News from the Tennessee Valley State, Local and National news

State cigarette taxes beat property in General Fund

By M.J. Ellington · (334) 262-1104

MONTGOMERY — Alabama cigarette tax revenue is down because people are smoking less.

While less smoke may be good for public health, the amount of tax revenue that Alabamians generate for the General Fund budget when they light up is decreasing. It is still more, however, than General Fund revenue from property taxes.

Rep. John Knight, longtime House General Fund budget chairman, observed the fact at a legislative orientation session on state revenue. Knight, D-Montgomery, made the point even as state lawmakers mulled the likelihood that they will face legislation to eliminate yearly property tax re-appraisals when they convene in March.

Norris Green, the Senate fiscal officer at the Legislative Reference Service, said last week that in the 2006 fiscal year that ended Sept. 30 the state got $148.7 million in cigarette tax. Of that amount, $127.4 million went to the General Fund. From each pack of 20 cigarettes, the state gets 42.5 cents in tax.

Property taxes brought in a total of $285 million to the state in 2006, with $109.5 million going to the General Fund, Green said. Public K-12 schools, which get a much higher percentage of property taxes than the General Fund, received $132 million from that source in 2006.

Green said every public school in the state receives funds through revenue generated from the state’s portion of a property owner’s taxes. By law, the state can levy only 6.5 mills of property tax. Most property taxes stay with cities and counties where the property is located, Green added.

Save $84.50 a year off our newsstand price:
Subscribe today for only 38 cents a day!

Leave feedback
on this or

Email This Page