SB130 Alabama 2016 Session

Summary

Primary Sponsor

Paul Sanford

Republican

Session

Regular Session 2016

Title

Use tax, revenue redistributed to State General Fund, Secs. 27-4A-3, 40-23-61, 40-23-85, 40-23-174 am'd.

Summary

SB130 reallocates use tax and insurance premium tax revenues between Alabama's General Fund and the Education Trust Fund, prioritizes CHIP, and takes effect Oct 1, 2016 without counting these changes toward the ETF cap for FY2017.

What This Bill Does

It changes how premium taxes are distributed among the General Fund, Education Trust Fund, and the Alabama Special Mental Health Trust Fund. It changes how remote use tax proceeds are split, directing 75% of remote use tax amounts to the General Fund and 25% to the ETF, with the remaining use tax amounts split 53% to the General Fund and 47% to the ETF. It designates an amount sufficient to fund CHIP as a first charge against General Fund allocations. It also sets the effective date and notes these changes will not affect the ETF appropriation cap for FY2017.

Who It Affects

• Insurance companies: premium tax distributions to the General Fund and the Education Trust Fund would change, potentially affecting where their tax revenues go; the bill preserves existing premium tax credits such as the Alabama Insurance Offices Facilities Credit and the Alabama Real Property Investment Credit.
• Municipalities and counties: portions of remote use tax proceeds would be allocated to local governments (municipalities and counties) where deliveries occur, potentially increasing local tax distributions.

Key Provisions

• Amends sections related to the premium tax (27-4A-3) and use tax distributions to specify new allocation between the General Fund and Education Trust Fund, and to the Alabama Special Mental Health Trust Fund.
• Specifies remote use tax proceeds: 75% to the General Fund and 25% to the Education Trust Fund; the remaining use tax proceeds are distributed 53% to the General Fund and 47% to the Education Trust Fund.
• Remits an amount sufficient to fund the Children's Health Insurance Program (CHIP) as a first charge against General Fund allocations.
• Allocates a share of use tax (including automobiles) to defined funds per section 40-23-61 and related sections, with remittance rules outlined in 40-23-85.
• Provides that these distribution changes shall not be counted toward the Education Trust Fund appropriation cap for the fiscal year ending September 30, 2017.
• Effective date: 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