Ivey signs grocery tax reduction into law
MONTGOMERY, Ala. (AP) — Alabama Gov. Kay Ivey on Thursday signed legislation to reduce Alabama’s sales tax on groceries.
The tax cut will reduce the state’s 4% tax on groceries to 3% on Sept. 1. The tax will drop to 2% on Sept. 1, 2024, but only if tax collections to the Education Trust Fund rise at least 3.5% to offset the loss. If that growth requirement isn’t met, the tax would be reduced to 2% in the next year that the growth requirement is satisfied.
“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,” Ivey said in a statement.
Alabama is one of only three states that tax groceries at the same rate as other purchases. Advocates had long argued that taxing food at such a rate placed an unfair burden on families in the poor Southern state, where 16% of the people live in poverty and the median household income hovers around $54,000.
Some lawmakers had tried unsuccessfully for decades to remove the tax. The measure gained broad bipartisan support this year against a backdrop of soaring food prices and a hefty state budget surplus.
“This is welcome news for Alabamians who are struggling to make ends meet and working hard to keep food on the table. And this is meaningful progress toward a more just and equitable tax system for our state,” Chris Sanders, a spokesman for Alabama Arise, an advocacy group for low-income families.
Sanders said the “state grocery tax is a cruel tax on survival.” He said Alabama Arise remains committed to the goal of eliminating it entirely.
Legislative efforts to remove the full 4% tax faltered because of concerns about the loss of funding to the state education budget and a lack of political will to raise other taxes to offset the loss. The current 4% tax provides more than $600 million annually to the state for its Education Trust Fund, which currently totals a little more than $8 billion.
Lawmakers are creating a study commission to explore the possibility of eventually removing all of the tax.
Despite the pause on high tariffs, Chinese factories still face high uncertainty
A 90-day pause on triple-digit U.S. tariffs on Chinese goods has left exporters and importers in a high state of uncertainty. Factory owners in China tell NPR that orders are down overall.
RFK Jr. says COVID shots no longer recommended for kids, pregnant women
Health Secretary Robert F Kennedy Jr. announced that CDC recommendations for COVID vaccines will no longer include healthy pregnant women and healthy children.
Trump administration moves to cancel remaining federal funds to Harvard
A letter from the U.S. General Services Administration, which is dated Tuesday, tells agencies to submit a list of contracts they have terminated with the university by June 6.
NPR and Colorado public radio stations sue Trump White House
NPR and three Colorado public radio stations are suing the Trump administration over the president's executive order seeking to ban the use of federal money for NPR and PBS.
Alabama study reveals hurricane resilience programs are paying off for homeowners and insurers
The first-of-its-kind analysis, released last week, reviews thousands of insurance claims linked to Hurricane Sally, which struck Alabama’s coast in 2020. Homes retrofitted or built to Fortified standards saw significantly fewer and less costly claims.
Are manufacturing jobs actually special?
More than half of American workers don't have a college degree. Is manufacturing a ticket for them to the middle class?
