SB218 Alabama 2019 Session

Summary

Primary Sponsor

Greg AlbrittonSenator

Republican

Session

Regular Session 2019

Title

Relating to simplified sellers use tax; to modify certain definitions; to clarify when certian taxes can or cannot be remitted; and to provide for adjustments to simplified sellers use tax. Amended code sections: 40-23-191, 40-23-192, 40-23-193, 40-23-195, 40-23-199.2

Summary

SB 218 would rewrite Alabama's simplified sellers use tax to clarify eligible transactions, create a one-time combined rate using state and averaged local rates, and add a local rate adjustment to better match overall taxes.

What This Bill Does

It defines who is eligible to participate in the simplified sellers use tax program and which sales qualify. It establishes an initial 8% simplified use tax for eligible sales, with monthly reporting and record-keeping, and bans local audits of participating sellers for these taxes. It also creates a mechanism to calculate a combined state and local rate using state, county, and municipal averages, and adds a local rate adjustment (capped at one percentage point over the simplified rate) to approximate the full tax burden, with funds distributed to localities.*

Who It Affects

• Eligible sellers participating in the Simplified Sellers Use Tax Remittance Program, who would collect, report, and remit an 8% simplified tax on eligible sales and maintain required records; they could be removed for noncompliance and would be shielded from local audits for these taxes.
• Marketplace facilitators and marketplace sellers, who would be regulated under the marketplace facilitator provisions, must collect/remit the simplified sellers use tax on Alabama sales and provide required notices and records; they receive certain protections and amnesty for prior participation; they are subject to compliance and penalties rules.
• Purchasers in Alabama, who would pay the simplified sellers use tax on eligible purchases, with exemptions allowed when valid exemption documents are provided; the tax collected may be adjusted by local rate changes as defined by the bill.
• Local governments (counties and municipalities), which would receive distributions from the local rate adjustment designed to approximate the combined state/local rate and could gain revenue from the local rate adjustment under the bill.
• The Alabama Department of Revenue, which would administer the program, process applications, collect/remit taxes, set rules, and enforce penalties.

Key Provisions

• Redefines eligible seller, eligible sale, and locality terms, and clarifies when simplified sellers use tax can or cannot be remitted and when state/local taxes must be remitted.
• Establishes the Simplified Sellers Use Tax Remittance Program, under which eligible sellers collect and remit an eight percent simplified use tax on eligible sales shipped into Alabama; the department provides an online system for reporting and remittance.
• Requires eligible sellers to apply, certify eligibility, commit to reporting/remitting for all eligible sales, and maintain purchase records; noncompliance can lead to removal from the program and penalties.
• Marketplace facilitators must register or report sales for the simplified sellers use tax on Alabama retail sales through their platforms; provides for records, notices, discounts, and amnesty protections tied to eligibility.
• Section 2 requires the department to calculate a combined rate as the sum of state, county, and municipal average rates by December 31, 2019, rounded to the nearest percent.
• Effective October 1, 2020, a local rate adjustment (up to the excess of the combined rate over the simplified rate) would be collected and remitted by SSUT participants on all eligible sales, with proceeds distributed to localities per law, and within a cap of one percentage point above the simplified rate.
• Repeals Section 40-23-190 and sets an effective date of October 1, 2019 for the act to take effect.

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

Subjects

Sales and Use Tax