HB191 Alabama 2025 Session

Updated Feb 22, 2026

Summary

Primary Sponsor: Alan BakerRepresentative
Republican
Session: 2025 Regular Session
Title: Relating to Sales and Use Tax; to establish conditions for exemption of county or municipal sales and use tax
Summary: HB191 sets strict rules for counties and municipalities to grant exemptions from local sales and use taxes, tying exemptions to local resolutions, notice, and specific start dates.
What This Bill Does
It requires local exemptions to be adopted by resolution or ordinance that includes an effective date (September 1) and a defined duration; it requires notice to the Alabama Department of Revenue by July 1 before the exemption starts; it allows rescission under similar notice rules; it also ends pre-existing local exemptions that don't meet these requirements by September 1, 2025, and the Department will publish a listing of exemptions and may issue administrative rules.

Who It Affects
County and municipal governments must follow new rules to create or rescind local tax exemptions (resolution/ordinance, timing, and reporting).
Residents and businesses in counties/municipalities with local sales taxes will be affected by which exemptions exist, as determined by local actions and the published list.

Key Provisions
Local exemptions from county or municipal sales and use taxes must be enacted via a county/municipal resolution or ordinance and include the exemption provisions.
Exemption resolutions/ordinances must specify an effective date of September 1 and a duration in either fiscal-year increments or in perpetuity.
The county/municipality must notify the Alabama Department of Revenue by July 1, prior to the exemption's effective date.
Exemptions may be rescinded by resolution or ordinance with an effective date of September 1 of a fiscal year, with notice to the Department by July 1 prior to that date.
Exemptions adopted under pre-existing general laws must comply with these requirements or cease to be effective beginning September 1, 2025.
The Department of Revenue will publish a listing of exemptions and may adopt rules to administer the section, and the act does not modify the process for issuing state-level exemption certificates.

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