Much of the conversation leading into this year’s legislative session centered on the expected budget surplus and the possibility of either cutting taxes or the state issuing a rebate back to taxpayers. This week the House and Senate really began to debate the different options and which path to take.
In the House, Republicans are evaluating the state budget and considering options ranging from
the elimination of the state grocery tax to rebates for taxpayers. The state has an opportunity to make significant long-term tax cuts and I’m excited we are making moves to return the taxpayers’ money through these various plans.
On Thursday, the House approved legislation that will cut income taxes for earners at both ends of the economic spectrum. The bill would eliminate the current 2% tax that people pay on the first $500 of taxable income for single people and $1,000 for married couples who file their taxes together. The bill would also reduce the 5.0% state income tax rate to 4.95% in 2027, on taxable income over $3,000 for single people and $6,000 for married taxpayers.
Governor Ivey has also put forward a package of economic incentives that are about to be debated. Nicknamed “The Game Plan,” the package of bills would renew and, in some cases, expand tax incentive programs that are set to expire soon. One of her bills is focused on helping Alabama compete with neighboring states that are also investing millions of dollars to recruit new companies.
A recent study identified the need to increase the number of megasites in Alabama to lure more industry and create additional jobs for our state. Currently, the state has a historically low number of sites that are sufficient for industry development. Additional investment is needed across Alabama to continue to compete for companies willing to locate to and expand here.
Previous incentive programs have been highly successful for Alabama and have been great investments that have brought high rates of return in capital investment, new jobs, and overall growth of the tax base. I believe the bills in Governor Ivey’s “Game Plan” package will be similarly beneficial for Alabama. I look forward to supporting them.
Although it did not get much attention, the House also passed another bill related to adoptions that supplemented the pro-life, pro-adoption bills from last week. This week’s bill will allow public education employees to use paid sick leave to care for their adopted children or children who are in the process of being adopted. State law currently allows education employees to utilize sick leave while caring for a parent, spouse, sibling, or biological child, but adopted children are not included. This bill, if it becomes law, will be very helpful for adoptive families and families going through the adoption process.
As always, it’s a privilege to serve the people of Walker County.
Representative Matt Woods represents Alabama State House District 13, which covers parts of Walker County. You can contact him at email@example.com.