STATE OF ALABAMA

Office of the Governor


BOB RILEY
Governor
 

Press Office
 

December 07, 2006

Governor Riley’s Tax Cut Plan Requires Increase in Education Funding

Governor Riley’s proposal to cut income taxes for middle class families protects our schools from proration. Under the Governor’s plan, education funding in Alabama would actually increase. Legislators and special interest lobbyists who argue the Governor’s plan would cut education funding are wrong.

The Governor’s middle class tax cut REQUIRES the state to spend more on education each year in order for the tax cut to go into effect.

Governor Riley’s plan:

Phases in tax relief over five years

Each year’s installment of the tax cut is effective only if revenue into the Education Trust Fund increases by at least 3% that year

So when Governor Riley’s tax cuts are fully implemented, the state will be able to spend at least $1.5 billion more annually on education than it does today. MORE, NOT LESS on education.

Over the last 15 years, annual growth in the ETF has averaged about 5%

The Governor’s plan will provide tax relief to all families with incomes up to $100,000. That means 90% of Alabama families will receive a tax cut.

The Governor’s plan will bring the income tax filing threshold for a family of four up to $15,000 and will allow more for personal exemptions, dependent exemptions, and standard deductions.

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