The 2023 legislative session is almost over – just one day left. The big news of the week is the reduction of the state grocery tax and the rebates that most taxpayers will receive.
This week, we gave final approval to a historic tax cut that will slice the state sales tax on groceries from 4% to 2%. Once signed by Gov. Ivey, the law will reduce the sales tax from 4% to 3% effective September 1, 2023 and from 3% to 2% whenever revenues in the Education Trust Fund grow by at least 3.5%, which could occur as soon as next fiscal year.
Removing the first 2% of the sales tax will save the average family between $200 to $250 annually. In order to protect the tax cut, cities and counties may not raise local sales taxes on groceries, but they may keep them at their current levels or reduce them, if they wish. The bill uses the same definition of groceries as the federal food stamp program, known in D.C. nomenclature as SNAP, which means all groceries will be covered except for pre-prepared, hot food from grocery store delis.
On Thursday, the legislature gave final passage to a measure that will provide state income tax rebates of $150 for individual filers and $300 for joint filers. To me, it makes sense to send money back to taxpayers since it was your money to begin with.
As soon as the $2.7 billion budget surplus materialized at the end of the last fiscal year, Republican legislative leadersproposed returning a substantial portion to Alabama taxpayers in the form of rebates. I’m glad to see that we followed through. I think the legislative process worked and the taxpayers of Alabama will be getting a good balance of tax cuts and rebates. The rebates will arrive later this year.
The legislature also awarded final passage on Thursday to a pro-life bill that expands Alabama’s “Safe Haven” law by allowing someone to surrender an infant up to 45 days old at hospitals and fire departments across the state. This bill allows for “baby boxes’ which are built into the walls at fire stations and hospitals, so individuals may safely and anonymously leave an infant. Currently an infant can only be surrendered up to 72 hours after birth at a hospital.
Lastly, Gov. Kay Ivey has signed into law the “Alabama Property Protection Act” that seeks to block land acquisitions across the state by the governments of China, Iran, North Korea, and Russia. The new law prohibits “foreign principals of concern” from buying land used for agriculture or forestry or property within 10 miles of a military installation. It also prohibits land purchases near power plants, airports, water treatment plants and other critical infrastructure sites. This bill is similar to the “Not One more Inch or Acre Act” currently being sponsored by Senator Katie Britt.
The legislative session will officially wrap up this week. I’m sure there will be a flurry of last minute activity. I’ll keep you posted…
Representative Matt Woods represents Alabama State House District 13, which covers parts of Walker County. You can contact him at [email protected].
