House committee advances bill to cut sales tax on groceries

MONTGOMERY, Ala. — Alabama lawmakers Wednesday advanced legislation to remove half of the state’s 4% sale tax on food, a proposal that has garnered wide bipartisan support among lawmakers this year.

The House Ways and Means Education Committee approved the tax cut as part of an appropriations package that also included a nearly $9 billion education trust fund budget, the creation of a new state savings account and a one-time tax rebate of $210 per tax person. The bills now move to the full House of Representatives.

Alabama is one of only three states that tax groceries at the same rate as other purchases. Removing the tax has been unsuccessfully proposed for decades in Montgomery, but has finally gained traction this year in the face of the budget surplus and soaring food prices. The proposed legislation would gradually remove the tax, provided there is enough growth in tax collections to offset the revenue loss, until the tax drops to 2%.

Proponents said reducing the tax would help Alabamians every time they walk in the grocery store.

“Untaxing groceries has long been at the top of the list to help regular, everyday working class folks who spend a disproportionate amount of our income on sales taxes like groceries,” Robyn Hyden of Alabama Arise, an organization that lobbies for policies benefiting low-income families, told the committee.

Almost every member of the Alabama Legislature is in support of the proposal. All 35 state senators and 100 of the 105 representatives have signed on as sponsors of the initial legislation.

But some groups, including the organization that lobbies for teachers and public school employees, expressed concern about a loss of revenue for the state education budget.

The 4% tax provides $608 million annually to the state, according to estimates from the Legislative Services Agency.