Alabama Tax Policy & Rates 2026
Income tax, sales tax, property tax, and overall tax burden for Alabama in 2026, with political context.
No
No Income Tax
5.0%
Income Tax Rate
#42
Tax Burden Rank (1=highest)
#49
Property Tax Rank (1=highest)
Tax Policy Overview
Alabama has relatively low taxes overall, with a low property tax rate (among the lowest nationally) and a modest income tax. Sales tax can be high when local rates are added. The state taxes groceries, which is unusual and regressive. Alabama has low overall tax burden, ranking 42nd nationally.
Key Tax Rates
| Tax Type | Rate / Status |
|---|---|
| Income Tax | 5.0% |
| No Income Tax | No |
| Sales Tax | 4.0% (+local up to 11%) |
| No Sales Tax | No |
| Corporate Tax | 6.5% |
| Property Tax Rank | #49 nationally (1=highest) |
| Overall Tax Burden Rank | #42 nationally (1=highest) |
Political Context
Alabama Republicans have cut taxes repeatedly. A major political issue has been the grocery tax, which Democrats have pushed to eliminate or reduce as a regressive burden on low-income families. Republicans have resisted full elimination while offering limited exemptions.