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State Sen. Orr supports some tax cuts, tax rebate: ‘I think we can do both’

This year, State Sen. Arthur Orr (R-Decatur) called for tax rebates for Alabamians in response to the record amount of tax revenue the state received in fiscal year 2022.

Recently Gov. Kay Ivey expressed support for “some form of rebates,” but warned against “permanent structural change” to state budgeting.

Thursday on WVNN’s “The Yaffee Program,” Orr discussed what he believes tax relief would look like for taxpayers in the Yellowhammer State.

“We’ve got to marry, in my opinion, with [tax rebates] some permanent tax cuts as well,” Orr said. “So I don’t think tax rebates are exclusive. I think we can do both. I think we can continue to help our retirees, those with 401ks, defined contribution type plans, the IRAs, if they pull money out that we give them some kind of tax relief.

“And I think we can also look at our tax brackets and look at some tax relief down to the first couple thousand dollars that people make.”

He also explained how much money Alabama taxpayers could see in the form of a rebate if it passed.

“We’re in safe territory with thinking for an individual $150 to $200, somewhere in that range,” Orr said, “and married filed jointly or a married couple looking at $200 to $400, maybe more, but that’s very preliminary.”

But Orr warned against a temptation to cut taxes too much, which could result in shortfalls taking place in future budgets.

“People have to understand this is a one-time deal,” he said. “If you give away the farm or have permanent tax cuts, and then revenue reverts to the mean, and we think it will or may even be worse that that, it may go back to a situation where revenue is less because of the economy, inflation, being in recession, then we could be in a world of hurt.”

Orr said any permanent tax cuts must be accomplished in a reasonable way.

“I don’t disagree with tax cuts,” he said, “but I think we need to keep chipping away, but we need to be very thoughtful about it, very prudent about it, because we don’t want to over estimate and then we wind up in a downward economy, recession and having to really cripple education in the state, which I would argue all day long is the future of our state.”

Yaffee is a contributing writer to Yellowhammer News and hosts “The Yaffee Program” weekdays 9-11 a.m. on WVNN. You can follow him on Twitter @Yaffee

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