105651-1:n:01/08/2009:LFO/KB/kp
| SYNOPSIS: | Currently, federal income taxes, standard deductions, personal exemptions, and dependent exemptions are deductible from gross income prior to computation of Alabama income tax liability. |
| Also, the state levies sales taxes upon the sale of food items. | |
| This bill would propose an amendment to the Constitution of Alabama of 1901, to eliminate the deductibility of federal income taxes from Alabama gross income for individual taxpayers; to increase individual income tax standard deductions, personal exemptions, and dependent exemptions; and to remove the state sales tax on food items. |
To propose an amendment to the Constitution of Alabama of 1901, to eliminate the state income tax deduction for federal income taxes for individual taxpayers; to increase individual income tax standard deductions, personal exemptions, and dependent exemptions; and to eliminate the state sales tax on food.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. The following amendment to the Constitution of Alabama of 1901, as amended, is proposed and shall become valid as a part thereof when approved by a majority of the qualified electors voting thereon and in accordance with Sections 284, 285, and 287 of the Constitution of Alabama of 1901, as amended:PROPOSED AMENDMENT
(a) Amendment 225 of the Constitution of Alabama of 1901, now appearing as Section 211.04 of the Official Recompilation of the Constitution of Alabama of 1901, is repealed.
(b) Effective for all tax years beginning after December 31, 2010, federal income taxes shall no longer be allowed to be deducted in computing income subject to the state individual income tax.
(c) Effective for all tax years beginning after December 31, 2010, the optional standard deduction allowed to individual income taxpayers shall be equal to the amount allowed for federal income tax purposes pursuant to 26 U.S.C. §63.
(d) Effective for all tax years beginning after December 31, 2010, the personal exemption allowed for each individual income taxpayer shall be not less than $2,200. The personal exemption allowed for married taxpayers filing jointly shall be not less than $4,400.
(e) Effective for all tax years beginning after December 31, 2010, the exemption allowed for each dependent of an individual income taxpayer shall be not less than $2,200.
(f) Beginning January 1, 2011, the sale of food shall be exempt from state sales tax. The sale of food to corporations, S corporations, and limited liability entities, as defined in Section 40-14A-1 shall not be exempt from state sales tax. Local governments shall continue to levy sales taxes on food at the same rate collected for the local portion of the retail sales tax. For purposes of this amendment, food means food as defined for food stamp purposes in the Federal Food Stamp Act, 7 U.S.C. §2011, et seq.
Section 2. An election upon the proposed amendment shall be held in accordance with Sections 284 and 285 of the Constitution of Alabama of 1901, as amended, and the election laws of this state.
Section 3. The appropriate election official shall assign a ballot number for the proposed constitutional amendment on the election ballot and shall set forth the following description of the substance or subject matter of the proposed constitutional amendment:
"Proposing an amendment to the Constitution of Alabama of 1901, the "Tax Fairness Amendment of 2009," which would remove the four percent state sales tax on food, increase income tax standard deductions, personal exemptions, and dependent exemptions, and remove the individual income tax deduction for federal income taxes paid or accrued.
"Proposed by Act ________."
This description shall be followed by the following language:
"Yes ( ) No ( )."