SB48INTRODUCED
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XQIJZE-1
By Senators Orr, Bell, Butler, Carnley, Sessions, Waggoner,
Hovey, Weaver, Reed, Scofield, Barfoot, Price, Williams,
Roberts, Elliott, Kelley, Allen, Givhan, Chambliss, Albritton,
Stutts, Singleton, Melson, Coleman-Madison
RFD: Finance and Taxation Education
First Read: 07-Mar-23
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8 XQIJZE-1 02/28/2023 KHF (F)KHF 2023-561
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SYNOPSIS:
Under existing law, Alabama levies an individual
income tax at rates ranging from two percent on taxable
income to a top rate of five percent on taxable income.
This bill would phase in a reduction in the top
tax rate from five percent to four and ninety-five
hundredths percent.
A BILL
TO BE ENTITLED
AN ACT
Relating to individual income taxes; to amend Section
40-18-5, Code of Alabama 1975, to phase-in a reduction in the
top tax rate from five percent to four and ninety-five
hundredths percent.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Section 40-18-5, Code of Alabama 1975, is
amended to read as follows:
"ยง40-18-5
The tax levied and imposed by Section 40-18-2 shall be
computed as follows:
(1) For a single person, head of family, or married
persons filing separate returns:
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a. Two percent of taxable income not in excess of five
hundred dollars ($500).
b. Four percent of taxable income in excess of five
hundred dollars ($500) and not in excess of three thousand
dollars ($3,000).
c. Five percent of For taxable income in excess of
three thousand dollars ($3,000) :.
1. Five percent through tax year 2022.
2. Four and ninety-nine hundredths percent for tax year
2023.
3. Four and ninety-eight hundredths percent for tax
year 2024.
4. Four and ninety-seven hundredths percent for tax
year 2025.
5. Four and ninety-six hundredths percent for tax year
2026.
6. Four and ninety-five hundredths percent for tax year
2027 and each tax year thereafter.
(2) For married persons filing a joint return:
a. Two percent of taxable income not in excess of one
thousand dollars ($1,000).
b. Four percent of taxable income in excess of one
thousand dollars ($1,000) and not in excess of six thousand
dollars ($6,000).
c. Five percent of For taxable income in excess of six
thousand dollars ($6,000) :.
1. Five percent through tax year 2022.
2. Four and ninety-nine hundredths percent for tax year
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2023.
3. Four and ninety-eight hundredths percent for tax
year 2024.
4. Four and ninety-seven hundredths percent for tax
year 2025.
5. Four and ninety-six hundredths percent for tax year
2026.
6. Four and ninety-five hundredths percent for tax year
2027 and each tax year thereafter.
Section 2. This act shall become effective on the first
day of the third month following its passage and approval by
the Governor, or its otherwise becoming law.
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