Alabama grocery tax reduction underway, state leaders have more work ahead 

The Alabama grocery tax was reduced from 4 cents to 3 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 towards the ultimate removal of the tax on groceries. 

In addition, another penny will go away in 2024 if state education revenues grow by 3.5%. 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 2 cents as well. 

Yet, some cities in Alabama tax groceries as well, 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 last year, from 4 cents to 2 cents. 

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.