HB173 Alabama 2022 Session

Summary

Primary Sponsor

Mike Holmes

Republican

Session

Regular Session 2022

Title

Sales and use tax on food, exemption established, income tax deduction, deduction based on federal income tax paid, limit established, const. amend.

Summary

HB173 would exempt food from Alabama's state sales and use taxes and cap federal income tax deductions for individuals through a constitutional amendment.

What This Bill Does

If passed, it would start exempting gross receipts from the sale or use of food from state sales and use taxes beginning January 1, 2023, while local food taxes would stay at the current local rate. It would also amend Amendment 225 to cap federal income tax deductions for individuals at $4,000 for single, head of household, and married filing separately filers, and $8,000 for married filing jointly, for tax years after 2022; nonresident deductions would be limited to federal tax paid or accrued on income from sources within Alabama. The changes would require voter approval in a statewide election to take effect.

Who It Affects

• Individual income taxpayers in Alabama, who would have a capped federal income tax deduction (up to $4,000 for most filing statuses or up to $8,000 for married filing jointly).
• Consumers who buy food in Alabama, who would no longer pay state sales tax on food (local taxes on food would continue to be collected at the current local rates).

Key Provisions

• Food would be exempt from state sales and use taxes beginning January 1, 2023; local governments would continue to collect their share of sales tax on food.
• Definition of FOOD aligns with the federal SNAP program definition; if SNAP changes, the Legislature would define food by general law.
• For tax years after 2022, individuals filing as single, head of household, or married filing separately cannot deduct more than $4,000 of federal income tax paid or accrued; those filing jointly cannot deduct more than $8,000.
• Nonresident individual taxpayers could deduct only the portion of federal income tax paid or accrued on income sourced within Alabama.
• The amendments would be proposed as constitutional amendments and would take effect only if approved by a majority of voters in a statewide election.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Constitutional Amendments