Alabama 2023 Regular Session

Alabama House Bill HB438 Compare Versions

Only one version of the bill is available at this time.

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1	1	HB438INTRODUCED
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3	3	OZSBJW-1
4	4	By Representatives Rafferty, Hollis, Daniels, England, Hall,
5	5	Wood (D), Wilcox, Givan, Morris, Hulsey, McClammy, Clarke,
6	6	Holk-Jones
7	7	RFD: Ways and Means Education
8	8	First Read: 04-May-23
9	9	2023 Regular Session
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17	17	8 OZSBJW-1 03/20/2023 TEW (F)TEW 2023-1052
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19	19	SYNOPSIS:
20	20	Under existing law, there are a variety of
21	21	exemptions and exclusions applicable to state sales and
22	22	use tax.
23	23	This bill would exempt the purchase of diapers,
24	24	menstrual hygiene products, or both for personal use
25	25	from sales and use tax.
26	26	A BILL
27	27	TO BE ENTITLED
28	28	AN ACT
29	29	To amend Section 40-23-4, as last amended by Act
30	30	2022-291, Act 2022-293, Act 2022-373, and Act 2022-199, Code
31	31	of Alabama 1975, relating to sales tax exemptions; to provide
32	32	for a sales and use tax exemption for certain purchases of
33	33	diapers; to provide for a sales and use tax exemption for
34	34	certain purchases of menstrual hygiene products; to provide
35	35	for definitions; and to provide for rulemaking authority.
36	36	BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
37	37	Section 1. Section 40-23-4, as last amended by Act
38	38	2022-291, Act 2022-293, Act 2022-373, and Act 2022-199, Code
39	39	of Alabama 1975, is amended to read as follows:
40	40	"§40-23-4
41	41	(a) There are exempted from the provisions of this
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71	71	division and from the computation of the amount of the tax
72	72	levied, assessed, or payable under this division the
73	73	following:
74	74	(1) The gross proceeds of the sales of lubricating oil
75	75	and gasoline as defined in Sections 40-17-30 and 40-17-170 and
76	76	the gross proceeds from those sales of lubricating oil
77	77	destined for out-of-state use which are transacted in a manner
78	78	whereby an out-of-state purchaser takes delivery of such oil
79	79	at a distributor's plant within this state and transports it
80	80	out-of-state, which are otherwise taxed.
81	81	(2) The gross proceeds of the sale, or sales, of
82	82	fertilizer when used for agricultural purposes. The word
83	83	"fertilizer" shall not be construed to include cottonseed
84	84	meal, when not in combination with other materials.
85	85	(3) The gross proceeds of the sale, or sales, of seeds
86	86	for planting purposes and baby chicks and poults. Nothing
87	87	herein shall be construed to exempt or exclude from the
88	88	computation of the tax levied, assessed, or payable, the gross
89	89	proceeds of the sale or sales of plants, seedlings, nursery
90	90	stock, or floral products.
91	91	(4) The gross proceeds of sales of insecticides and
92	92	fungicides when used for agricultural purposes or when used by
93	93	persons properly permitted by the Department of Agriculture
94	94	and Industries or any applicable local or state governmental
95	95	authority for structural pest control work and feed for
96	96	livestock and poultry, but not including prepared food for
97	97	dogs and cats.
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127	127	(5) The gross proceeds of sales of all livestock by
128	128	whomsoever sold, and also the gross proceeds of poultry and
129	129	other products of the farm, dairy, grove, or garden, when in
130	130	the original state of production or condition of preparation
131	131	for sale, when such sale or sales are made by the producer or
132	132	members of the producer's immediate family or for the producer
133	133	by those employed by the producer to assist in the production
134	134	thereof. Nothing herein shall be construed to exempt or
135	135	exclude from the measure or computation of the tax levied,
136	136	assessed, or payable hereunder, the gross proceeds of sales of
137	137	poultry or poultry products when not products of the farm.
138	138	(6) Cottonseed meal exchanged for cottonseed at or by
139	139	cotton gins.
140	140	(7) The gross receipts from the business on which, or
141	141	for engaging in which, a license or privilege tax is levied by
142	142	or under Sections 40-21-50, 40-21-53, and 40-21-56 through
143	143	40-21-60; provided, that nothing contained in this subdivision
144	144	shall be construed to exempt or relieve the person or persons
145	145	operating the business enumerated in these sections from the
146	146	payments of the tax levied by this division upon or measured
147	147	by the gross proceeds of sales of any tangible personal
148	148	property, except gas and water, the gross receipts from the
149	149	sale of which are the measure of the tax levied by Section
150	150	40-21-50, merchandise or other tangible commodities sold at
151	151	retail by the persons, unless the gross proceeds of sale
152	152	thereof are otherwise specifically exempted by this division.
153	153	(8) The gross proceeds of sales or gross receipts of or
154	154	by any person, firm, or corporation, from the sale of
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184	184	transportation, gas, water, or electricity, of the kinds and
185	185	natures, the rates and charges for which, when sold by public
186	186	utilities, are customarily fixed and determined by the Public
187	187	Service Commission of Alabama or like regulatory bodies.
188	188	(9) The gross proceeds of the sale, or sales of wood
189	189	residue, coal, or coke to manufacturers, electric power
190	190	companies, and transportation companies for use or consumption
191	191	in the production of by-products, or the generation of heat or
192	192	power used in manufacturing tangible personal property for
193	193	sale, for the generation of electric power or energy for use
194	194	in manufacturing tangible personal property for sale or for
195	195	resale, or for the generation of motive power for
196	196	transportation.
197	197	(10) The gross proceeds from the sale or sales of fuel
198	198	and supplies for use or consumption aboard ships, vessels,
199	199	towing vessels, or barges, or drilling ships, rigs or barges,
200	200	or seismic or geophysical vessels, or other watercraft (herein
201	201	for purposes of this exemption being referred to as "vessels")
202	202	engaged in foreign or international commerce or in interstate
203	203	commerce; provided, that nothing in this division shall be
204	204	construed to exempt or exclude from the measure of the tax
205	205	herein levied the gross proceeds of sale or sales of material
206	206	and supplies to any person for use in fulfilling a contract
207	207	for the painting, repair, or reconditioning of vessels,
208	208	barges, ships, other watercraft, and commercial fishing
209	209	vessels of over five tons load displacement as registered with
210	210	the U.S. Coast Guard and licensed by the State of Alabama
211	211	Department of Conservation and Natural Resources.
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241	241	For purposes of this subdivision, it shall be presumed
242	242	that vessels engaged in the transportation of cargo between
243	243	ports in the State of Alabama and ports in foreign countries
244	244	or possessions or territories of the United States or between
245	245	ports in the State of Alabama and ports in other states are
246	246	engaged in foreign or international commerce or interstate
247	247	commerce, as the case may be. For the purposes of this
248	248	subdivision, the engaging in foreign or international commerce
249	249	or interstate commerce shall not require that the vessel
250	250	involved deliver cargo to or receive cargo from a port in the
251	251	State of Alabama. For purposes of this subdivision, vessels
252	252	carrying passengers for hire, and no cargo, between ports in
253	253	the State of Alabama and ports in foreign countries or
254	254	possessions or territories of the United States or between
255	255	ports in the State of Alabama and ports in other states shall
256	256	be engaged in foreign or international commerce or interstate
257	257	commerce, as the case may be, if, and only if, both of the
258	258	following conditions are met: (i) The vessel in question is a
259	259	vessel of at least 100 gross tons; and (ii) the vessel in
260	260	question has an unexpired certificate of inspection issued by
261	261	the United States Coast Guard or by the proper authority of a
262	262	foreign country for a foreign vessel, which certificate is
263	263	recognized as acceptable under the laws of the United States.
264	264	Vessels that are engaged in foreign or international commerce
265	265	or interstate commerce shall be deemed for the purposes of
266	266	this subdivision to remain in such commerce while awaiting or
267	267	under repair in a port of the State of Alabama if the vessel
268	268	returns after such repairs are completed to engaging in
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298	298	foreign or international commerce or interstate commerce. For
299	299	purposes of this subdivision, seismic or geophysical vessels
300	300	which are engaged either in seismic or geophysical tests or
301	301	evaluations exclusively in offshore federal waters or in
302	302	traveling to or from conducting such tests or evaluations
303	303	shall be deemed to be engaged in international or foreign
304	304	commerce. For purposes of this subdivision, proof that fuel
305	305	and supplies purchased are for use or consumption aboard
306	306	vessels engaged in foreign or international commerce or in
307	307	interstate commerce may be accomplished by the merchant or
308	308	seller securing the duly signed certificate of the vessel
309	309	owner, operator, or captain or such person's respective agent,
310	310	on a form prescribed by the department, that the fuel and
311	311	supplies purchased are for use or consumption aboard vessels
312	312	engaged in foreign or international commerce or in interstate
313	313	commerce. Any person filing a false certificate shall be
314	314	guilty of a misdemeanor and upon conviction shall be fined not
315	315	less than twenty-five dollars ($25) nor more than five hundred
316	316	dollars ($500) for each offense. Each false certificate filed
317	317	shall constitute a separate offense. Any person filing a false
318	318	certificate shall be liable to the department for all taxes
319	319	imposed by this division upon the merchant or seller, together
320	320	with any interest or penalties thereon, by reason of the sale
321	321	or sales of fuel and supplies applicable to the false
322	322	certificate. If a merchant or seller of fuel and supplies
323	323	secures the certificate herein mentioned, properly completed,
324	324	the merchant or seller shall not be liable for the taxes
325	325	imposed by this division, if the merchant or seller had no
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355	355	knowledge that the certificate was false when it was filed
356	356	with the merchant or seller.
357	357	(11) The gross proceeds of sales of tangible personal
358	358	property to the State of Alabama, to the counties within the
359	359	state and to incorporated municipalities of the State of
360	360	Alabama.
361	361	(12) The gross proceeds of the sale or sales of
362	362	railroad cars, vessels, barges, and commercial fishing vessels
363	363	of over five tons load displacement as registered with the
364	364	U.S. Coast Guard and licensed by the State of Alabama
365	365	Department of Conservation and Natural Resources, when sold by
366	366	the manufacturers or builders thereof.
367	367	(13) The gross proceeds of the sale or sales of
368	368	materials, equipment, and machinery that, at any time, enter
369	369	into and become a component part of ships, vessels, towing
370	370	vessels or barges, or drilling ships, rigs or barges, or
371	371	seismic or geophysical vessels, other watercraft and
372	372	commercial fishing vessels of over five tons load displacement
373	373	as registered with the U.S. Coast Guard and licensed by the
374	374	State of Alabama Department of Conservation and Natural
375	375	Resources. Additionally, the gross proceeds from the sale or
376	376	sales of lifeboats, personal flotation devices, ring life
377	377	buoys, survival craft equipment, distress signals, EPIRB's,
378	378	fire extinguishers, injury placards, waste management plans
379	379	and logs, marine sanitation devices, navigation rulebooks,
380	380	navigation lights, sound signals, navigation day shapes, oil
381	381	placard cards, garbage placards, FCC SSL, stability
382	382	instructions, first aid equipment, compasses, anchor and radar
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412	412	reflectors, general alarm systems, bilge pumps, piping, and
413	413	discharge and electronic position fixing devices which are
414	414	used on the aforementioned watercraft.
415	415	(14) The gross proceeds of the sale or sales of fuel
416	416	oil purchased as fuel for kiln use in manufacturing
417	417	establishments.
418	418	(15) The gross proceeds of the sale or sales of
419	419	tangible personal property to county and city school boards
420	420	within the State of Alabama, independent school boards within
421	421	the State of Alabama, all educational institutions and
422	422	agencies of the State of Alabama, the counties within the
423	423	state, or any incorporated municipalities of the State of
424	424	Alabama, and private educational institutions operating within
425	425	the State of Alabama offering conventional and traditional
426	426	courses of study, such as those offered by public schools,
427	427	colleges, or universities within the State of Alabama; but not
428	428	including nurseries, day care centers, and home schools.
429	429	(16) The gross proceeds from the sale of all devices or
430	430	facilities, and all identifiable components thereof, or
431	431	materials for use therein, acquired primarily for the control,
432	432	reduction, or elimination of air or water pollution and the
433	433	gross proceeds from the sale of all identifiable components
434	434	of, or materials used or intended for use in, structures built
435	435	primarily for the control, reduction, or elimination of air
436	436	and water pollution.
437	437	(17) The gross proceeds of sales of tangible personal
438	438	property or the gross receipts of any business which the state
439	439	is prohibited from taxing under the Constitution or laws of
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469	469	the United States or under the Constitution of this state.
470	470	(18) When dealers or distributors use parts taken from
471	471	stocks owned by them in making repairs without charge for the
472	472	parts to the owner of the property repaired pursuant to
473	473	warranty agreements entered into by manufacturers, such use
474	474	shall not constitute taxable sales to the manufacturers,
475	475	distributors, or to the dealers, under this division or under
476	476	any county sales tax law.
477	477	(19) The gross proceeds received from the sale or
478	478	furnishing of food, including potato chips, candy, fruit and
479	479	similar items, soft drinks, tobacco products, and stationery
480	480	and other similar or related articles by hospital canteens
481	481	operated by Alabama state hospitals at Bryce Hospital and
482	482	Partlow State School for Mental Deficients at Tuscaloosa,
483	483	Alabama, and Searcy Hospital at Mt. Vernon, Alabama, for the
484	484	benefit of the patients therein.
485	485	(20) The gross proceeds of the sale, or sales, of
486	486	wrapping paper and other wrapping materials when used in
487	487	preparing poultry or poultry products for delivery, shipment,
488	488	or sale by the producer, processor, packer, or seller of such
489	489	poultry or poultry products, including pallets used in
490	490	shipping poultry and egg products, paper or other materials
491	491	used for lining boxes or other containers in which poultry or
492	492	poultry products are packed together with any other materials
493	493	placed in such containers for the delivery, shipment, or sale
494	494	of poultry or poultry products.
495	495	(21) The gross proceeds of the sales of all
496	496	antibiotics, hormones and hormone preparations, drugs,
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526	526	medicines or medications, vitamins, minerals or other
527	527	nutrients, and all other feed ingredients including
528	528	concentrates, supplements, and other feed ingredients when
529	529	such substances are used as ingredients in mixing and
530	530	preparing feed for fish raised to be sold on a commercial
531	531	basis, livestock, and poultry. Such exemption herein granted
532	532	shall be in addition to exemptions now provided by law for
533	533	feed for fish raised to be sold on a commercial basis,
534	534	livestock, and poultry, but not including prepared foods for
535	535	dogs or cats.
536	536	(22) The gross proceeds of the sale, or sales, of
537	537	seedlings, plants, shoots, and slips which are to be used for
538	538	planting vegetable gardens or truck farms and other
539	539	agricultural purposes. Nothing herein shall be construed to
540	540	exempt, or exclude from the computation of the tax levied,
541	541	assessed, or payable, the gross proceeds of the sale, or the
542	542	use of plants, seedlings, shoots, slips, nursery stock, and
543	543	floral products, except as hereinabove exempted.
544	544	(23) The gross proceeds of the sale, or sales, of
545	545	fabricated steel tube sections, when produced and fabricated
546	546	in this state by any person, firm, or corporation for any
547	547	vehicular tunnel for highway vehicular traffic, when sold by
548	548	the manufacturer or fabricator thereof, and also the gross
549	549	proceeds of the sale, or sales, of steel which enters into and
550	550	becomes a component part of such fabricated steel tube
551	551	sections of said tunnel.
552	552	(24) The gross proceeds from sales of admissions to any
553	553	theatrical production, symphonic or other orchestral concert,
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583	583	ballet, or opera production when the concert or production is
584	584	presented by any society, association, guild, or workshop
585	585	group, organized within this state, whose members or some of
586	586	whose members regularly and actively participate in the
587	587	concerts or productions for the purposes of providing a
588	588	creative outlet for the cultural and educational interests of
589	589	its members, and of promoting such interests for the
590	590	betterment of the community by presenting the productions to
591	591	the general public for an admission charge. The employment of
592	592	a paid director or conductor to assist in any such
593	593	presentation described in this subdivision shall not be
594	594	construed to prohibit the exemptions herein provided.
595	595	(25) The gross proceeds of sales of "herbicides" for
596	596	agricultural uses by whomsoever sold. The term herbicides, as
597	597	used in this subdivision, means any substance or mixture of
598	598	substances intended to prevent, destroy, repel, or retard the
599	599	growth of weeds or plants. The term includes preemergence
600	600	herbicides, postemergence herbicides, lay-by herbicides,
601	601	pasture herbicides, defoliant herbicides, and desiccant
602	602	herbicides.
603	603	(26) The Alabama Chapter of the Cystic Fibrosis
604	604	Research Foundation and the Jefferson Tuberculosis Sanatorium
605	605	and any of their departments or agencies, heretofore or
606	606	hereafter organized and existing in good faith in the State of
607	607	Alabama for purposes other than for pecuniary gain and not for
608	608	individual profit, shall be exempted from the computation of
609	609	the tax on the gross proceeds of all sales levied, assessed,
610	610	or payable.
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640	640	(27) The gross proceeds from the sale or sales of fuel
641	641	for use or consumption aboard commercial fishing vessels are
642	642	exempt from the computation of all sales taxes levied,
643	643	assessed, or payable under this division or levied under any
644	644	county or municipal sales tax law.
645	645	(28) The gross proceeds from the sales of rope, fishing
646	646	nets, tools, or any substitute used directly in the process of
647	647	commercial fishing by a holder of a commercial license issued
648	648	pursuant to Chapter 12 of Title 9.
649	649	(29) The gross proceeds of sales of sawdust, wood
650	650	shavings, wood chips, and other like materials sold for use as
651	651	chicken litter by poultry producers and poultry processors.
652	652	(30) The gross proceeds of the sales of all
653	653	antibiotics, hormones and hormone preparations, drugs,
654	654	medicines, and other medications including serums and
655	655	vaccines, vitamins, minerals, or other nutrients for use in
656	656	the production and growing of fish, livestock, and poultry by
657	657	whomsoever sold. The exemption herein granted shall be in
658	658	addition to the exemption provided by law for feed for fish,
659	659	livestock, and poultry, and in addition to the exemptions
660	660	provided by law for the above-enumerated substances and
661	661	products when mixed and used as ingredients in fish,
662	662	livestock, and poultry feed.
663	663	(31) The gross proceeds of the sale or sales of all
664	664	medicines prescribed by physicians for persons who are 65
665	665	years of age or older, and when the prescriptions are filled
666	666	by licensed pharmacists, shall be exempted under this division
667	667	or under any county or municipal sales tax law. The exemption
668	668	309
669	669	310
670	670	311
671	671	312
672	672	313
673	673	314
674	674	315
675	675	316
676	676	317
677	677	318
678	678	319
679	679	320
680	680	321
681	681	322
682	682	323
683	683	324
684	684	325
685	685	326
686	686	327
687	687	328
688	688	329
689	689	330
690	690	331
691	691	332
692	692	333
693	693	334
694	694	335
695	695	336 HB438 INTRODUCEDHB438 INTRODUCED
696	696	Page 13
697	697	provided in this section shall not apply to any medicine
698	698	purchased in any manner other than as is herein provided.
699	699	For the purposes of this subdivision, proof of age may
700	700	be accomplished by filing with the dispensing pharmacist any
701	701	one or more of the following documents:
702	702	a. The name and claim number as shown on a Medicare
703	703	card issued by the United States Social Security
704	704	Administration.
705	705	b. A certificate executed by any adult person having
706	706	knowledge of the fact that the person for whom the medicine
707	707	was prescribed is not less than 65 years of age.
708	708	c. An affidavit executed by any adult person having
709	709	knowledge of the fact that the person for whom the medicine
710	710	was prescribed is not less than 65 years of age.
711	711	For the purposes of this subdivision, any person filing
712	712	a false proof of age shall be guilty of a misdemeanor and upon
713	713	conviction thereof shall be punished by a fine of one hundred
714	714	dollars ($100).
715	715	(32) There shall be exempted from the tax levied by
716	716	this division the gross receipts of sales of grass sod of all
717	717	kinds and character when in the original state of production
718	718	or condition of preparation for sale, when the sales are made
719	719	by the producer or members of the producer's family or for the
720	720	producer by those employed by the producer to assist in the
721	721	production thereof; provided, that nothing herein shall be
722	722	construed to exempt sales of sod by a person engaged in the
723	723	business of selling plants, seedlings, nursery stock, or
724	724	floral products.
725	725	337
726	726	338
727	727	339
728	728	340
729	729	341
730	730	342
731	731	343
732	732	344
733	733	345
734	734	346
735	735	347
736	736	348
737	737	349
738	738	350
739	739	351
740	740	352
741	741	353
742	742	354
743	743	355
744	744	356
745	745	357
746	746	358
747	747	359
748	748	360
749	749	361
750	750	362
751	751	363
752	752	364 HB438 INTRODUCEDHB438 INTRODUCED
753	753	Page 14
754	754	(33) The gross receipts of sales of the following items
755	755	or materials that are necessary in the farm-to-market
756	756	production of tomatoes when such items or materials are used
757	757	by the producer or members of the producer's family or for the
758	758	producer by those employed by the producer to assist in the
759	759	production thereof: Twine for tying tomatoes, tomato stakes,
760	760	field boxes (wooden boxes used to take tomatoes from the
761	761	fields to shed), and tomato boxes used in shipments to
762	762	customers.
763	763	(34) The gross proceeds from the sale of liquefied
764	764	petroleum gas or natural gas sold to be used for agricultural
765	765	purposes.
766	766	(35) The gross receipts of sales from state nurseries
767	767	of forest tree seedlings.
768	768	(36) The gross receipts of sales of forest tree seed by
769	769	the state.
770	770	(37) The gross receipts of sales of Lespedeza bicolor
771	771	and other species of perennial plant seed and seedlings sold
772	772	for wildlife and game food production purposes by the state.
773	773	(38) The gross receipts of any aircraft manufactured,
774	774	sold, and delivered in this state if the aircraft are not
775	775	permanently domiciled in Alabama and are removed to another
776	776	state.
777	777	(39) The gross proceeds from the sale or sales of all
778	778	diesel fuel used for off-highway agricultural purposes.
779	779	(40) The gross proceeds from sales of admissions to any
780	780	sporting event that:
781	781	a. Takes place in the State of Alabama on or after
782	782	365
783	783	366
784	784	367
785	785	368
786	786	369
787	787	370
788	788	371
789	789	372
790	790	373
791	791	374
792	792	375
793	793	376
794	794	377
795	795	378
796	796	379
797	797	380
798	798	381
799	799	382
800	800	383
801	801	384
802	802	385
803	803	386
804	804	387
805	805	388
806	806	389
807	807	390
808	808	391
809	809	392 HB438 INTRODUCEDHB438 INTRODUCED
810	810	Page 15
811	811	January 1, 1984, regardless of when such sales occur; and
812	812	b. Is hosted by a not-for-profit corporation organized
813	813	and existing under the laws of the State of Alabama; and
814	814	c. Determines a national championship of a national
815	815	organization, including, but not limited to, the Professional
816	816	Golfers Association of America, the Tournament Players
817	817	Association, the United States Golf Association, the United
818	818	States Tennis Association, and the National Collegiate
819	819	Athletic Association; and
820	820	d. Has not been held in the State of Alabama on more
821	821	than one prior occasion, provided, however, that for such
822	822	purpose the Professional Golfers Association Championship, the
823	823	United States Open Golf Championship, the United States
824	824	Amateur Golf Championship of the United States Golf
825	825	Association, and the United States Open Tennis Championship
826	826	shall each be treated as a separate event.
827	827	(41) The gross receipts from the sale of any aircraft
828	828	and replacement parts, components, systems, supplies, and
829	829	sundries affixed or used on the aircraft and ground support
830	830	equipment and vehicles used by or for the aircraft to or by a
831	831	certificated or licensed air carrier with a hub operation
832	832	within this state, for use in conducting intrastate,
833	833	interstate, or foreign commerce for transporting people or
834	834	property by air. For the purpose of this subdivision, the
835	835	words "hub operation within this state" shall be construed to
836	836	have both of the following criteria:
837	837	a. There originates from the location 15 or more flight
838	838	departures and five or more different first-stop destinations
839	839	393
840	840	394
841	841	395
842	842	396
843	843	397
844	844	398
845	845	399
846	846	400
847	847	401
848	848	402
849	849	403
850	850	404
851	851	405
852	852	406
853	853	407
854	854	408
855	855	409
856	856	410
857	857	411
858	858	412
859	859	413
860	860	414
861	861	415
862	862	416
863	863	417
864	864	418
865	865	419
866	866	420 HB438 INTRODUCEDHB438 INTRODUCED
867	867	Page 16
868	868	five days per week for six or more months during the calendar
869	869	year.
870	870	b. Passengers or property or both are regularly
871	871	exchanged at the location between flights of the same or a
872	872	different certificated or licensed air carrier.
873	873	(42) The gross receipts from the sale of hot or cold
874	874	food and beverage products sold to or by a certificated or
875	875	licensed air carrier with a hub operation within this state,
876	876	for use in conducting intrastate, interstate, or foreign
877	877	commerce for transporting people or property by air. For the
878	878	purpose of this subdivision, the words "hub operation within
879	879	this state" shall be construed to have all of the following
880	880	criteria:
881	881	a. There originates from the location 15 or more flight
882	882	departures and five or more different first-stop destinations
883	883	five days per week for six or more months during the calendar
884	884	year.
885	885	b. Passengers or property or both are regularly
886	886	exchanged at the location between flights of the same or a
887	887	different certificated or licensed air carrier.
888	888	(43) The gross receipts from the sale of any aviation
889	889	jet fuel to a certificated or licensed air carrier purchased
890	890	for use in scheduled all-cargo operations being conducted on
891	891	international flights or in international commerce. For
892	892	purposes of this subdivision, the following words or terms
893	893	shall be defined and interpreted as follows:
894	894	a. Air Carrier. Any person, firm, corporation, or
895	895	entity undertaking by any means, directly or indirectly, to
896	896	421
897	897	422
898	898	423
899	899	424
900	900	425
901	901	426
902	902	427
903	903	428
904	904	429
905	905	430
906	906	431
907	907	432
908	908	433
909	909	434
910	910	435
911	911	436
912	912	437
913	913	438
914	914	439
915	915	440
916	916	441
917	917	442
918	918	443
919	919	444
920	920	445
921	921	446
922	922	447
923	923	448 HB438 INTRODUCEDHB438 INTRODUCED
924	924	Page 17
925	925	provide air transportation.
926	926	b. All-Cargo Operations. Any flight conducted by an air
927	927	carrier for compensation or hire other than a passenger
928	928	carrying flight, except passengers as specified in 14 C.F.R. §
929	929	121.583(a) or 14 C.F.R. § 135.85, as amended.
930	930	c. International Commerce. Any air carrier engaged in
931	931	all-cargo operations transporting goods for compensation or
932	932	hire on international flights.
933	933	d. International Flights. Any air carrier conducting
934	934	scheduled all-cargo operations between any point within the 50
935	935	states of the United States and the District of Columbia and
936	936	any point outside the 50 states of the United States and the
937	937	District of Columbia, including any interim stops within the
938	938	United States so long as the ultimate origin or destination of
939	939	the aircraft is outside the United States and the District of
940	940	Columbia.
941	941	(44) The gross proceeds of the sale or sales of the
942	942	following:
943	943	a. Drill pipe, casing, tubing, and other pipe used for
944	944	the exploration for or production of oil, gas, sulphur, or
945	945	other minerals in offshore federal waters.
946	946	b. Tangible personal property exclusively used for the
947	947	exploration for or production of oil, gas, sulphur, or other
948	948	minerals in offshore federal waters.
949	949	c. Fuel and supplies for use or consumption aboard
950	950	boats, ships, aircraft, and towing vessels when used
951	951	exclusively in transporting persons or property between a
952	952	point in Alabama and a point or points in offshore federal
953	953	449
954	954	450
955	955	451
956	956	452
957	957	453
958	958	454
959	959	455
960	960	456
961	961	457
962	962	458
963	963	459
964	964	460
965	965	461
966	966	462
967	967	463
968	968	464
969	969	465
970	970	466
971	971	467
972	972	468
973	973	469
974	974	470
975	975	471
976	976	472
977	977	473
978	978	474
979	979	475
980	980	476 HB438 INTRODUCEDHB438 INTRODUCED
981	981	Page 18
982	982	waters for the exploration for or production of oil, gas,
983	983	sulphur, or other minerals in offshore federal waters.
984	984	d. Drilling equipment that is used for the exploration
985	985	for or production of oil, gas, sulphur, or other minerals,
986	986	that is built for exclusive use outside this state and that
987	987	is, on completion, removed forthwith from this state.
988	988	The delivery of items exempted by this subdivision to
989	989	the purchaser or lessee in this state does not disqualify the
990	990	purchaser or lessee from the exemption if the property is
991	991	removed from the state by any means, including by the use of
992	992	the purchaser's or lessee's own facilities.
993	993	The shipment to a place in this state of equipment
994	994	exempted by this subdivision for further assembly or
995	995	fabrication does not disqualify the purchaser or lessee from
996	996	the exemption if on completion of the further assembly or
997	997	fabrication the equipment is removed forthwith from this
998	998	state. This subdivision applies to a sale that may occur when
999	999	the equipment exempted is further assembled or fabricated if
1000	1000	on completion the equipment is removed forthwith from this
1001	1001	state.
1002	1002	(45) The gross receipts derived from all bingo games
1003	1003	and operations that are conducted in compliance with validly
1004	1004	enacted legislation authorizing the conduct of such games and
1005	1005	operations, and which comply with the distribution
1006	1006	requirements of the applicable local laws; provided that the
1007	1007	exemption from sales taxation granted by this subdivision
1008	1008	shall apply only to gross receipts taxable under subdivision
1009	1009	(2) of Section 40-23-2. It is further provided that this
1010	1010	477
1011	1011	478
1012	1012	479
1013	1013	480
1014	1014	481
1015	1015	482
1016	1016	483
1017	1017	484
1018	1018	485
1019	1019	486
1020	1020	487
1021	1021	488
1022	1022	489
1023	1023	490
1024	1024	491
1025	1025	492
1026	1026	493
1027	1027	494
1028	1028	495
1029	1029	496
1030	1030	497
1031	1031	498
1032	1032	499
1033	1033	500
1034	1034	501
1035	1035	502
1036	1036	503
1037	1037	504 HB438 INTRODUCEDHB438 INTRODUCED
1038	1038	Page 19
1039	1039	exemption shall not apply to any gross receipts from the sale
1040	1040	of tangible personal property, such as concessions, novelties,
1041	1041	food, beverages, etc. The exemption provided for in this
1042	1042	section shall be limited to those games and operations by
1043	1043	organizations that have qualified for exemption under the
1044	1044	provisions of 26 U.S.C. § 501 (c) (3), (4), (7), (8), (10), or
1045	1045	(19), or which are defined in 26 U.S.C. § 501(d).
1046	1046	(46) The gross receipts derived from the sale or sales
1047	1047	of fruit or other agricultural products by the person or
1048	1048	company, as defined in Section 40-23-1, that planted or
1049	1049	cultivated and harvested the fruit or agricultural product,
1050	1050	when the land is owned or leased by the seller.
1051	1051	(47) The gross receipts derived from the sale or sales
1052	1052	of all domestically mined or produced coal, coke, and coke
1053	1053	by-products used in cogeneration plants.
1054	1054	(48) The gross receipts from the sale or sales of
1055	1055	metal, other than gold or silver, when such metal is purchased
1056	1056	for the purpose of transferring such metal to an investment
1057	1057	trust in exchange for shares or other units, each of which are
1058	1058	both publicly traded and represent fractional undivided
1059	1059	beneficial interests in the trust's net assets, including
1060	1060	metal stored in warehouses located in this state, as well as
1061	1061	the gross proceeds from the sale or other transfer of such
1062	1062	metal to or from the investment trust in exchange for shares
1063	1063	or other units that are publicly traded and represent
1064	1064	fractional undivided beneficial interests in the trust's net
1065	1065	assets but not to the extent that metal is transferred to or
1066	1066	from the investment trust in exchange for consideration other
1067	1067	505
1068	1068	506
1069	1069	507
1070	1070	508
1071	1071	509
1072	1072	510
1073	1073	511
1074	1074	512
1075	1075	513
1076	1076	514
1077	1077	515
1078	1078	516
1079	1079	517
1080	1080	518
1081	1081	519
1082	1082	520
1083	1083	521
1084	1084	522
1085	1085	523
1086	1086	524
1087	1087	525
1088	1088	526
1089	1089	527
1090	1090	528
1091	1091	529
1092	1092	530
1093	1093	531
1094	1094	532 HB438 INTRODUCEDHB438 INTRODUCED
1095	1095	Page 20
1096	1096	than such publicly traded shares or other units. For purposes
1097	1097	of this subdivision, the term "metals" includes, but is not
1098	1098	limited to, copper, aluminum, nickel, zinc, tin, lead, and
1099	1099	other similar metals typically used in commercial and
1100	1100	industrial applications.
1101	1101	(49)a. For the period commencing on October 1, 2012,
1102	1102	and ending May 30, 2027, the gross receipts from the sale of
1103	1103	parts, components, and systems that become a part of a fixed
1104	1104	or rotary wing military aircraft or certified transport
1105	1105	category aircraft that undergoes conversion, reconfiguration,
1106	1106	or general maintenance so long as the address of the aircraft
1107	1107	for FAA registration is not in the state; provided, however,
1108	1108	that this exemption shall not apply to a local sales tax
1109	1109	unless previously exempted by local law or approved by
1110	1110	resolution of the local governing body.
1111	1111	b. The exemption authorized by this subdivision shall
1112	1112	not be available for sales of parts, components, or systems
1113	1113	for new contracts or projects entered into after May 30, 2027,
1114	1114	unless the Legislature enacts legislation to continue or
1115	1115	reinstate the exemption for new contracts or projects after
1116	1116	that date. No action or inaction on the part of the
1117	1117	Legislature shall reduce, suspend, or disqualify sales of
1118	1118	parts, components, or systems from the exemption in any past
1119	1119	year or future years until May 30, 2030, with respect to
1120	1120	contracts or projects entered into on or before May 30, 2027;
1121	1121	it being the sole intent that failure of the Legislature to
1122	1122	enact legislation to reinstate the exemption for new contracts
1123	1123	or projects after May 30, 2027, shall affect only the
1124	1124	533
1125	1125	534
1126	1126	535
1127	1127	536
1128	1128	537
1129	1129	538
1130	1130	539
1131	1131	540
1132	1132	541
1133	1133	542
1134	1134	543
1135	1135	544
1136	1136	545
1137	1137	546
1138	1138	547
1139	1139	548
1140	1140	549
1141	1141	550
1142	1142	551
1143	1143	552
1144	1144	553
1145	1145	554
1146	1146	555
1147	1147	556
1148	1148	557
1149	1149	558
1150	1150	559
1151	1151	560 HB438 INTRODUCEDHB438 INTRODUCED
1152	1152	Page 21
1153	1153	availability of the exemption to new contracts and projects
1154	1154	after that date and shall not affect availability of the
1155	1155	exemption for contracts or projects entered into on or before
1156	1156	May 30, 2027, for which the exemption shall be available until
1157	1157	May 30, 2030.
1158	1158	(50) The gross proceeds from the sale or sales within
1159	1159	school buildings of lunches to pupils of kindergarten,
1160	1160	grammar, and high schools, either public or private, that are
1161	1161	not sold for profit.
1162	1162	(51) The gross proceeds of services provided by
1163	1163	photographers, including, but not limited to, sitting fees and
1164	1164	consultation fees, even when provided as part of a transaction
1165	1165	ultimately involving the sale of one or more photographs, so
1166	1166	long as the exempt services are separately stated to the
1167	1167	customer on a bill of sale, invoice, or like memorialization
1168	1168	of the transaction. For transactions occurring before October
1169	1169	1, 2017, neither the Department of Revenue nor local tax
1170	1170	officials may seek payment for sales tax not collected. With
1171	1171	regard to such transactions in which sales tax was collected
1172	1172	and remitted on services provided by photographers, neither
1173	1173	the taxpayer nor the entity remitting sales tax shall have the
1174	1174	right to seek refund of such tax.
1175	1175	(52) a. For the period commencing on June 1, 2018, and
1176	1176	ending 10 years thereafter, unless extended by an act of the
1177	1177	Legislature, the gross proceeds of sales of bullion or money,
1178	1178	as defined in Section 40-1-1(7).
1179	1179	b. For purposes of this subdivision, the following
1180	1180	words or terms shall be defined and interpreted as follows:
1181	1181	561
1182	1182	562
1183	1183	563
1184	1184	564
1185	1185	565
1186	1186	566
1187	1187	567
1188	1188	568
1189	1189	569
1190	1190	570
1191	1191	571
1192	1192	572
1193	1193	573
1194	1194	574
1195	1195	575
1196	1196	576
1197	1197	577
1198	1198	578
1199	1199	579
1200	1200	580
1201	1201	581
1202	1202	582
1203	1203	583
1204	1204	584
1205	1205	585
1206	1206	586
1207	1207	587
1208	1208	588 HB438 INTRODUCEDHB438 INTRODUCED
1209	1209	Page 22
1210	1210	1. Bullion. Gold, silver, platinum, palladium, or a
1211	1211	combination of each precious metal, that has gone through a
1212	1212	refining process and for which the item's value depends on its
1213	1213	mass and purity, and not on its form, numismatic value, or
1214	1214	other value. The term includes bullion in the form of bars,
1215	1215	ingots, rounds, or coins that meet the requirements set forth
1216	1216	above. Qualifying bullion may contain other metals or
1217	1217	substances, provided that the other substances are minimal in
1218	1218	value compared with the value of the gold, silver, platinum,
1219	1219	or palladium and the other substances do not add value to the
1220	1220	item. For purposes of this subparagraph, "gold, silver,
1221	1221	platinum, or palladium" does not include jewelry or works of
1222	1222	art.
1223	1223	2. Mass. An item's mass is its weight in precious
1224	1224	metal.
1225	1225	3. Numismatic Value. An external value above and beyond
1226	1226	the base value of the underlying precious metal, due to the
1227	1227	item's rarity, condition, age, or other external factor.
1228	1228	4. Purity. An item's purity is the proportion of
1229	1229	precious metal contained within.
1230	1230	c. In order for bullion to qualify for the sales tax
1231	1231	exemption, gold, silver, platinum, and palladium items must
1232	1232	meet all of the following requirements:
1233	1233	1. Must be refined.
1234	1234	2. Must contain at least 80 percent gold, silver,
1235	1235	platinum, or palladium or some combination of these metals.
1236	1236	3. The sales price of the item must fluctuate with and
1237	1237	depend on the market price of the underlying precious metal,
1238	1238	589
1239	1239	590
1240	1240	591
1241	1241	592
1242	1242	593
1243	1243	594
1244	1244	595
1245	1245	596
1246	1246	597
1247	1247	598
1248	1248	599
1249	1249	600
1250	1250	601
1251	1251	602
1252	1252	603
1253	1253	604
1254	1254	605
1255	1255	606
1256	1256	607
1257	1257	608
1258	1258	609
1259	1259	610
1260	1260	611
1261	1261	612
1262	1262	613
1263	1263	614
1264	1264	615
1265	1265	616 HB438 INTRODUCEDHB438 INTRODUCED
1266	1266	Page 23
1267	1267	and not on the item's rarity, condition, age, or other
1268	1268	external factor.
1269	1269	(53) a. The gross proceeds of the initial retail sales
1270	1270	of adaptive equipment that is permanently affixed to a motor
1271	1271	vehicle.
1272	1272	b. For the purposes of this subdivision, the following
1273	1273	words or terms shall be defined and interpreted as follows:
1274	1274	1. Adaptive Equipment. Equipment not generally used by
1275	1275	persons with normal mobility that is appropriate for use in a
1276	1276	motor vehicle and that is not normally provided by a motor
1277	1277	vehicle manufacturer.
1278	1278	2. Motor Vehicle. A vehicle as defined in Section
1279	1279	40-12-240.
1280	1280	3. Motor Vehicle Manufacturer. Every person engaged in
1281	1281	the business of constructing or assembling vehicles or
1282	1282	manufactured homes.
1283	1283	c. In order to qualify for the exemption provided for
1284	1284	herein, the adaptive equipment must be separately stated to
1285	1285	the customer on a bill of sale, invoice, or like
1286	1286	memorialization of the transaction.
1287	1287	(54) For the period commencing on October 1, 2022, and
1288	1288	ending September 30, 2027, unless extended by an act of the
1289	1289	Legislature, the gross receipts derived from the sale of
1290	1290	producer value added agricultural products when the sale is
1291	1291	made by the producer or by the producer's immediate family, or
1292	1292	for the producer by the producer's employees.
1293	1293	(55) a. The gross proceeds from the sales of diapers
1294	1294	and menstrual hygiene products for personal use.
1295	1295	617
1296	1296	618
1297	1297	619
1298	1298	620
1299	1299	621
1300	1300	622
1301	1301	623
1302	1302	624
1303	1303	625
1304	1304	626
1305	1305	627
1306	1306	628
1307	1307	629
1308	1308	630
1309	1309	631
1310	1310	632
1311	1311	633
1312	1312	634
1313	1313	635
1314	1314	636
1315	1315	637
1316	1316	638
1317	1317	639
1318	1318	640
1319	1319	641
1320	1320	642
1321	1321	643
1322	1322	644 HB438 INTRODUCEDHB438 INTRODUCED
1323	1323	Page 24
1324	1324	b. For the purpose of this subdivision the following
1325	1325	words and phrases shall have the following meanings:
1326	1326	(1) DIAPER. Any absorbent diaper or undergarment used
1327	1327	for incontinence in adults and any absorbent diaper or
1328	1328	undergarment designed to be worn by a child who cannot control
1329	1329	bladder or bowel movements.
1330	1330	(2) MENSTRUAL HYGEINE PRODUCT. Tampons, menstrual pads,
1331	1331	sanitary napkins, panty liners, menstrual sponges, and
1332	1332	menstrual cups, including disposable and washable versions of
1333	1333	these items.
1334	1334	(b) Any violation of any provision of this section
1335	1335	shall be punishable in a court of competent jurisdiction by a
1336	1336	fine of not less than five hundred dollars ($500) and no more
1337	1337	than two thousand dollars ($2,000) and imprisonment of not
1338	1338	less than six months nor more than one year in the county
1339	1339	jail."
1340	1340	Section 2. The Alabama Department of Revenue shall
1341	1341	adopt rules and develop any tax forms, directions, and
1342	1342	worksheets as necessary to effectuate the intent of this act.
1343	1343	Section 3. This act shall become effective on September
1344	1344	1, 2023 following its passage and approval by the Governor, or
1345	1345	its otherwise becoming law.
1346	1346	645
1347	1347	646
1348	1348	647
1349	1349	648
1350	1350	649
1351	1351	650
1352	1352	651
1353	1353	652
1354	1354	653
1355	1355	654
1356	1356	655
1357	1357	656
1358	1358	657
1359	1359	658
1360	1360	659
1361	1361	660
1362	1362	661
1363	1363	662
1364	1364	663
1365	1365	664
1366	1366	665
1367	1367	666