Individuals and small businesses need some help

By State Rep. Tim Wadsworth

Individuals and small businesses are suffering from a continual increase in taxes, fees, dues, payments, charges, levies, tolls, licenses, tariffs, regulations and anything else that requires money to come out of your pocket. The drain of the pocket book on the Alabamians has got to be reversed. What comes from the Alabama Capitol Building and State House are outflows of monies. It is time to reverse that trend by passing HB303 (Reducing State Sales Tax) and HB302 (Reducing Corporate Income Taxes).

Reduce sales and use tax on food in Alabama. Lets start by a 1 percent cut.

I have introduced legislation to immediately begin the process of helping Alabamians. As you can see from the White House, President Donald Trump reviews an issue and makes a decision. Governor Robert Bentley signed Executive Order 28 creating the Alabama Grocery Tax Task Force to “review the state portion related to groceries and essential food products and recommend to the Governor changes that ensure a fair and equitable tax structure while encouraging a healthier Alabama.”. Thirteen people are appointed to the committee to make a recommendation. The recommendation is due to the Governor by June 1, 2017.

Why do we have to have 13 people meet several times on a simple issue? Why do we have to wait till after the current session to have an answer that cannot be considered this legislative session? Section 40-23-2 Code of Alabama 1975 sets the state sales tax at 4 percent. Section 4-23-61 Code of Alabama 1975 sets the state use tax at 4 percent. The Alabama Fiscal Office has readily available numbers that show that the reduction of each 1-percent of state sales and use tax on food will result in a reduction of state revenue to the Alabama Education Trust Fund of $88,000,000.

We don’t have the money to eliminate the entire 4-percent state sales and use tax on food which would cost $352,000,000. There is a simple solution. Just drop the state sales and use tax by 1-percent and we have given back to Alabamians $88,000,000. We have to start small and gradually work toward our goal of helping Alabamians. We also have to balance maintaining education with helping individuals and small businesses.

The need to act now without wasting taxpayer money on a task force will result in immediate help to Alabamians. That is why I have introduced HB303 that will drop the state sales and use tax on food by 1 percent effective October 1, 2017.

How do we pay for the reduction in sales and use tax? The projected Educational Trust Fund increase is sufficient to cover the cost. It is time to help the disabled, retired, young and old and working citizens of Alabama.

Maybe in the future we can do more.

Support the decrease in food taxes by 1-percent.

Contact your legislator and help us get this passed.

Simple question and simple solutions are needed.

HELP SMALL BUSINESSES AND CREATE JOBS BY DROPPING THE CORPORATE INCOME TAX RATE BY ½-percent (ONE-HALF PERCENT) (FROM 6.5-percent TO 6.0-percent).

Alabama has one of the highest corporate income tax rate in the Southeast:

Alabama – 6.5-percent
Mississippi – 3-percent to 5-percent
Georgia – 6-percent
Florida – 5.5-percent
Tennessee – 6.5-percent
South Carolina – 5.0-percent
Louisiana – 4-percent to 8-percent
North Carolina – 4-percent
Kentucky – 4-percent to 6-percent

The Pursuant to Ernst & Young Accounting Firm, the US corporate income tax is the second highest among the largest 50 economies exceeded only by Japan. They state that a high corporate income tax rate is an impediment to US investment and economic growth.

When you lower corporate income tax rates, Alabama will gain important benefits:

1. Alabama will more competitiveness with neighboring states
2. Capital investment will increase in Alabama
3. More Alabamians will have more jobs
4. Perception will continue to occur that Alabama is a better place to create jobs

Many large corporations have high priced tax lawyers that assist large corporations with tax credits and creative tax planning. Small corporations do not have that luxury. Small corporations and Mom and Pop corporations will benefit from reduced taxes.

The need to increase Alabama’s competitive advantage is why I have filed HB302. The bill drops the corporate income tax rate from 6.5-percent to 6-percent beginning with Calendar year 2019. The reduction in corporate income tax will reduce the Education Trust Fund by $27,000,000.

The projected Educational Trust Fund increase is sufficient to cover the cost. It is time to help small corporations. SUPPORT THE DECREASE IN CORPORATE INCOME TAX FROM 6.5-percent TO 6.0-percent. CONTACT YOUR LEGISLATOR AND HELP US GET THIS PASSED.

To be competitive we must stay competitive.

In the long term, giving back to Alabamians and small corporations will increase jobs and reduce burdens on Alabamians. Lets improve the quality of life in Alabama by reducing the tax burdens. President Donald Trump says be proactive and make your decision.

State Rep. Tim Wadsworth serves the citizens of Winston, Walker and Jefferson Counties.