MONTGOMERY, Ala. — A multi-year effort to eliminate Alabama’s state sales tax on baby care, feminine hygiene and maternity products is expected to be considered in a Senate committee next week, coming off of a strong bipartisan showing last Thursday after passing unanimously in the House.
That effort has materialized as House Bill 152, carried by Rep. Neil Rafferty, D-Birmingham, who had introduced the measure in two previous legislative sessions; once in 2022, and again in 2024.
“I think it’s important to a lot of folks my age and younger because for me, many of my peers aren’t able to find financial stability enough to have families,” Rafferty said, speaking to Alabama Daily News this week.
“They want to have families, but they also want to be prepared and be able to provide for them. When you have a child, particularly if you’re not making a ton of money, every little penny counts, and this is just a way to get money back into the pockets of these working families.”
Today, Alabama imposes a 4% sales tax on most items, including baby and women’s products. Combined with sales taxes issued by local counties and municipalities, Alabamians can be on the hook for as much as 11% sales tax on baby formula and wipes, diapers, maternity clothes and breast pumps and menstrual products, among others .
Under HB152, however, not only would the state sales tax on baby and women’s products be completely eliminated, but local municipalities would be given authority to reduce or eliminate their own sales tax on said products through a resolution or ordinance.
Coming out of the House, the bill was expanded to include adult diapers through an amendment introduced by Rep. Ginny Shaver, R-Leesburg, and ultimately saw 11 House members – four Republicans and seven Democrats – sign on as cosponsors.
Among those cosponsors was Rep. Susan DuBose, R-Hoover, who told ADN Tuesday that she had long been a supporter of Rafferty’s efforts and considered most opportunities to give tax relief to Alabamians worthy of working across the aisle.
“We want to help young families and our seniors, and this bill covers both those areas,” DuBose told ADN. “Really, these products are necessities that are not inexpensive, and I think it’s important to try to help considering the inflation we’ve had lately. If we can cut taxes where we can to help families, seniors and women, then I’m in favor of it.”
A fiscal note attached to the bill suggests the annual cost to the state to be around $10.5 million, to come out of the state’s Education Trust Fund budget, and that it could result in a cumulative loss of $14.4 million annually in tax revenue for local municipalities if they all exempted the items.
While HB152 is a comparatively a moderate cost to the state, the House recently advanced a four-bill tax cut package totaling $192 million, and House Minority Leader Anthony Daniels, D-Huntsville, had recently filed a bill to extend the state income tax exemption on overtime pay, which was estimated to cost the state around $230 million over nine months.
A number of lawmakers, however, say they’re not overly concerned with the fiscal note for HB152, including Rep. Danny Garrett, R-Trussville, who affirmed his support for the proposal with ADN Tuesday. DuBose also cast fiscal concerns aside regarding the bill, telling ADN lawmakers have taken the bill into account when advancing the other, more costly tax cut bills.
And Sen. Arthur Orr, who not only sponsored the bill in the Senate, but chairs the Senate education committee, called the proposed tax cut “logical.”
“To me, it comes down to two things; one, Alabama wants to support families with small children with tax policies that recognize the cost of rearing children,” Orr, R-Decatur, told ADN Tuesday. “And two, why should 50% of the population have to pay a tax for hygienic products that the other half doesn’t have to purchase? So, it seems like a logical exemption.”