AP Survey: Support for repealing Alabama grocery tax

Published 10:59 am Friday, January 23, 2009

An Associated Press survey of Alabama legislators found strong support for removing the state sales tax on groceries, but sharp division over how to do it.

Democrats mostly favor a plan that would wipe out the 4 percent tax that benefits public education and replace the lost revenue by repealing Alabama’s state income tax deduction for federal income taxes paid. That change would cause most higher-income Alabamians to pay more in income taxes than they save in sales taxes.

Republicans and a few Democrats favor a plan that would phase out 1 percent of the sales tax each year in which revenue coming in for public education grows at least 3 percent. That plan wouldn’t kick in until Alabama recovers from the current recession, but it also wouldn’t require anyone to pay higher income taxes.

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The Democrat-backed plan, sponsored by state Rep. John Knight, D-Montgomery, narrowly passed the House last spring, but fell one vote short in the Senate. Since then, Alabama’s economy has changed significantly, with unemployment rising and tax collections dwindling.

Based on AP’s survey, more than 60 percent of House and Senate members responding favor one of the two plans, but neither has enough support to pass going into the legislative session starting Feb. 3.

The plan to wipe out the tax drew support from 31 percent of the House members responding and 30 percent of the senators responding.

The plan to phase out the tax was favored by 32 percent of the House members responding and 40 percent of those in the Senate.

Seventeen percent of those in the House and 13 percent in the Senate didn’t like either plan. Another 20 percent inhe House and 17 percent in the Senate were undecided.

The Associated Press surveys legislators before each year’s regular session. Past surveys have proven a reliable forecast of what will happen in a session. This year’s survey was answered by 70 percent of the House and 94 percent of the Senate.

The sponsor of the Republican-backed plan figures it doesn’t have much chance for two reasons: The Democratic legislative leadership will try to keep it from coming to a vote and the Alabama Education Association is opposed to it because it is not revenue neutral.

“The people who live off state government don’t want to lose one nickel,” said Sen. Scott Beason, R-Gardendale.

The House Democratic Caucus has made Knight’s plan a priority for the upcoming session.

“With the economy declining and the cost of groceries continually on the rise, we must do something to help families make ends meet,” House Majority Leader Ken Guin, D-Carbon Hill, said.

Alabama Arise, a Montgomery-based organization representing the state’s poor, has made repeal of the grocery tax a priority for years. Executive Director Kimble Forrister said he’s hopeful that this will be the year for Knight’s plan, but three Democratic senators who supported it last year are no longer there. One was elected to Congress, one died, and one was convicted. None of the vacant seats will likely be filled before the legislative session ends in mid-May.

“The Senate with the Democratic numbers will be the challenge,” Forrister said.

Veteran state Sen. Charles Bishop, R-Jasper, expects the Legislature to put off a decision until more stable economic times.

“With the state of the economy, it would be dumb to reshuffle taxes right now,” he said.