Alabama House Passes Tax Bill

By: Associated Press
By: Associated Press

The Alabama House passed a bill Friday that raises about $479 million a year in tax revenue by increasing income taxes on upper income Alabama residents and corporations, while easing the burden on the poor.

The income tax is the largest part of Gov. Bob Riley's plan to raise $1.2 billion in new tax revenue. The bill, which now goes to the Senate, passed the House 63 to 37.

After taking the income tax vote, House members began debating the other major plank of Riley's tax package, a bill to raise property taxes on many state landowners and homeowners.

The income tax bill raises the threshold where low-income residents must begin paying taxes and gives a tax break or leaves taxes the same for most poor and middle-income taxpayers.

The current five percent tax rate will go up to six percent for individual taxpayers making more than $75,000 and for taxpayers filing joint returns making more than $150,000.

Not all legislators were happy with the idea of raising taxes. Mobile Rep. James Buskey said Alabama taxpayers should be allowed to quote "tar and feather us.''

A new poll finds many Alabama voters want the state's budget shortfall fixed, but few agree on which taxes should be used to do it. The poll, conducted by the Alabama Education Association's in-house polling firm, was conducted during the first week of the special session.

Poll Director, Gerald Johnson, said the poll found 62 percent of the voters satisfied with Gov. Riley's job performance, 28 percent dissatisfied and 10 percent were undecided.

When asked how they feel about the governor's plan, 38 percent said the state definitely needs it, 27 percent said the state may need it. Ten percent said the state may not or definitely does not need the plan. Another 15 percent said the state needs to live with the money, 11 percent were unsure.

When asked about specific taxes in Riley's plan, 57 percent said they would vote for a hike in the state cigarette tax.

Among the most unpopular items were the big ticket proposals in the package, including increased property taxes and eliminating the state income tax deduction for federal taxes paid.

Riley's plan had more support among Republicans than Democrats and more support among whites than blacks. Riley's weakest support is among black females.

The random telephone poll involved 593 register voters and has a sampling error margin of plus or minus four percentage points.


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