MONTGOMERY — The Alabama Senate is currently working on the House-passed tax cut package to “make it even better,” according to State Sen. Pro-Tem Garlan Gudger (R-Cullman).
The Alabama House of Representatives passed a four-bill tax cut package sponsored by Education Trust Fund (ETF) budget chairman State Rep. Danny Garrett (R-Trussville) nearly a month ago without any opposition.
The package addresses taxation on groceries, income tax deductions, and retirement plan deductions.
The package passed by the House included House Bill 389 (HB389), increasing the range of optional standard income tax deductions. House Bill 388 (HB388) doubles the state's tax exemption for retirement plan withdrawals for those 65 years of age or older. House Bill 386 (HB386) would decrease the state's grocery tax by an additional 1%, cutting the total tax in half since 2023. Legislation by House Minority Leader Anthony Daniels (D-Huntsville) to make a soon-to-expire tax exemption on overtime pay permanent wasn’t included in the package.
The Senate hasn’t taken any action on the tax cut package so far. Senators said there would be some changes to the package but didn’t share any details about their plans.
“We are working on the tax package to enhance and make it even better,” Gudger told 1819 News on Tuesday.
State Sen. Arthur Orr (R-Decatur) told 1819 News on Wednesday, “We’ll have more details taking shape over the weekend but one of the things that stands out: what can we do for small business?”
“That’s one of the things that’s getting a very close look but there are other things that we are also looking at,” Orr said.
Legislation by State Sen. David Sessions (R-Grand Bay) increasing the state’s business personal property tax exemption from $40,000 to $100,000 passed the Senate Finance and Taxation General Fund on Wednesday.
There are eight days remaining in the legislative session.
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