Tax revenues flowing into Alabama state government returned to a more normal rate of growth in 2025, after several years of unusually high gains. Revenue flowing into both the General Fund and the Education Trust Fund grew at about the rate of inflation.

A combination of unusual conditions, including historically low unemployment and an unprecedented level of Covid-relief and economic stimulus sent to the state by the federal government, produced large surges in collections. Inflation, wage growth, and high interest rates on state deposits have continued to keep revenue growth elevated, but are expected to continue to taper in FY 2026.

PARCA’s report Alabama State Tax Collections, 2025: Increases, Decreases and Trends in the Revenues Supporting the State Government provides a full exploration of 2025 tax collections, the factors that drove those collections, and what current trends indicate for the future. You can also explore an interactive version of the data in the visualization below.

Click the link above for the full report, or view below.