House Bill 531 Alabama 2026 Session

Summary

Primary Sponsor

Ed OliverRepresentative

Republican

Session

2026 Regular Session

Title

Taxation; to exempt certain contractors from utility gross receipts tax, utility service use tax, and sales and use tax on natural gas and liquefied petroleum gas.

Summary

HB531 would exempt natural gas and liquefied petroleum gas used by licensed contractors on public highway, road, or bridge construction from certain taxes and allow local governments to offer similar exemptions, effective September 1, 2026.

What This Bill Does

If enacted, the bill removes state and certain utility taxes on natural gas and LPG purchased for use as fuel or energy by qualified contractors on public highway/road/bridge construction projects. It also authorizes counties and municipalities to adopt comparable local exemptions. Eligibility for the exemption is limited to contractors licensed by the State Licensing Board for General Contractors (or their subcontractors) under a written contract with a governmental entity.

Who It Affects

• Licensed general contractors and their subcontractors working on public highway, road, or bridge construction projects in Alabama, for purchases of natural gas or LPG used as fuel or energy.
• Counties and municipalities, which may adopt complimentary local sales and use tax exemptions under the bill's framework.

Key Provisions

• Excludes the furnishing of natural gas or LPG for use or consumption as fuel or energy in constructing public highways, roads, or bridges from utility gross receipts tax and utility service use tax, with eligibility limited to licensed contractors or their subcontractors under a government contract.
• Exempts the purchase of natural gas and LPG for use in such construction from state sales and use taxes, with eligibility limited to licensed contractors or their subcontractors under a government contract.
• Allows counties and municipalities to adopt local sales and use tax exemptions for these products under similar conditions.
• Effective date: September 1, 2026.

AI-generated summary using openai/gpt-5-nano on Feb 26, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation & Revenue