SB209 Alabama 2025 Session

Summary

Primary Sponsor

Kirk HatcherSenator

Democrat

Session

2025 Regular Session

Title

Taxation; to adjust the dollar value cap based on Consumer Price Index, of certain items exempt from sales tax during certain weekends

Summary

SB209 would tie the price caps for items exempt from Alabama sales tax during sales-tax holidays to CPI changes and require longer advance notice for local governments to grant exemptions.

What This Bill Does

The bill requires the Department of Revenue to adjust the dollar value caps for covered items based on changes in the Consumer Price Index, starting with 2026 and then every five years. It defines a broad set of covered items with specific price caps (e.g., clothing up to $100 per article; computers and related school items up to $750 per item; school supplies up to $50 per item; school books up to $30 per book; and other items such as batteries, radios, tarps, and more up to $60 per item, plus portable generators and power cords up to $1,000). It also lets counties and municipalities exempt these covered items from local sales taxes during designated holiday weekends, but with extended advance notice requirements and only during those designated holidays, not at other times. The act takes effect October 1, 2025.

Who It Affects

• Consumers in Alabama who purchase covered items during sales-tax holidays, as the eligible items and price caps may change with CPI
• Local governments (counties and municipalities) that may designate exemptions for covered items from local sales taxes during certain weekends, under new lead-time rules

Key Provisions

• Defines 'covered items' and sets price caps, including clothing up to $100 per article; computers/computer software/school computer supplies up to $750 per item; school supplies up to $50 per item; school books up to $30 per book; and a list of other items (batteries, radios, tarpaulins, duct tape, plywood, can openers, fuel tanks, etc.) up to $60 per item; portable generators and power cords up to $1,000
• Requires the Department of Revenue to adjust these dollar amounts using CPI changes from December 2006 to December 2024, with adjustments for calendar year 2026 and every five years thereafter, rounded to the nearest dollar
• Allows counties and municipalities to exempt covered items from local sales and use taxes during designated holiday weekends by resolution or ordinance, with a lead-time of at least 3090 days before the third full weekend of July (for the July weekend) and explicit conditions that exemptions apply only during those holidays
• Conforms local exemption timing to the state holiday framework by referencing the same terms and prohibitions against exemptions outside designated holiday periods
• Effective date: 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