This past September, the Alabama grocery tax was reduced from four cents to three cents after state lawmakers passed legislation this past session. This type of legislation has been debated for decades but never went anywhere because of the concern about the money that would be reduced to fund Alabama public schools.
However, Alabama has seen record surpluses for both the general and education budgets. With more money to work with, Alabama State Representatives and Senators were finally able to make the first moves toward the ultimate removal of the tax on groceries.
In addition, to the first move, another penny will go away in 2024 if state education revenues grow by 3.5 percent. Thus, within two years, the reduction of the tax at the local grocery will potentially be cut in half. Alabama is one of just a few states that still has a tax on groceries. Thus, Alabama legislators are already looking at what it will take to remove the other two cents as well.
Yet, there are cities that tax groceries in Alabama, so we are now starting to see movement there as well. This past week, the city of Hoover dropped its grocery tax by half a percent as well. The city of Clay cut their tax in half, from four cents to two cents last year.
So hopefully we will see more cities and the state take action next year to provide more relief for grocery shoppers in Alabama.
Paul DeMarco is a former member of the Alabama House of Representatives and can be found on X (formerly Twitter) at @Paul_DeMarco.
