House Bill 145 Alabama 2026 Session

Summary

Primary Sponsor

Paul W. LeeRepresentative

Republican

Session

2026 Regular Session

Title

Taxation; tobacco interstate warehouser permits required, penalties imposed for violations

Summary

HB145 creates an interstate tobacco warehouser permit system in Alabama to regulate certain tobacco distributors, with licensing, reporting, and enforcement provisions.

What This Bill Does

Defines an interstate warehouser and requires a Department of Revenue–issued permit for entities that purchase tobacco directly from manufacturers and sell to Alabama wholesale dealers. Establishes a detailed permit application process (40-25-15.1) with required documents, including licenses from at least four other states, financial statements, and contracts with Alabama wholesalers; sets an initial $2,000 permit fee and a $500 annual renewal, with the permit non-transferable and revocation possible for violations. Requires monthly reporting of activity by interstate warehousers and other tobacco distributors (40-25-16.1), allows inspections of records (40-25-11), and creates penalties for noncompliance, including confiscation of contraband and potential fines or license withdrawal. Tightens enforcement of stamp requirements and contraband controls (40-25-8, 40-25-8.1, 40-25-25), including penalties for failing to stamp products, transporting without proper permits, and possessing unstamped items, with additional per-violation penalties and possible license revocation for repeat offenses. Permits limited manufacturer stamping for specific purposes (40-25-4.1) with advance notice to the state and local governments, and directs the Department to keep a public listing of permitted entities.

Who It Affects

• Interstate warehousers, wholesalers, jobbers, semijobbers, retailers, importers, and distributors of tobacco who operate in Alabama; they must obtain a permit, maintain records, report monthly activity, and could face penalties or permit revocation for noncompliance.
• Alabama's Department of Revenue, as well as counties, municipalities, and law enforcement; they administer the permit system, publish the permitted entities, conduct inspections, enforce stamping and reporting requirements, and impose penalties.

Key Provisions

• Interstate warehouser is defined as a person who buys tobacco directly from the manufacturer or its affiliate and sells to a permitted wholesale dealer for resale in Alabama.
• A new interstate warehouser permit is required to ship tobacco into Alabama; the annual application must include copies of out-of-state licenses, a Certificate of Authority if not AL-registered, lists of Alabama wholesale customers, contract copies, audited financial statements, and a $2,000 initial permit fee.
• Annual permit renewal is $500 due by October 1 each year; failure to renewal constitutes voluntary dismissal of the permit; fees may be used by the Department for enforcement; permits are non-transferable and non-refundable.
• The Department may deny, revoke, or condition a permit for fraud, prior revocation, tax nonpayment, or other good cause; violations may lead to revocation for up to one year.
• Monthly reporting requirement (first through the twentieth day each month) of activity by permittees, including customer information and product details; a public website will list qualified entities.
• Penalties for violations include per-violation fines (with escalating penalties for repeated offenses), enforcement actions for untaxed or unstamped products, and confiscation of contraband; significant penalties apply for violations related to permits and stamping.
• Manufacturers may, under limited circumstances, affix revenue stamps for promotions or test-marketing with at least four weeks’ notice to the Department; the Department will notify local governments of the exception details.
• Effective date: October 1, 2026.

AI-generated summary using openai/gpt-5-nano on Feb 11, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation & Revenue