MONTGOMERY — Republicans in the Alabama House on Wednesday gave an alternative proposal to a bill they have rejected three times to remove the state's 4 percent sales tax from groceries.
Members of the House Republican Caucus proposed the bill by Rep. DuWayne Bridges that would provide a grocery tax credit to families living below the federal poverty level.
The refundable income tax rebate would be $75 per person or $300 for a family of four in households with adjusted gross incomes of less than $15,000 a year. The rebate would be $65 per person or $260 for a family of four with incomes between $15,000 and $22,000.
House Minority Leader Mike Hubbard of Auburn said Republicans expect to file the bill Thursday.
Bridges, a Republican from Valley, called his bill "a reasonable alternative" to one proposed by Democrats that would remove the state sales tax from groceries and make up for the lost revenue by taking away the tax deduction for federal income taxes paid by some higher income taxpayers.
Republicans said their plan would cost from $15 million to $20 million a year while removing the sales tax from food would cost an estimated $400 million a year.
"This reasonable alternative to the Democrats' plan is affordable," Bridges said. "It does not demand new broad-based taxes on Alabama's families or small businesses."
"The idea is to reimburse low income people for the taxes they pay on groceries," Hubbard said.
The bill to remove the sales tax from groceries has appeared on the House work agenda three times this session, never receiving the number of votes necessary to bring it up for debate. Each time Republicans voted as a block to prevent consideration of the bill, a constitutional amendment that would have to be approved by voters.
House Majority Leader Rep. Ken Guin, D-Carbon Hill, called the Republican proposal "a smoke screen."
"The tax credit doesn't work. If you are making that low of an income, you are already on food stamps. What we are trying to do is provide a middle class tax cut for those who are working," Guin said.
The proposal to remove the sales tax from groceries is supported by Alabama Arise, an advocacy group that represents low income residents. The group's executive director, Kimble Forrister, said he favors the Democratic plan over the proposed tax credit because it would help more people, including those with middle incomes.
Republicans did not immediately offer a way to fund their plan. Hubbard said Republicans are willing to talk with Democrats and others to come up with a funding plan to replace income lost from the tax credit.
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