HB258 Alabama 2024 Session

Summary

Primary Sponsor

Chris EnglandRepresentative

Democrat

Session

Regular Session 2024

Title

Simplified Sellers Use Tax; to levy an additional amount based on current sales tax rates to be distributed to municipalities and counties.

Summary

HB258 would add an extra Simplified Sellers Use Tax in Alabama, directing most proceeds to municipalities and counties, with the rate set by a formula and reviewed every five years, and only taking effect if the related Adventure Awaits sales tax holiday bill is enacted.

What This Bill Does

It creates an additional simplified sellers use tax whose rate is calculated as the state sales tax rate plus the average county and municipal tax rates plus the current simplified sellers use tax rate, and it would be collected like the existing program. Proceeds would be distributed 80% to municipalities and 20% to counties, based on population as shown in the most recent census. The rate would be recalculated before September 1, 2029 and then every five years thereafter. The effective date is September 1, 2024, but only if the Adventure Awaits sales tax holiday bill is enacted.

Who It Affects

• Eligible sellers and marketplace facilitators: would be responsible for collecting and remitting the additional tax on sales into Alabama or sales facilitated by marketplaces.
• Municipalities and counties: would receive the majority of the tax proceeds (80% to municipalities and 20% to counties) distributed based on population estimates from the latest census.

Key Provisions

• Adds Sections 40-23-193.1 and 40-23-197.2 to create an additional simplified sellers use tax and to outline its distribution.
• Calculates the new tax rate as the sum of the general state sales tax rate, the average county general sales tax rate, the average municipal general sales tax rate, and the current simplified sellers use tax rate, rounded to the nearest tenth percent, with rate published by administrative rule.
• Distributes all proceeds from the new tax: 80% to municipalities and 20% to counties, prorated by population based on the most recent federal census.
• Rate is subject to recalculation before September 1, 2029 and every five years after that, with changes taking effect on September 1 of the recalculation year.
• Tax is reported, collected, and administered the same as the existing simplified sellers use tax and becomes effective only if the Adventure Awaits sales tax holiday bill is enacted.

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

Subjects

Taxation & Revenue