MONTGOMERY, Ala (WHNT) — Alabama Governor Kay Ivey has signed a bill reducing the Alabama grocery tax into law.
Ivey announced Thursday that she had signed HB479, which will reduce Alabama’s Grocery tax by one percent.
“I have signed HB479, the one percent reduction to the state’s portion of the grocery tax,” the governor said in a statement. “As Alabamians and Americans alike are grappling with tighter times, I am hopeful that this decision by the Legislature to slightly reduce the sales tax on certain food items will be truly felt by Alabama families.”
The bill will reduce the tax on food items from 4 percent to 3 percent. The reduction is not immediate however, the test of the bill says “On September 1, 2023, the tax rate shall be reduced to three percent.”
The bill also has provisions to further reduce the grocery tax to 2 percent when certain conditions are met. The bill calls for that reduction to happen on Sept. 1, 2024, if the estimated growth rate from all other sources of income for the Education Trust Fund for the next fiscal year is at least 3.5 percent higher than the previous year. If that condition isn’t met, the reduction will take place in the first year it is.
The grocery tax has been a topic of discussion for most of this year’s legislative session. In April, every state senator signed on to cosponsor a similar bill that would bring down the grocery tax over four years instead of two.
The HB479 passed the house in May to applause from lawmakers. Rep. Patrice McClammy (D – Montgomery County) said at the time that the bill showed the legislature was listening to residents in need.
“We are here today because the people, the citizens of the state of Alabama, they made a strong statement to each and every one of us that they do not want a tax on groceries, and for once, we are listening to the citizens,” she said.
Before HB479 became law Alabama, Mississippi, and South Dakota were the only states that apply a full sales tax on groceries.