Some Alabama employees will be able to get a better salary starting in 2024. This is a bill signed into law by Governor Kay Ivey that will benefit hourly employees in the state.We’re talking about new legislation that seeks to exempt some Alabama employees from state income tax overtime pay.
The idea is that these employees have the possibility of being offered tax relief to some extent. Meanwhile, this new policy will come into force from January 1, 2024.
Likewise, the governor of Alabama expressed during the signing of the legislature that the inhabitants of the state have never been afraid of hard work. “When opportunities and sometimes challenges present themselves, the citizens of our state get the job done,” said Kay Ivey.
What repercussions would this law bring?
It would eliminate the state income tax on overtime pay for full-time hourly workers in Alabama. On the other hand, this change would generate the conditions to achieve a 5% increase in salary for a job. This would be where more than 40 hours per week are worked.
In this sense, Anthony Daniels, sponsor of the bill, stated some essential issues.
For example, from a productivity standpoint, it gives workers the opportunity to earn more money without the employer having to give a pay raise.
As expressed by Daniels, the legislation will be in effect until June 2025. In addition, tax relief for Alabama hourly workers would offset, at least in part, the loss of income.
This way, people are likely to spend the extra money they save thanks to the exemption. Additionally, such spending would increase tax revenue at the local and state level.
