Grocery taxes in Alabama are now set to be reduced, a move that Alabama Arise, a advocacy group, is applauding.
In a significant move, Alabama is set to lower its state sales tax on groceries from 3% to 2%, effective from Monday, September 1. This reduction marks the second time the state has reduced its grocery tax since 2023.
Governor Kay Ivey, who signed House Bill 386 into law in May, stated that this reduction will make it easier for every Alabamian to make ends meet, especially in times of high food prices. The bill grants county and municipalities more flexibility in lowering local grocery taxes.
Robyn Hyden, the executive director of Alabama Arise, a nonprofit focused on addressing poverty in Alabama, celebrated the reduction while pushing for the complete elimination of Alabama's grocery tax. Arise has been advocating for this change for decades. The organisation appreciates the unanimous legislative support on HB386 during the 2025 Legislative Session.
Alabama Arise is open to numerous ideas for replacement revenue and will continue working with the state's Joint Study Commission on Grocery Taxation to find a path forward. Hyden suggests replacing grocery tax revenue by capping or ending the state income tax deduction for federal income tax payments. This would place less of a burden on lower and middle-income Alabamians.
Hyden expressed gratitude to Rep. Danny Garrett, Sens. Andrew Jones and Arthur Orr, and Gov. Kay Ivey for passing and signing HB386 into law. Hyden also encouraged lawmakers to consider alternative revenue streams that would further the goal of eliminating Alabama's grocery tax entirely.
It is worth noting that Alabama is one of only 10 states that still tax groceries. Closing this skewed loophole would protect funding for public schools and ensure Alabama can afford to end the state sales tax on groceries forever.
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This reduction is a step towards tax justice in Alabama, as highlighted by Hyden, who considered the reduction from 4% to 3% in 2023 as an essential first step. Hyden is committed to the goal of eliminating Alabama's grocery tax entirely, ensuring a brighter future for the state's residents.
