- The Alabama House of Representatives has approved a bill that would reduce the sales tax on groceries from 4% to 2%.
- The measure has received broad bipartisan support in Alabama this year in the face of soaring food prices and a rare budget surplus.
- Previous attempts to pass similar measures were reversed in Alabama, as the 4% tax provided more than $600 million in funding for education.
On Thursday, Alabama lawmakers proposed legislation to scrap half of the state’s 4% sales tax on groceries, a proposal that has garnered broad bipartisan support amid soaring protests. food prices.
The House of Representatives voted 103 to 0 for legislation that would phase out the tax by one percentage point per year, provided there is sufficient growth in tax revenue to offset the loss of revenue, until the tax drops to 2%. The bill is now moving to the Alabama Senate, where all senators have signed in favor of similar legislation.
Alabama is one of only three states to tax groceries at the same rate as other purchases. Some lawmakers, mostly Democrats, had for decades unsuccessfully pushed for deletion. But the measure has gained popularity this year in the face of the rare budget surplus and consumer frustration with rising food prices. Supporters said the tax cut would help every Alabamian every time they walk into the grocery store.
BIPARTISAN ALABAMA MEASURE REDUCING HALF OF STATE’S 4% SALES TAX ON FOOD ADVANCES IN STATE LEGISLATURE
Rep. Napoleon Bracy, D-Prichard, said the vote had been “a long-standing tax.” their own personal economy,” Bracy said.
The 4% tax provides more than $600 million annually to the state for education funding, according to estimates by the Legislative Services Agency. Efforts to remove the tax in the past have largely failed due to concerns about the loss of education funding. The proposal adopted by the House would not replace income.
Tomatoes sit in a box at a grocery store in Fairfax, Virginia, April 6, 2023. The Alabama House has proposed a measure that would reduce the sales tax on groceries from 4% to 2%. (Al Drago/Bloomberg via Getty Images)
While the measure won broad support, some groups, including the organization that lobbies for teachers and public school employees, have expressed concern about a loss of revenue for the state’s education budget. ‘State.
Allison King of the Alabama Education Association warned a legislative committee on Wednesday that the state’s budget surplus is temporary and would be a permanent tax cut.
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“AEA is not against cutting groceries taxes, but we are against cutting groceries taxes without an equally reliable source of funding to replenish lost revenue,” King said. .
While Alabama is one of the few states to fully tax groceries, most other states have higher property taxes or other sources of revenue to fund education, King said.
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Rep. Danny Garrett, the bill’s sponsor, said GOP lawmakers chose to take many other proposed tax cuts off the table in favor of eliminating the food tax.
“This is a tax cut that we are confident we can sustain without affecting the education trust fund,” Garrett said. If people use the money they save “to buy something else,” it will generate education sales taxes, he said.
