April that showed 82 percent of respondents preferred tax cuts on groceries over a tax rebate.
The Senate version of the bill would represent a $304 million tax cut according to Lt. Gov. Will Ainsworth.