Alabama’s grocery tax reduction now in effect

Alabama has taken an important first step toward untaxing groceries. HB 479 took effect Sept. 1, reducing the state sales tax on groceries from 4% to 3%. The law will reduce the tax by another percentage point as soon as September 2024, as long as Education Trust Fund (ETF) revenues grow by at least 3.5% over the previous year. This policy change will help families keep food on the table and ease financial strain for Alabamians with low incomes.

Smiling Alabama Arise staff members and current and former legislators stand behind and to either side of Gov. Kay Ivey, who is seated at a desk in the Old House Chamber in the State Capitol in Montgomery. — Alabama Arise staff participated in the signing ceremony for HB 479 on July 20 at the State Capitol in Montgomery. The law will cut the state grocery tax in half as soon as September 2024. From left to right: Rep. TaShina Morris, D-Montgomery; Arise organizing director Presdelane Harris; Arise executive director Robyn Hyden; Rep. Penni McClammy, D-Montgomery; former Rep. John Knight, D-Montgomery; Rep. Danny Garrett, R-Trussville; Rep. Mary Moore, D-Birmingham; Gov. Kay Ivey; Alabama Grocers Association representative Pat McWhorter; Sen. Andrew Jones, R-Centre; Arise policy and advocacy director Akiesha Anderson; Arise communications director Chris Sanders; and Rep. Rolanda Hollis, D-Birmingham.

The law’s enactment came after decades of persistent advocacy by Alabama Arise members. Several Arise staff members celebrated at a ceremonial bill signing July 20 at the State Capitol in Montgomery. Numerous legislative champions also attended the event, including Sen. Andrew Jones, R-Centre; Reps. Danny Garrett, R-Trussville, and Penni McClammy, D-Montgomery; and former Rep. John Knight, D-Montgomery.

Arise remains committed to eliminating the rest of the state grocery tax responsibly and sustainably. Those efforts will include working with policymakers to protect ETF funding by closing tax loopholes skewed in favor of wealthy households and highly profitable corporations.