MONTGOMERY, Ala. (WHNT) – With Alabama’s legislative session approaching, one lawmaker is proposing a bill to eliminate occupational taxes, or at least put a limit on them.
Sen. Andrew Jones first proposed phasing out the tax statewide by .1% every year — a 20-year drawdown for cities with the highest rate. He said he’s willing to compromise and propose a 1% cap on that tax instead of a total elimination. He said that in Alabama, there are only seven cities that have an occupational tax above 1%.
Five of the six cities in Alabama with the highest occupational taxes –2%– are in Etowah County. City leaders there say they will fight against any bill to phase out that tax.
“There’s no compromising on our tax structure,” Gadsden Mayor Craig Ford said.
Ford said the tax brings in $15 million of their $75 million annual budget. He said that without it, there could be serious cuts.
“We would have to cut almost 35 policemen out of 90 policemen. We’d have to shut down half of our fire stations. We’d have to shut down our parks and rec, we’d have to shut down the falls, we would no longer be able to pave roads,” Ford said.
Attalla Mayor Larry Means agreed with Ford, adding that the five mayors in Etowah County are all on the same page.
“I’ve never seen the mayors in this county be so united on an issue,” Means said.
Means said his city would lose about 14% of its revenue and with that, essential services.
“And we don’t want to do that– especially emergency services, police, fire,” he said.
Jones argued the occupational tax is a regressive tax on having a job, adding it disincentivizes businesses from setting up shop.
“It’s a sad day when you have a group of mayors on one hand that are so out of touch with their public,” he said.
Jones said there are other problems with the tax, too. For instance, when emergency workers come to restore power lines after a tornado, they shouldn’t be taxed by the city they are temporarily working in.
He also said those working remotely should not pay taxes for a city they don’t live in.
Jones plans to file a bill at the start of the session, where he thinks there will be support for it in the legislature.
“If that means me having to stand with my citizens, and these five mayors being out on a limb by themselves, I guess that is what it is, but I think we all need to sit down and work out something that’s going to be good for the taxpayers,” he said.
The five mayors of Etowah County will be meeting with Jones Tuesday to discuss this issue.