By Paul DeMarco
So this last week one of the headlines from Governor Kay Ivey’s State of the State speech was a surprise announcement that she is asking the Alabama Legislature give a one time rebate of $400 to each taxpayer or $800 for each family. The $1 billion request relies on the large surpluses the state has due to the good economic times the Alabama is enjoying now. Lawmakers will debate whether to rubber stamp the Governor’s proposal or go a different direction.
Paul DeMarco
While some other states have also approved rebates, our neighbors are moving forward with permanent tax cuts. Let’s start with Arkansas, where Governor Sarah Huckabee has made it a goal to remove the state income tax. This session the Arkansas Legislature just passed a bill to ban local income taxes to prohibit municipalities and counties from enacting such a tax when the state completely bans the tax. Governor Huckabee has a plan to phase out the income tax in her state, while reducing state expenditures and expanding economic growth.
Meanwhile in Mississippi, Governor Tate Reeves is himself looking to eliminate his state income tax. Last year, he signed into law the largest income tax in Mississippi history. Now Tate is on course to work towards killing the tax for good, which would put him in line with the other nine states that do not have an income tax. Even Florida Governor Ron DeSantis, who was the keynote speaker in Hoover for an Alabama Republican Party Dinner last week, reminded the audience that his state does not have an income tax and suggested the same for Alabama. Hopefully, our state leaders were listening, as we could soon be surrounded by four states that have no income tax.
Some Alabama lawmakers are talking about removing or reducing the grocery tax. The state income tax should also be on the table and considered as part of the debate on future tax reform. Alabama leaders have the opportunity now to provide real tax relief that they all promised when they campaigned for office. Let’s see if this session, Alabama state representatives and senators should do just that.
Paul DeMarco is a former member of the Alabama House of Representatives and can be found on Twitter at @Paul_DeMarco
