Glitch doubles grocery taxes on receipts.
Alabama Shoppers Overcharged for Groceries After Sales Tax Reduction
The state of Alabama recently implemented a sales tax rate reduction, but some shoppers were surprised to find that their grocery bills actually increased instead of decreasing.
Effective September 1, the sales tax on food was reduced from 4 percent to 3 percent.
However, due to an error at Walmart and Sam’s Club locations across the state, some customers were charged both the old and new rates, resulting in an effective tax rate of 7 percent instead of the intended 3 percent.
“Earlier today, some Walmart customers and Sam’s Club members across Alabama were incorrectly overcharged sales tax while shopping with us,” a statement from Walmart Media Relations provided to WHNT in Huntsville said.
“Effective Sept. 1, the sales tax rate on food decreased by one percentage point statewide. Our systems mistakenly charged both the old rate and the new rate at the time of sale.”
Walmart urged affected customers to review their receipts and visit their stores to rectify the issue.
“We’re asking customers who used cash while shopping with us today to check their receipts,” Walmart said. “If they see they’ve been charged two separate sales tax amounts, bring that receipt to their Walmart store or Sam’s Club and speak with a member of management to get a refund for the higher of the two taxes.
“Customers who used credit cards and other forms of payment will receive a notification their refunds were automatically applied,” it added.
WHNT, a local news station, confirmed the error by sending a news crew to Walmart and experiencing the same issue with double taxation.
In June, Alabama Governor Kay Ivey signed a bill to reduce the state tax on grocery purchases. The tax may be further reduced if the state’s Education Trust Fund grows by at least 3.5 percent over the prior year, potentially lowering the sales tax on groceries to 2 percent.
“As Alabamians and Americans alike are grappling with tighter times, I am hopeful that this decision by the Legislature to slightly reduce the sales tax on certain food items will be truly felt by Alabama families,” Ivey said in a statement.
The legislation passed unanimously, indicating bipartisan support for reducing or eliminating the grocery tax.
State Rep. Penni McClammy and State Sen. Andrew Jones both expressed their desire to eventually eliminate the grocery tax entirely.
According to estimates, each percentage point reduction in the state tax level could save a family of four approximately $150 annually, although local grocery taxes could offset some of those savings.
It is important for affected shoppers to review their receipts and seek refunds to ensure they are not overpaying for groceries.
Source: The Western Journal
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