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On Thursday, the Senate passed a bill, on a vote of 31-0, that would reduce the current tax rate on food in Alabama over the next couple of years.
HB479, sponsored by Rep. Danny Garrett, R-Trussville, will cut the state tax on specific food items from four percent to three percent beginning on Sept. 1, 2023. On Sept. 1, 2024, the rate will fall to two percent only if the Education Trust Fund (ETF) obtains a three-and-one-half percent rate in growth than the previous fiscal year.
Only foods that qualify under the Supplemental Nutrition Assistance Program (SNAP) are eligible for the tax reduction.
The legislation comes after years and decades of attempts to revoke the grocery tax. Sen. Andrew Jones, R-Centre, who carried the Senate version of the bill said converging issues have made this the best time to pass the legislation. Those issues include families trying to overcome rising costs due to inflation and a surplus in the budget.
“This is a good day for the state of Alabama,” Garrett said at a press conference following the bill’s passage. “This is an issue that was really driven at the grassroots level. This is what our constituents wanted, what the citizens of Alabama wanted. And so I was happy to see the Legislature ever come together to do something meaningful and impactful.”
Garrett added that the bill would align Alabama with most states’ policies regarding taxing food. Alabama is one of 13 states that still tax groceries in the country and one of three that offers no form of relief on that tax.
There is a provision in the legislation that will immediately cap local taxes on food at their current rate when the bill is signed into law. This means that any local governing body would not be able to raise the tax on food higher but could still lower it.
Multiple people and organizations released statements following the passage of the legislation. Lt. Governor Will Ainsworth stated his approval of the legislation in a statement saying:
“Today’s passage of our bill that cuts the state sales tax on groceries in half represents the largest tax reduction in Alabama’s history and is a bold first step toward my goal of abolishing it altogether.”
Alabama Arise has consistently supported repealing the grocery tax for years. Robyn Hyden, executive director for Alabama Arise made a statement about how thrilled her organization was that the bill passed and how it will help all Alabamians.
“Reducing the state sales tax on groceries will provide meaningful help for Alabamians who struggle to make ends meet. Alabama Arise is thrilled that legislators listened to the people by voting unanimously for this essential policy change. And we urge Gov. Kay Ivey to sign HB479 into law quickly. Arise members from every corner of our state have advocated relentlessly for decades for Alabama to untax groceries. We cannot thank our members enough for their persistent efforts to make this bill’s passage a reality.”
The Alabama Senate Republicans released a press statement Friday morning with some comments from Jones and President Pro Tempore Greg Reed, R-Jasper.
“With the expected reduction rates of taxes on groceries, Alabamians will experience less stress when it comes to affording food and feeding their families,” Jones said. “I am proud of the Senate Republicans for working to pass this legislation efficiently.”
Reed said the following:
“Attempting to find ways to save our taxpayers money is a constant priority for my colleagues in the Alabama Legislature and this tax reduction on grocery sales is a primary example of our efforts.”
The legislation now moves to Ivey’s desk to be signed into law.
