The Alabama Senate voted 31-0 Thursday to pass HB 479, a bill to reduce the state sales tax on groceries beginning Sept. 1. The bill now goes to Gov. Kay Ivey. Alabama Arise executive director Robyn Hyden released the following statement Thursday in response:
“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 HB 479 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. Today is a testament to what’s possible when Alabamians of all races, genders, incomes and beliefs work together toward a vision of shared prosperity and a brighter future.
“This grocery tax reduction will benefit every Alabamian. And it is an important step toward righting the wrongs of our state’s upside-down tax system, which forces Alabamians with low and moderate incomes to pay a higher share of their incomes in state and local taxes than the wealthiest households.
“We appreciate Rep. Danny Garrett, Sen. Andrew Jones and Lt. Gov. Will Ainsworth for guiding HB 479 through the Legislature. We’re thankful for Rep. Penni McClammy and Sen. Merika Coleman for championing legislation on this issue this year. And we’re grateful for former Rep. John Knight, former Sen. Hank Sanders, Reps. Laura Hall and Mary Moore, and so many other legislators whose determined work over so many years laid the groundwork for this moment.
What should happen next
“Reducing the state grocery tax is a vital step toward the goal of ultimately eliminating it. The grocery tax is a cruel tax on survival, driving many families deeper into poverty. Quite simply, there are many better ways for Alabama to raise revenue than taxing a necessity of life.
“It will be important to ensure grocery tax elimination doesn’t harm our children’s education in the long term. The state grocery tax brings in more than $600 million a year for the Education Trust Fund. That’s about 7% of this year’s total ETF budget, making it a significant funding source for public schools.
“Revenues are strong enough for now to reduce the grocery tax without causing severe harm to education funding. But history tells us that good economic times won’t last forever. In the coming months, lawmakers should identify and agree to a sustainable solution to end the rest of the state grocery tax.
“Arise is open to numerous ideas for replacement revenue, and we look forward to working with the state’s new Joint Study Commission on Grocery Taxation to find a path forward. We continue to support our longstanding proposal to replace grocery tax revenue by capping or ending the state income tax deduction for federal income tax payments. Alabama is the only state to allow this full deduction, which overwhelmingly benefits the wealthiest households. Closing this skewed loophole would protect funding for public schools and ensure Alabama can afford to end the state sales tax on groceries forever.”