SB169INTRODUCED
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L6LJYA-1
By Senator Allen
RFD: County and Municipal Government
First Read: 05-Apr-23
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5 L6LJYA-1 03/06/2023 FC (L) ma 2023-614
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SYNOPSIS:
Under existing law, a municipality may require a
business to obtain a local business license that is
based on gross receipts.
This bill would allow any business paying a
municipal business license based on gross receipts to
deduct from gross receipts any excise tax imposed by
the federal, state, and local governments.
A BILL
TO BE ENACTED
AN ACT
Relating to municipalities; to amend Section
11-51-90.1, Code of Alabama 1975, relating to the municipal
business license tax; to specify that the definition of gross
receipts does not include any excise tax imposed by the
federal, state, and local governments.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Section 11-51-90.1, Code of Alabama 1975, is
amended to read as follows:
"ยง11-51-90.1
As used in this article, the following terms shall have
the following meanings:
(1) BUSINESS. Any commercial or industrial activity or
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any enterprise, trade, profession, occupation, or livelihood,
including the lease or rental of residential or nonresidential
real estate, whether or not carried on for gain or profit, and
whether or not engaged in as a principal or as an independent
contractor, which is engaged in, or caused to be engaged in,
within a municipality.
(2) BUSINESS LICENSE. An annual license issued by a
taxing jurisdiction for the privilege of doing any kind of
business, trade, profession, or any other activity in that
jurisdiction, by whatever name called, which document is
required to be conspicuously posted or displayed except to the
extent the taxpayer's business license tax or other financial
information is listed thereon or unless the municipality
affirmatively elects not to so require. However, municipal
occupational licenses, municipal gasoline taxes, municipal
tobacco taxes, or gross receipts taxes in the nature of a
sales tax, or any other municipal tax now in existence or that
may hereafter be adopted by a municipality pursuant to Section
11-51-90, or any other provision of state law other than an
annual license, shall not be considered "business licenses."
(3) BUSINESS LICENSE REMITTANCE FORM. Any business
license return, renewal reminder notice, or other writing on
which a taxpayer calculates its business license tax liability
for all or part of the license year and remits the amount so
calculated with the form.
(4) DEPARTMENT or DEPARTMENT OF REVENUE. The Alabama
Department of Revenue, as created under Section 40-2-1, et
seq.
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(5) DESIGNEE. An agent of a taxing jurisdiction
authorized to administer or collect, or both, the
jurisdiction's business license taxes, which may include
another taxing jurisdiction, the Department of Revenue, or a
"private auditing or collecting firm" as defined in Section
40-2A-3.
(6) GROSS RECEIPTS. A measure of any and all receipts
of a business from whatever source derived, to the maximum
extent permitted by applicable laws and constitutional
provisions, to be used in calculating the amount due for a
business license. Provided, however, that:
a. Gross receipts shall not include any of the
following taxes collected by the business on behalf of any
taxing jurisdiction or the federal government: All taxes which
are imposed on the ultimate consumer, collected by the
taxpayer, and remitted by or on behalf of the taxpayer to the
taxing authority, whether state, local, or federal, including
utility gross receipts taxes levied pursuant to Article 3,
Chapter 21, Title 40; license taxes levied pursuant to Article
2, Chapter 21, Title 40; or any excise tax imposed by the
federal or state government or any local government whether
called an excise tax or license fee; or reimbursements to
professional employer organizations of federal, state, or
local payroll taxes or unemployment insurance contributions;
but no other deductions or exclusions from gross receipts
shall be allowed except as provided in this article.
b. A different basis for calculating the business
license may be used by a municipality with respect to certain
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categories of taxpayers as prescribed in Section 11-51-90.2.
c. For a utility or other entity described in Section
11-51-129, gross receipts shall be limited to the gross
receipts derived from the retail furnishing of utility
services within a municipality during the preceding year that
are taxed under Article 3 of Chapter 21 of Title 40, except
that nothing herein shall affect any existing contract or
agreement between a municipality and a utility or other
entity. The gross receipts derived from the furnishing of
utility services shall not be subject to further business
license taxation by a municipality.
d. Gross receipts shall not include dividends or other
distributions received by a corporation, or proceeds from
borrowings, the sale of a capital asset, the repayment of the
principal portion of a loan, the issuance of stock or other
equity investments, or capital contributions, or the
undistributed earnings of subsidiary entities.
(7) LICENSE FORM. Any business license application
form, renewal reminder notice, business license remittance
form, or business license return by whatever name called.
(8) LICENSE OFFICER or MUNICIPAL LICENSE OFFICER. The
municipal employee charged by the governing body of the
municipality with the primary responsibility of administering
the municipality's license tax and related matters.
(9) LICENSE YEAR. The calendar year.
(10) MUNICIPALITY. Any town or city in this state that
levies a business license tax from time to time. The term
shall also include the town's or city's police jurisdiction,
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where the business license tax is levied in the police
jurisdiction.
(11) PERSON. Any individual, association, estate,
trust, partnership, limited liability company, corporation, or
other entity of any kind, except for any nonprofit corporation
formed under the laws of Alabama which is operated to enable
municipalities that become members of such nonprofit
corporation to finance or refinance capital projects and
related undertakings, on a cooperative basis, and whose board
of directors or other governing body consists primarily of
elected officials of municipalities.
(12) TAXING JURISDICTION. Any municipality that levies
a business license tax, whether or not a business license tax
is levied within its police jurisdiction, or the Department of
Revenue acting as agent on behalf of a municipality pursuant
to Section 11-51-180, et seq., as the context requires.
(13) TAXPAYER. Any person subject to or liable under
this chapter for any business license tax; any person required
to file a return with respect to, or pay or remit the business
license tax levied under this chapter or to report any
information or value to the taxing jurisdiction; or any person
required to obtain, or who holds any interest in, any business
license issued by the taxing jurisdiction; or any person that
may be affected by any act or refusal to act by the taxing
jurisdiction under this chapter, or to keep any records
required by this chapter.
(14) U.S.C. The applicable title and section of the
United States Code, as amended from time to time.
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(15) OTHER TERMS. Other capitalized or specialized
terms used in Act 2006-586, and not defined above, shall have
the same meanings ascribed to them in Section 40-2A-3 unless
the context otherwise requires."
Section 2. This act shall become effective on the first
day of the third month following its passage and approval by
the Governor, or its otherwise becoming law.
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