SB321 Alabama 2022 Session

Updated Feb 26, 2026

Notable

Summary

Primary Sponsor: Donnie ChesteenSenator
Republican
Session: Regular Session 2022
Title: Municipal business license, rental and leasing services, not required to obtain a business license in each municipality in which its equipment is rented or leased
Summary: SB321 lets municipalities require a delivery license for businesses that deliver rental or sold merchandise into a municipality but have no other physical presence there.
What This Bill Does
It amends Section 11-51-194 to allow a municipality to require a fixed-rate delivery license (up to $100) for delivering merchandise into the municipality by the business or its employees or contractors, including rental items. The license is limited by gross receipts into the municipality, not to exceed $75,000 in a license year (and this cap can be increased to as much as $150,000 every five years by ordinance). Common carriers cannot obtain the license, but if a business uses its own non-common-carrier delivery vehicles, those deliveries count toward the cap. The license fee is calculated in arrears based on the prior year's receipts, and there are exemptions and penalties for noncompliance.

Who It Affects
Businesses that deliver rental or sold merchandise into a municipality but have no other physical presence there and may be subject to a delivery license.
Small businesses with very low local receipts or no local presence may be exempt from licensing, while other businesses must choose either a delivery license or a regular business license; municipalities also gain authority to set fees, decals, and penalties.

Key Provisions
A municipality may require a fixed-rate delivery license for delivering merchandise into the municipality by the taxpayer's employees or agents when there is no other physical presence in the municipality.
Delivery license fee cannot exceed $100; municipalities may require a decal for each delivery vehicle, with decal cost limited to the municipality's actual cost.
An issuance fee of up to $10 may be charged for a delivery license.
License year limit: gross receipts from sales and delivery into the municipality cannot exceed $75,000; the cap can be increased every five years to up to $150,000 by ordinance.
Common carriers are not eligible for the delivery license; if a taxpayer also uses delivery vehicles other than a common carrier, those receipts count toward the $75,000 cap.
Taxpayers with gross receipts inside the municipality of $10,000 or less and no other physical presence may be exempt from licensing; otherwise they must purchase either a delivery license or a regular business license.
Delivery license fees are calculated in arrears based on the prior year's receipts.
Purchasing a delivery license or exemption does not establish tax nexus (nor does it negate existing nexus).
If a taxpayer fails to meet criteria during the license year, they must obtain the appropriate license within 45 days or face a penalty not to exceed $10.
Effective date: the act takes effect immediately after governor's approval.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Business Licenses