Alabama is just one of a handful of states that charges sales taxes on groceries. GOP gubernatorial candidate Tim James (R) said that if he is elected he will repeal the taxes that Alabamians pay on their eggs, meat, milk, and other foodstuffs. State Rep. Mike Holmes (R-Wetumpka) is not waiting for an election and is determined to change that now.
Holmes told 1819 News that he will soon introduce a bill to repeal the state’s 4% tax on groceries.
“I have 12 co-sponsors now,” Holmes said on Tuesday following Gov. Kay Ivey’s (R) State of the State speech. “I hope to have twice that when I bring this.”
1819 News asked Holmes how much was this going to cost?
“Six hundred million dollars,” Holmes replied.
"How are you going to make that up?" 1819 News asked.
“I am not, I want to do it with cuts,” Holmes replied.
Holmes said that his legislation eliminates just the state tax on groceries. The existing city, county, and school district sales taxes would be unaffected.
1819 News asked House Minority Leader Anthony Daniels (D-Huntsville) if the Minority Caucus supported taking the sales tax off food.
“Absolutely,” Daniels replied. “The Minority Caucus totally supports that.”
State Rep. Laura Hall (D-Huntsville) told 1819 News, “The Democrats have been in favor of that.”
State Senator Arthur Orr (R-Decatur) chairs the Finance and Taxation Education Trust Committee that is tasked with writing the first legislative draft of the Education Trust Fund (ETF).
1819 News asked Orr if eliminating the 4% state tax on groceries was feasible.
“There are going to be proposals,” Orr said. “They may be 1% versus 4%. The estimates are between four hundred million and six hundred million. You can check with the fiscal office for the current estimates. That is a big number. I don’t know where we would make that up.”
Orr warned that the state is experiencing record revenues right now but much of that is due to an influx of federal COVID stimulus dollars.
“I think we need to be careful,” Orr said. “It is important to remember that none of this is sustainable once the federal money runs out.”
During her state of the state speech, Ivey requested a record $8,299,759,929 ETF budget. That request is $627,183,354 more than in the 2022 ETF budget.
Tuesday will be day three of the 2022 Alabama Regular Legislative Session.
To connect with the author of this story, or to comment, email brandon.moseley@1819News.com.