Over the past four years, the Alabama House Republican Caucus has worked to reduce the tax burden on the people of this state in meaningful, lasting ways. Over $1.5 billion in tax cuts have been enacted since 2022. These have not been a single sweeping gesture, but through deliberate, session-by-session work based on specific pressures that Alabama families, workers, seniors and small business owners face every day.
The results are worth reflecting on. We reduced the state grocery tax from 4 percent to 2 percent, recognizing that food is a basic necessity and that the tax on it falls hardest on those with the least margin in their household budgets. We provided a one-time tax rebate that returned $393 million to Alabama taxpayers. We eliminated the minimum business privilege tax for small businesses. We exempted retirement income for Alabamians 65 and older, expanded the standard deduction, doubled the adoption tax credit and created the CHOOSE Act—a refundable education tax credit of up to $7,000 per child for qualifying families.
None of these were easy lifts. Each required building consensus, working through the budget implications, and making the case that returning money to the people who earned it is sound policy.
This session, I carried HB527, which passed the House 100 to 0 and was signed into law by Governor Ivey on April 16. The unanimous vote reflects something important: the underlying policy is common sense. The bill does two things. It establishes a state income tax deduction of up to $1,000 for overtime compensation, covering tax years 2026 through 2028. It further suspends the state portion of the grocery sales tax for May and June 2026, providing two months of direct relief at the checkout line for every Alabama family.
The overtime deduction builds on a principle we established in 2023—that Alabamians who work extra hours to support their families should not see a disproportionate share of that effort taken by the state. The grocery tax suspension is a targeted, time-limited measure that delivers immediate relief while we continue working on permanently eliminating the tax on groceries.
Alabama is already among the most tax-friendly states in the country by most measures. Our property taxes are the lowest in the South, capped at 7 percent by the legislature. Social Security benefits are exempt from state income tax. There is no inheritance tax. These are not accidents of geography; they reflect consistent policy choices made over many years by people who believe that government should be a careful steward of what it collects.
HB527 fits within that tradition. It is a straightforward extension of the work this caucus has been doing since 2022. We’re finding places where the state can ease the burden on working people and doing so in a responsible, sustainable way. I’m proud of what our caucus has done, and I’m even more excited about what is ahead.
