Sales tax
The state's general sales tax rate is 4%. Sales tax rates for cities and counties are also added to purchases. For example, the total sales tax rate in Mobile is 10% and there is an additional restaurant tax of 1%, which means a diner in Mobile would pay an 11% tax on a meal. , sales and excise taxes in Alabama account for 51% of all state and local revenue, compared with an average of about 36% nationwide. Alabama is one of seven states that levy a tax on food at the same rate as other goods, and one of two states (the other being neighboring Mississippi) which fully taxes groceries without any offsetting relief for low-income families. (Most states exempt groceries from sales tax or apply a lower tax rate.)