HB269 Alabama 2024 Session

Summary

Primary Sponsor

Brock ColvinRepresentative

Republican

Session

Regular Session 2024

Title

Taxation; exemption for certain air carriers

Summary

HB269 expands and clarifies Alabama tax exemptions for aircraft sales and leases by removing the hub requirement and adding new domicile rules for aircraft not permanently domiciled in Alabama, with exemptions sunsetting in 2029.

What This Bill Does

The bill removes the requirement that air carriers must have a hub operation in Alabama to qualify for exemptions on the sale and lease of aircraft and replacement parts. It allows aircraft manufactured or delivered in Alabama to be exempt from sales and use taxes even if the aircraft is not permanently domiciled in Alabama, using new criteria to determine domicile. It also exempts gross receipts from leasing aircraft not domiciled in Alabama, subject to similar domicile rules and with local (county/municipal) tax exemption approvals required. All changes take effect September 1, 2024 and exemptions are set to expire September 30, 2029.

Who It Affects

• Air carriers, aircraft manufacturers/sellers, leasing companies, and buyers/lessees of aircraft and replacement parts: gain expanded tax exemptions for sales and leases, and clearer rules on when an aircraft is considered domiciled in Alabama.
• Counties and municipalities in Alabama: exemptions may not apply to local county or municipal taxes unless a local governing body approves the exemption, potentially affecting local tax revenues.

Key Provisions

• Amends Section 40-23-4 to remove the Alabama hub operation requirement for air-carrier aircraft and parts sales/uses tax exemptions, and defines a hub with criteria (origin of many flights, multiple destinations, frequent passenger or cargo interchange).
• Adds an exemption for the gross receipts from the sale of aircraft manufactured, sold, and delivered in Alabama if the aircraft are not permanently domiciled in Alabama and are removed to another state, with domicile determined by specific tests (e.g., base outside Alabama, purchaser HQ outside Alabama, and operation by eligible carriers).
• Adds an exemption for the gross receipts from the lease of aircraft not domiciled in Alabama, with similar domicile criteria and a requirement for local approval for county/municipal taxes; includes sunset and effectiveness details.
• Exemption expiration dates: the new aircraft-related exemptions expire September 30, 2029; effectively begin September 1, 2024.
• Defines domicile-related terms and the conditions under which an aircraft is considered not permanently domiciled in Alabama, including operations by certified/foreign carriers and certain logistical criteria.

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