HB243 Alabama 2025 Session

Summary

Primary Sponsor

Andy WhittRepresentative

Republican

Session

2025 Regular Session

Title

To unabate a portion certain state ad valorem and construction related transaction taxes to deposit into the Alabama Development Fund.

Summary

HB243 would redirect a portion of newly abated state taxes for private use industrial properties into a new Alabama Development Fund starting with abatements granted after June 1, 2026.

What This Bill Does

It unabates 1.0 mill of the state's noneducational ad valorem taxes and 0.75% of the state construction-related taxes on private use industrial property for abatements granted on or after June 1, 2026, directing those amounts to the Alabama Development Fund. The Alabama Development Fund is created and administered by the Department of Commerce to support economic development. The Department of Revenue must share abatement information with the Department of Commerce for planning and evaluation, with taxpayer confidentiality protected. The changes apply only to new abatements after June 1, 2026, and do not affect abatements granted before that date.

Who It Affects

• Businesses or projects receiving abatements after June 1, 2026: a portion of their state taxes that would have been abated will instead be deposited into the Alabama Development Fund.
• State and local government agencies (Department of Revenue, local tax collectors, and the Department of Commerce): they will collect the unabated amounts, share data about abatements, and administer the new fund, with confidentiality protections.

Key Provisions

• 1.0 mill of the state's abated noneducational ad valorem taxes for new abatements (granted after June 1, 2026) shall be unabated; local officials collect this amount and remit it to the State Comptroller for deposit into the Alabama Development Fund.
• Three-quarters of one percent (0.75%) of the state construction-related taxes on private use industrial property shall be unabated; the Department of Revenue collects these funds and deposits them directly into the Alabama Development Fund.
• Abatements granted before June 1, 2026 are not affected; the provisions apply prospectively to new abatements.
• The Department of Revenue must provide the Department of Commerce with copies of abatement applications, resolutions, and agreements; Commerce uses the information for economic development planning and evaluation, with taxpayer confidentiality protected.
• The Alabama Development Fund is created and administered by the Department of Commerce; funds come from taxes under this act, certain appropriations, gifts/grants, and other designated sources, but not from the State General Fund or Education Trust Fund; expenditures require legislative appropriation and must follow budget laws; unspent funds carry forward to the next fiscal year.
• Sections 1-4 become effective June 1, 2026; Section 5 becomes effective October 1, 2025.

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