Alabama House passes bill to cut state sales tax on food

A bill to cut Alabama’s sales tax on food moved closer to becoming law tonight, winning approval in the Alabama House of Representatives.

HB479 by Rep. Danny Garrett, R-Trussville, would cut the 4% tax to 3% on Sept. 1 of this year. On Sept. 1, 2025, the tax would drop to 2%.

When fully implemented, the tax is expected to save Alabama taxpayers about $300 million a year. The bill passed by a vote of 103-0. It moves to the Senate, where support is expected to be strong. All 35 senators signed on as sponsors or co-sponsors to a similar bill.

Lawmakers have introduced bills to reduce the grocery tax for decades but none has ever passed, partly because the sales tax revenue goes to the Education Trust Fund to support public schools.

The reduction to 2% in 2025 would be delayed if projected growth in revenues to the ETF are less than 2% in fiscal year 2025. Garrett said he did not expect school funding to suffer.

“This is a tax cut that we are confident we can sustain without it impacting the Education Trust Fund,” Garrett said.

Advocacy groups, including Alabama Arise, have said for decades that Alabama’s tax on food hurts low-income families who struggle to pay for other necessities like housing and medicine. Alabama is one of only three states that does not offer a reduced tax rate on food.

More recently, inflation has helped drive support for cutting Alabama’s food tax. The price of food rose 7.7% from April 2022 to April 2023, according to the U.S. Bureau of Labor Statistics.

HB479 specifies that the tax cut will apply to foods eligible under the Supplemental Nutrition Assistance Act, or SNAP, previously called food stamps.

The bill does not reduce sales taxes on food collected by cities and counties. It does prohibit cities and counties from raising their sales tax on food above the level it is when the law takes effect. Some representatives said they did not want to take away the authority of local governments to control their own tax rates.

“I don’t feel like that’s our place to do that,” Rep. Ron Bolton, R-Northport, said. “I think that is the voters place to do that, to turn them out.”

But the House rejected Bolton’s amendment to give cities and counties some flexibility to raise taxes on food.

After the bill passed, several Democrat lawmakers called attention for former state representatives who championed the repeal of the sales tax on food without success. Rep. Juandalynn Givan, D-Birmingham, suggested naming the bill after former Rep. John Knight of Montgomery, longtime sponsor of a bill to repeal the food tax.

Read more: How a grocery tax cut will help Alabama’s aging, rural population

After 31 years, why is there momentum for Alabama Republicans to cut the grocery tax?

‘Untax our food’: Alabama could renew focus on grocery tax as food prices soar

Advocates for low-income families call for Alabama to stop collecting sales tax on groceries

This story will be updated.