HB43 Alabama 2015 1st Special Session

Summary

Primary Sponsor

Bill Poole

Republican

Session

First Special Session 2015

Title

Use tax, revenue redistributed, portions earmarked for various agencies, Secs. 40-23-61, 40-23-85, 40-23-174 am'd.

Summary

HB43 would change how Alabama distributes use tax revenue, directing funds to the Education Trust Fund, General Fund, and many state agencies, and laying out rules for future remote-seller tax proceeds.

What This Bill Does

The bill amends key sections to specify how use tax money is split between the Education Trust Fund and the General Fund, including separate rules for remote use taxes. It creates mandatory annual allocations to numerous state agencies and programs as a first priority before other distributions, and requires funding for the Children's Health Insurance Program. It also outlines how remote-seller tax proceeds would be shared if a nationwide collection agreement is reached, including distributions to municipalities and counties. The changes would take effect October 1, 2016, and the act retains severability and repeals conflicting laws.

Who It Affects

• Education Trust Fund (receives a larger share of use tax revenue under the new distribution rules, including 58% of the 2% use tax and a portion of remote use tax proceeds).
• General Fund (receives a larger share of use tax revenue under the new distribution rules, including 42% of the 2% use tax and a portion of remote use tax proceeds).
• State agencies and programs named in the bill (Public Health, Higher Education, Mental Health, Rehabilitation Services, Youth Services, Archives and History, Legislative offices, etc.) that would receive specific annual appropriations as a first charge before other distributions.
• Municipalities and counties (potential recipients under remote-seller tax scenarios, receiving portions of proceeds as specified).
• Taxpayers and businesses paying use tax (impacted by the new allocation rules and potentially by how remote sale taxes are collected and distributed).

Key Provisions

• Amends 40-23-61 to allocate 58% of the 2% use tax to the Education Trust Fund and 42% to the General Fund; adds rules for remote use tax distributions (75% to General Fund and 25% to EFT) and for remaining amounts (75% to EFT and 25% to General Fund).
• Amends 40-23-85 to require use tax money collected to be paid to the Department of Revenue, with a first-charge allocation to fund various agencies and programs (as listed) and to fund CHIP; after these charges, the balance of use tax proceeds is distributed with 75% to the General Fund and 25% to the EFT, plus specified annual allocations to numerous agencies and programs.
• Amends 40-23-174 to establish distribution rules for remote-seller tax proceeds if a national agreement is adopted: half of such proceeds go to Alabama, with 75% of that half to the General Fund and 25% to the EFT; one-quarter to the municipality where delivery occurs; the remainder to the county where delivery occurs; funds are to be spent like other sales/use tax proceeds.
• Creates a general severability clause and repeals conflicting laws; provides an effective date of October 1, 2016.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation