HB4 Alabama 2026 Session

Summary

Primary Sponsor

Jamie KielRepresentative

Republican

Session

2026 Regular Session

Title

Taxation; establishes Alabama Broadband Investment Maximization Act; exempts ADECA project funded or administered purchases from sales and use tax

Summary

HB4 would create the Alabama Broadband Investment Maximization Act, offering a limited state sales and use tax exemption for purchases of broadband equipment and supplies on ADECA-funded or administered projects.

What This Bill Does

It exempts the gross receipts from the sale of equipment and infrastructure used to provide broadband services or internet access from state sales and use taxes, for projects funded or administered by ADECA, with a minimum useful life of ten years. The bill explains what counts as broadband equipment, broadband services, and internet access, and it excludes the retail sale of personal consumer electronics from the exemption. The exemption would run from September 1, 2026, through August 31, 2029, becomes effective June 1, 2026, and can be implemented via rules from the Department of Revenue; counties and municipalities may also exempt local taxes for these purchases.

Who It Affects

• Vendors and suppliers selling eligible broadband equipment and supplies for ADECA-funded or administered projects, who would benefit from the state sales and use tax exemption on those purchases.
• Counties and municipalities that choose to exempt the gross proceeds from these sales from local sales and use taxes under the act.

Key Provisions

• Exemption from state sales and use tax on gross receipts from the sale of equipment, machinery, software, ancillary components, and other infrastructure with a useful life of at least ten years used to produce broadband services or internet access.
• Exemption applies only to purchases made for projects funded or administered by the Alabama Department of Economic and Community Affairs (ADECA).
• The Department of Revenue may adopt rules to implement and administer the exemption.
• Exemption does not apply to the retail sale of personal consumer electronics (e.g., smartphones, computers, tablets, modems, routers).
• Definitions for broadband services, equipment, and internet access are provided, including examples of eligible equipment and services.
• Counties or municipalities may exempt the gross proceeds from the sale of broadband equipment and supplies from local taxes.
• The exemption is available from September 1, 2026, to August 31, 2029.
• The act becomes effective on June 1, 2026.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation & Revenue