Rep. Danny Garrett (R-Trussville) has introduced four new tax cut bills aimed at providing further financial relief to Alabama families.
“While I am proud that Alabama’s taxes are consistently among the lowest in the nation, there are still commonsense, conservative measures we can take to put more money back into the pockets of hardworking Alabamians,” said Rep. Garrett. “These bills will lower grocery bills, reduce taxes on withdrawals from defined contribution retirement plans, and increase the standard deduction on state income taxes. Additionally, we will remove the restriction from the Grocery Tax Cut that prevents counties and municipalities from reducing their local grocery taxes.”
“Including the previous cut in the grocery tax, these tax cuts will save Alabama families approximately $314.6 million per year,” he added.
House Speaker Nathaniel Ledbetter (R-Rainsville) praised the Legislature’s continued efforts to provide tax relief while maintaining the state’s strong financial standing.
“The Legislature has passed over a dozen tax cuts since 2022, saving Alabama families thousands of dollars each year,” said Speaker Ledbetter. “We’ve done this while paying off the state’s debt, fully funding reserve accounts, issuing $393 million in tax rebates, and cutting government waste. Alabama’s financial footing has never been stronger, and I’m proud that our responsible budgeting has allowed us to provide even more relief to our citizens.”
The proposed tax cut bills include:
HB386 – Accelerates the Grocery Tax Cut by an additional 1%, bringing the total reduction to 2% since 2023. This would result in an additional estimated $123 million in annual savings for Alabama families. At 2%, the Grocery Tax Cut amounts to a $246 million tax cut.
HB387 – Removes the provision that currently prevents local governments from reducing their grocery tax.
HB388 – Doubles the state’s tax exemption for withdrawals from defined contribution retirement plans, increasing it from $6,000 to $12,000. HB388 amounts to a $44.8 million tax cut.
HB389 – Increases the income floor and the amount of the optional standard deduction and increases the income threshold for the maximum dependent exemption, further reducing the state income tax burdens for Alabamians. HB389 amounts to $23.8 million tax cut.
These measures build on the Republican-led Legislature’s ongoing commitment to fiscal responsibility and taxpayer relief, ensuring Alabama families continue to benefit from a thriving and well-managed economy.
