Grocery tax to drop after Alabama passes bill
Alabamians should soon see a drop in their grocery bills after a bill to reduce the state tax on groceries passed the Senate Tuesday. It passed the House in March and is on its way to the governor's desk.
House Bill 386 decreases the tax from 3% to 2%. This is expected to save customers more than $120 million a year.
In 2023, the tax was cut from 4% to 3%.
Sen. Danny Garrett, a Republican from Trussville, sponsored this year's bill. He said after that cut two years ago, the plan was to leave the tax rate alone until revenues recovered from other sources. But, Garrett said with grocery prices rising, it couldn't wait.
鈥淢ost of that sales tax on groceries is at the local level, and that's why we gave the locals the ability to reduce that if they want to," Garrett said. "Hopefully, one day, we'll get to the point of no tax on groceries, but even with that grocery tax, when you look at all taxes combined, we're the lowest tax state per capita in the country.鈥�
Alabama is one of 10 states that charge a grocery tax.
Customers anticipate the bill will benefit them and their entire households.
鈥淎 lot of people price shop, so groceries is a big item between rent and food cost, that's what we spend the majority of our money on,鈥� explained Jimmy Brogden.
鈥淚鈥檓 trying to eat more natural foods, and so that's really expensive, you know, and trying to get organic stuff, that's very expensive,鈥� stated shopper Julie Curtis.
Store owners hope to see the trend continue. 鈥淚 know that's great for our customers. When you think about how many times you're going into a grocery store throughout the year it adds up very quickly,鈥� said Piggly Wiggly owner, Andrew Virciglio.
Once the bill is signed by Governor Kay Ivey, the state tax cut will go into effect in September.
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