|
Getting your Trinity Audio player ready...
|
On Tuesday, the Alabama Senate passed HB386, introduced by Rep. Danny Garrett, R-Trussville, which would reduce the state grocery tax in Alabama from 3 percent to 2 percent. The House quickly approved the Senate’s amendments to the bill, sending the legislation to Gov. Kay Ivey’s desk.
The bill, which received overwhelming bipartisan support in both chambers, builds on the Alabama Legislature’s unanimous decision to reduce the state grocery tax from 4 percent to 3 percent in 2023. Alabama is one of only 10 states that still tax groceries, although three of those states only permit such taxation at the local level. Earlier this year, Kansas completely eliminated its sales tax on groceries, adding to a growing national trend.
According to USDA cost-of-food estimates, HB386 would save the average Alabama family of four around $150 per year. Alabama Arise, the statewide non-profit focused on combatting poverty, has been one of the biggest advocates for reducing — and ultimately eliminating — the state’s grocery tax to lessen its financial burden on Alabama families.
“Reducing the grocery tax will make it easier for every Alabamian to make ends meet, especially in this time of persistently high food prices. Alabama Arise is thrilled to see the widespread, bipartisan support for reducing the state sales tax on groceries. And we urge Gov. Kay Ivey to sign this bill into law quickly,” said Alabama Arise Executive Director Robyn Hyden in a statement Tuesday. “The state grocery tax reduction from 4 percent to 3 percent in 2023 was an essential first step toward tax justice in Alabama, and this year’s bill continues that momentum.”
Although Hyden applauded the legislature’s reduction of the tax, she also made it clear that Arise will continue to push for the complete elimination of the grocery tax altogether, proposing alternative revenue sources that would not harm everyday Alabamians.
“The grocery tax drives many families deeper into poverty, and Arise remains committed to the goal of eliminating it entirely,” Hyden stated. “Arise members from every corner of our state have advocated relentlessly for decades for Alabama to untax groceries. Our work will continue until the state grocery tax is in the dustbin of history where it belongs.”
“Arise is open to numerous ideas for replacement revenue, and we will continue working with the state’s Joint Study Commission on Grocery Taxation to find a path forward,” she added. “We continue to support our longstanding proposal to replace grocery tax revenue by capping or ending the state income tax deduction for federal income tax payments. Alabama is the only state to allow this full deduction, which overwhelmingly benefits the wealthiest households. Closing this skewed loophole would protect funding for public schools and ensure Alabama can afford to end the state sales tax on groceries forever.”
HB386 is now in the hands of Gov. Ivey, who will either veto the bill or sign it into law. If signed, the grocery tax reduction would go into effect on Sept. 1 of this year.
