A new grocery tax cut proposal by State Sen. Andrew Jones (R-Centre) was introduced late last week with the entire Alabama Senate signed on as co-sponsors.
In an interview with reporters on Thursday, Jones said, "I think this is the year we can get some good traction on this."
"It hasn't been scheduled yet, but we're going to work to get it moving as quickly as we can," he said. "Work with our folks in the House. I was very thrilled that we have all 35 Senators signed onto the bill. 35 Senators… it's a lot easier to move things and get it done."
Lt. Gov. Will Ainsworth said on Thursday he "wouldn't be surprised" if every member of the House supports the legislation as well."
"This is going to produce a reduction in everybody's bills. I think that's important," Ainsworth said. "Everyone is going to benefit from this. We're one of three states that still taxes groceries where we do. It's time to end that."
Alabama is one of just a few states that taxes groceries at the full state sales tax rate.
A spokeswoman for Gov. Kay Ivey told 1819 News on Friday, "Times are certainly tough for Alabamians and people all over the country, and as Governor Ivey has said, she is committed to providing relief for our Alabama families."
She didn't say if Ivey supported the grocery tax cut proposal.
"She is always open to ideas, discussions and solutions to help the people of our state," Ivey's spokeswoman said.
Ivey's proposed budget for the 2024 fiscal year prioritized one-time rebate checks of $400 for single taxpayers and $800 for married taxpayers filing jointly.
Jones said, "Everything I've heard from constituents and all the polling that I've seen points to the fact that the voters of Alabama want to have grocery tax relief as opposed to a one-time rebate."
"This can be a perpetual rebate year after year if you look at it that way. People will be a lot better off for it because it helps working Alabamians the most," he said. "We're in a situation where we have a lot of resources, and we're able to give back to the taxpayers so this is the year that we can make this happen in a way that doesn't require an additional revenue raise. It's a sustainable drawdown. It helps our friends in the education community. We want to make sure we don't negatively impact the education budget, so I think it's done in a thoughtful way and I applaud the Lt. Governor's leadership in helping push this proposal forward."
The bill would reduce the state sales tax on groceries from 4% to 2% over four years using the SNAP definition of food. The tax would be reduced by ½% per year as long as there is at least 2% growth in the Education Trust Fund (ETF) from the previous fiscal year. The plan would reduce state tax revenue in the ETF by $304 million once fully implemented, according to proponents of the plan.
The legislation would also set the local sales tax rate on food at the general or retail sales tax rate in effect when the legislation is signed into law. Local governments could elect to lower their tax rate on food, but they couldn't raise it if the bill becomes law.
Jones estimated the tax cut, once fully implemented, would save the average Alabama family $200 to $250 annually on grocery costs.
To connect with the author of this story or to comment, email caleb.taylor@1819News.com.
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