According to House Minority Leader Anthony Daniels (D-Huntsville), there has been more "serious conversations" about eliminating the state sales tax on groceries than "any year since" he's been in office.
Daniels told the Business Council of Alabama's Government Affairs Committee on Tuesday morning, "I'm really excited about members of the legislature having conversations including the Lieutenant Governor (Will Ainsworth) has a proposal that he's pushing and so we're certainly excited about those opportunities and we'll see what happens."
"We do have to make certain that we're risk-averse with how we're dealing with the situations moving forward and we're doing it in a very responsible way," Daniels continued. "I do think that we have to look at the elimination of the grocery tax, but at the same time we have to make certain that we're doing it in a way that doesn't cause us any long-term problems from a revenue standpoint and just talk through those things and be open and honest about it."
Multiple proposals are filed to gradually or immediately eliminate the state's sales tax on groceries. Most of the discussions lately have focused on whether to define food in legislation by the WIC or SNAP definition. The SNAP definition covers a broader variety of foods than WIC.
Ellie Taylor, president and CEO of the Alabama Grocers Association, said in an email to legislators last week obtained by 1819 News that "currently, there are only 618 retail vendors that accept WIC, compared to the 4,850 that accept SNAP."
"The WIC Program includes extremely specific items with limitations not only in size but also in nutritional content," Taylor said in the email. "Implementing a tax that only uses WIC products will require a large learning curve not only from consumers but also from the retail side. The Alabama Grocers Association highly recommends using the Supplemental Nutrition Assistance Program (SNAP) definition for the removal of sales tax off food."
Alabama has the nation's fourth-highest state and local combined sales tax rate. Alabama's state sales tax rate is the 40th-highest in the nation at 4%. However, the average sales tax rate levied by local governments is the highest in the nation at 5.25%. Alabama is one of just a few states that taxes groceries at the full state sales tax rate. None of the proposals filed would affect the local rate taxpayers are charged at the grocery store.
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