Alabama 2023 Regular Session

Alabama Senate Bill SB257 Compare Versions

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

Old	New	Differences
1	1	SB257INTRODUCED
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3	3	S2RM77-1
4	4	By Senators Jones, Gudger, Elliott, Butler, Shelnutt, Bell,
5	5	Kelley, Coleman-Madison, Stewart, Figures, Weaver, Givhan,
6	6	Singleton, Smitherman, Allen, Roberts, Stutts, Williams,
7	7	Scofield, Waggoner, Livingston, Carnley, Hovey, Chambliss,
8	8	Sessions, Chesteen, Reed, Albritton, Barfoot, Beasley, Melson,
9	9	Price, Hatcher, Coleman, Orr
10	10	RFD: Finance and Taxation Education
11	11	First Read: 27-Apr-23
12	12	2023 Regular Session
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23	23	11 S2RM77-1 04/14/2023 KHF (F) KHF 2023-1553
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25	25	SYNOPSIS:
26	26	Under existing law, the state imposes sales or
27	27	use taxes upon certain persons, firms, or corporations.
28	28	Sales of certain items are taxed at a reduced rate.
29	29	"Food" is not a defined term and is taxed at the
30	30	general rate. Sales of other items are exempt from the
31	31	taxes.
32	32	This bill would define "food" for purposes of
33	33	sales and use taxes and begin phasing-out the state
34	34	sales and use tax on food on September 1, 2023. Future
35	35	rate reductions would be contingent upon certain growth
36	36	requirements in the Education Trust Fund.
37	37	This bill would establish the sales and use tax
38	38	rate on food for purposes of county and municipal sales
39	39	and use taxes as the existing general or retail sales
40	40	tax rate on the effective date of this act and allow a
41	41	county and municipal election to reduce the sales tax
42	42	rate or exempt food from local sales and use taxes.
43	43	A BILL
44	44	TO BE ENTITLED
45	45	AN ACT
46	46	Relating to sales taxes; to amend Section 40-23-1, as
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76	76	last amended by Acts 2022-199 and 2022-291, 2022 Regular
77	77	Session, Code of Alabama 1975, Section 40-23-2, as last
78	78	amended by Act 2022-346, 2022 Regular Session, Code of Alabama
79	79	1975, Section 40-23-60, as last amended by Act 2022-199, 2022
80	80	Regular Session, Code of Alabama 1975, and Section 40-23-61,
81	81	Code of Alabama 1975; to define "food" and begin phasing-out
82	82	the state sales and use tax on food on September 1, 2023; to
83	83	require certain growth targets in the Education Trust Fund for
84	84	future sales tax reductions on food; to establish the sales
85	85	and use tax rate on food for purposes of county and municipal
86	86	sales and use taxes as the existing general or retail sales
87	87	and use tax rate; and to authorize a county and municipality
88	88	to reduce the sales and use tax rate or exempt food from local
89	89	sales and use taxes.
90	90	BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
91	91	Section 1. Section 40-23-1, as last amended by Acts
92	92	2022-199 and 2022-291 in the 2022 Regular Session, Code of
93	93	Alabama 1975, Section 40-23-2, as last amended by Act 2022-346
94	94	in the 2022 Regular Session, Code of Alabama 1975, Section
95	95	40-23-60, as last amended by Act 2022-199 in the 2022 Regular
96	96	Session, Code of Alabama 1975, and Section 40-23-61, Code of
97	97	Alabama 1975, are amended to read as follows:
98	98	"§40-23-1
99	99	(a) For the purpose of this division, the following
100	100	terms shall have the respective meanings ascribed by this
101	101	section:
102	102	(1) PERSON or COMPANY. Used interchangeably, includes
103	103	any individual, firm, copartnership, association, corporation,
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133	133	receiver, trustee, or any other group or combination acting as
134	134	a unit and the plural as well as the singular number, unless
135	135	the intention to give a more limited meaning is disclosed by
136	136	the context.
137	137	(2) DEPARTMENT. The Department of Revenue of the State
138	138	of Alabama.
139	139	(3) COMMISSIONER. The Commissioner of Revenue of the
140	140	State of Alabama.
141	141	(4) TAX YEAR or TAXABLE YEAR. The calendar year.
142	142	(5) SALE or SALES. Installment and credit sales and the
143	143	exchange of properties as well as the sale thereof for money,
144	144	every closed transaction constituting a sale. Provided,
145	145	however, a transaction shall not be closed or a sale completed
146	146	until the time and place when and where title is transferred
147	147	by the seller or seller's agent to the purchaser or
148	148	purchaser's agent, and for the purpose of determining transfer
149	149	of title, a common carrier or the U.S. Postal Service shall be
150	150	deemed to be the agent of the seller, regardless of any F.O.B.
151	151	point and regardless of who selects the method of
152	152	transportation, and regardless of by whom or the method by
153	153	which freight, postage, or other transportation charge is
154	154	paid. Provided further that, where billed as a separate item
155	155	to and paid by the purchaser, the freight, postage, or other
156	156	transportation charge paid to a common carrier or the U.S.
157	157	Postal Service is not a part of the selling price.
158	158	(6) GROSS PROCEEDS OF SALES. The value proceeding or
159	159	accruing from the sale of tangible personal property, and
160	160	including the proceeds from the sale of any property handled
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190	190	on consignment by the taxpayer, including merchandise of any
191	191	kind and character without any deduction on account of the
192	192	cost of the property sold, the cost of the materials used,
193	193	labor or service cost, interest paid, any consumer excise
194	194	taxes that may be included within the sales price of the
195	195	property sold, or any other expenses whatsoever, and without
196	196	any deductions on account of losses; provided, that cash
197	197	discounts allowed and taken on sales shall not be included,
198	198	and "gross proceeds of sales" shall not include the sale price
199	199	of property returned by customers when the full sales price
200	200	thereof is refunded either in cash or by credit. The term
201	201	"gross proceeds of sale" shall also mean and include the
202	202	reasonable and fair market value of any tangible personal
203	203	property previously purchased at wholesale which is withdrawn
204	204	or used from the business or stock and used or consumed in
205	205	connection with a business, and shall also mean and include
206	206	the reasonable and fair market value of any tangible personal
207	207	property previously purchased at wholesale which is withdrawn
208	208	from the business or stock and used or consumed by any person
209	209	so withdrawing the same, except property that has been
210	210	previously withdrawn from business or stock and so used or
211	211	consumed with respect to which property the tax has been paid
212	212	because of previous withdrawal, use, or consumption, except
213	213	property that enters into and becomes an ingredient or
214	214	component part of tangible personal property or products
215	215	manufactured or compounded for sale and not for the personal
216	216	and private use or consumption of any person so withdrawing,
217	217	using, or consuming the same, and except refinery, residue, or
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247	247	fuel gas, whether in a liquid or gaseous state, that has been
248	248	generated by, or is otherwise a by-product of, a
249	249	petroleum-refining process, which gas is then utilized in the
250	250	process to generate heat or is otherwise utilized in the
251	251	distillation or refining of petroleum products.
252	252	In the case of the retail sale of equipment,
253	253	accessories, fixtures, and other similar tangible personal
254	254	property used in connection with the sale of commercial mobile
255	255	services as defined herein, or in connection with satellite
256	256	television services, at a price below cost, "gross proceeds of
257	257	sale" shall only include the stated sales price thereof and
258	258	shall not include any sales commission or rebate received by
259	259	the seller as a result of the sale. As used herein, the term
260	260	"commercial mobile services" shall have the same meaning as
261	261	that term has in 47 U.S.C. §§ 153(n) and 332(d), as in effect
262	262	from time to time.
263	263	(7) TAXPAYER. Any person liable for taxes hereunder.
264	264	(8) GROSS RECEIPTS. The value proceeding or accruing
265	265	from the sale of tangible personal property, including
266	266	merchandise and commodities of any kind and character, all
267	267	receipts actual and accrued, by reason of any business engaged
268	268	in, not including, however, interest, discounts, rentals of
269	269	real estate, or royalties, and without any deduction on
270	270	account of the cost of the property sold, the cost of the
271	271	materials used, labor or service cost, interest paid, any
272	272	consumer excise taxes that may be included in the sales price
273	273	of the property sold, or any other expenses whatsoever and
274	274	without any deductions on account of losses. The term "gross
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304	304	receipts" shall also mean and include the reasonable and fair
305	305	market value of any tangible personal property previously
306	306	purchased at wholesale which is withdrawn or used from the
307	307	business or stock and used or consumed in connection with a
308	308	business, and shall also mean and include the reasonable and
309	309	fair market value of any tangible personal property previously
310	310	purchased at wholesale which is withdrawn from the business or
311	311	stock and used or consumed by any person so withdrawing the
312	312	same, except property which has been previously withdrawn from
313	313	business or stock and so used or consumed and with respect to
314	314	which property the tax has been paid because of previous
315	315	withdrawal, use, or consumption, except property which enters
316	316	into and becomes an ingredient or component part of tangible
317	317	personal property or products manufactured or compounded for
318	318	sale as provided in subdivision (9) and not for the personal
319	319	and private use or consumption of any person so withdrawing,
320	320	using, or consuming the same, and except refinery, residue, or
321	321	fuel gas, whether in a liquid or gaseous state, that has been
322	322	generated by, or is otherwise a by-product of, a
323	323	petroleum-refining process, which gas is then utilized in the
324	324	process to generate heat or is otherwise utilized in the
325	325	distillation or refining of petroleum products.
326	326	(9) WHOLESALE SALE or SALE AT WHOLESALE. Any one of the
327	327	following:
328	328	a. A sale of tangible personal property by wholesalers
329	329	to licensed retail merchants, jobbers, dealers, or other
330	330	wholesalers for resale and does not include a sale by
331	331	wholesalers to users or consumers, not for resale.
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361	361	b. A sale of tangible personal property or products,
362	362	including iron ore, and including the furnished container and
363	363	label of the property or products, to a manufacturer or
364	364	compounder which enter into and become an ingredient or
365	365	component part of the tangible personal property or products
366	366	that the manufacturer or compounder manufactures or compounds
367	367	for sale, whether or not the tangible personal property or
368	368	product used in manufacturing or compounding a finished
369	369	product is used with the intent that it becomes a component of
370	370	the finished product; provided, however, that it is the intent
371	371	of this section that no sale of capital equipment, machinery,
372	372	tools, or product shall be included in the term "wholesale
373	373	sale." The term "capital equipment, machinery, tools, or
374	374	product" shall mean property that is subject to depreciation
375	375	allowances for Alabama income tax purposes.
376	376	c. A sale of containers intended for one-time use only,
377	377	and the labels thereof, when containers are sold without
378	378	contents to persons who sell or furnish containers along with
379	379	the contents placed therein for sale by persons.
380	380	d. A sale of pallets intended for one-time use only
381	381	when pallets are sold without contents to persons who sell or
382	382	furnish pallets along with the contents placed thereon for
383	383	sale by persons.
384	384	e. A sale to a manufacturer or compounder, of crowns,
385	385	caps, and tops intended for one-time use employed and used
386	386	upon the containers in which a manufacturer or compounder
387	387	markets his products.
388	388	f. A sale of containers to persons engaged in selling
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418	418	or otherwise supplying or furnishing baby chicks to growers
419	419	thereof where containers are used for the delivery of chicks
420	420	or a sale of containers for use in the delivery of eggs by the
421	421	producer thereof to the distributor or packer of eggs even
422	422	though containers used for delivery of baby chicks or eggs may
423	423	be recovered for reuse.
424	424	g. A sale of bagging and ties used in preparing cotton
425	425	for market.
426	426	h. A sale to meat packers, manufacturers, compounders,
427	427	or processors of meat products of all casings used in molding
428	428	or forming wieners and Vienna sausages even though casings may
429	429	be recovered for reuse.
430	430	i. A sale of commercial fish feed including
431	431	concentrates, supplements, and other feed ingredients when
432	432	substances are used as ingredients in mixing and preparing
433	433	feed for fish raised to be sold on a commercial basis.
434	434	j. A sale of bait used to capture or attempt to capture
435	435	fish or other seafood in the process of commercial fishing by
436	436	a holder of a commercial license issued pursuant to Chapter 12
437	437	of Title 9.
438	438	k. A sale of tangible personal property to any person
439	439	engaging in the business of leasing or renting tangible
440	440	personal property to others, if tangible personal property is
441	441	purchased for the purpose of leasing or renting it to others
442	442	under a transaction subject to the privilege or license tax
443	443	levied in Article 4 of Chapter 12 of this title against any
444	444	person engaging in the business of leasing or renting tangible
445	445	personal property to others.
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475	475	l. A purchase or withdrawal of parts or materials from
476	476	stock by any person licensed under this division where parts
477	477	or materials are used in repairing or reconditioning the
478	478	tangible personal property of a licensed person, which
479	479	tangible personal property is a part of the stock of goods of
480	480	a licensed person, offered for sale by him or her, and not for
481	481	use or consumption of a licensed person.
482	482	(10) SALE AT RETAIL or RETAIL SALE. All sales of
483	483	tangible personal property except those defined as wholesale
484	484	sales. The quantities of goods sold or prices at which sold
485	485	are immaterial in determining whether or not a sale is at
486	486	retail. Sales of building materials to contractors, builders,
487	487	or landowners for resale or use in the form of real estate are
488	488	retail sales in whatever quantity sold. Sales of building
489	489	materials, fixtures, or other equipment to a manufacturer or
490	490	builder of modular buildings for use in manufacturing,
491	491	building, or equipping a modular building ultimately becoming
492	492	a part of real estate situated in the State of Alabama are
493	493	retail sales, and the use, sale, or resale of building shall
494	494	not be subject to the tax. Sales of tangible personal property
495	495	to undertakers and morticians are retail sales and subject to
496	496	the tax at the time of purchase, but are not subject to the
497	497	tax on resale to the consumer. Sales of tangible personal
498	498	property or products to manufacturers, quarry operators, mine
499	499	operators, or compounders, which are used or consumed by them
500	500	in manufacturing, mining, quarrying, or compounding and do not
501	501	become an ingredient or component part of the tangible
502	502	personal property manufactured or compounded as provided in
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532	532	subdivision (9) are retail sales. The term "sale at retail" or
533	533	"retail sale" shall also mean and include the withdrawal, use,
534	534	or consumption of any tangible personal property by any one
535	535	who purchases same at wholesale, except property that has been
536	536	previously withdrawn from the business or stock and so used or
537	537	consumed and with respect to which property tax has been paid
538	538	because of previous withdrawal, use, or consumption, except
539	539	property that enters into and becomes an ingredient or
540	540	component part of tangible personal property or products
541	541	manufactured or compounded for sale as provided in subdivision
542	542	(9) and not for the personal and private use or consumption of
543	543	any person so withdrawing, using, or consuming the same; and
544	544	wholesale purchaser shall report and pay the taxes thereon. In
545	545	the case of the sale of equipment, accessories, fixtures, and
546	546	other similar tangible personal property used in connection
547	547	with the sale of commercial mobile services as defined in
548	548	subdivision (6), or in connection with satellite television
549	549	services, at a price below cost, the term "sale at retail" and
550	550	"retail sale" shall include those sales, and those sales shall
551	551	not also be taxable as a withdrawal, use, or consumption of
552	552	such tangible personal property.
553	553	(11) BUSINESS. All activities engaged in, or caused to
554	554	be engaged in, with the object of gain, profit, benefit, or
555	555	advantage, either direct or indirect, and not excepting
556	556	subactivities producing marketable commodities used or
557	557	consumed in the main business activity, each of which
558	558	subactivities shall be considered business engaged in, taxable
559	559	in the class in which it falls.
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589	589	(12) AUTOMOTIVE VEHICLE. A power shovel, dragline,
590	590	crawler, crawler crane, ditcher, or any similar machine that
591	591	is self-propelled, in addition to self-propelled machines that
592	592	are used primarily as instruments of conveyance.
593	593	(13) PREPAID TELEPHONE CALLING CARD. A sale of a
594	594	prepaid telephone calling card or a prepaid authorization
595	595	number, or both, shall be deemed the sale of tangible personal
596	596	property subject to the tax imposed on the sale of tangible
597	597	personal property pursuant to this chapter. For purposes of
598	598	this subdivision, the sale of prepaid wireless service that is
599	599	evidenced by a physical card constitutes the sale of a prepaid
600	600	telephone calling card, and the sale of prepaid wireless
601	601	service that is not evidenced by a physical card constitutes
602	602	the sale of a prepaid authorization number.
603	603	(14) PREPAID WIRELESS SERVICE. The right to use mobile
604	604	telecommunications service, which must be paid for in advance
605	605	and that is sold in predetermined units or dollars of which
606	606	the number declines with use in a known amount, and which may
607	607	include rights to use non-telecommunications services or to
608	608	download digital products or digital content. For purposes of
609	609	this subdivision, mobile telecommunications service has the
610	610	meaning ascribed by Section 40-21-120.
611	611	(15) CONSUMABLE VAPOR PRODUCT. Any nicotine liquid
612	612	solution or other material containing nicotine that is
613	613	depleted when used as a vapor product.
614	614	(16) VAPOR PRODUCTS. Any non-lighted, noncombustible
615	615	product that employs a mechanical heating element, battery, or
616	616	electronic circuit regardless of shape or size and that can be
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646	646	used to produce vapor from nicotine in a solution. The term
647	647	includes any vapor cartridge or other container of nicotine in
648	648	a solution or other form that is intended to be used with or
649	649	in an electronic cigarette, electronic cigar, electronic
650	650	cigarillo, electronic pipe, or similar product or device. The
651	651	term does not include any product regulated by the United
652	652	States Food and Drug Administration under Chapter V of the
653	653	Federal Food, Drug, and Cosmetic Act.
654	654	(17) PRODUCER VALUE ADDED AGRICULTURAL PRODUCTS. Fruits
655	655	or other agricultural products that have undergone some degree
656	656	of further processing by the original producer of the
657	657	agricultural product, including, but not limited to, whole
658	658	cuts of meat, bound cut flowers, jams, jellies, or boiled or
659	659	roasted peanuts.
660	660	(18) COMMERCIAL FISHING. The activity of catching or
661	661	processing fish or other seafood regularly and exclusively as
662	662	a means of livelihood by a holder of a commercial license
663	663	issued pursuant to Chapter 12 of Title 9. The term includes
664	664	shellfish farmers, shrimpers, oysterers, lobsterers, and
665	665	crabbers.
666	666	(19) COMMERCIAL FISHING VESSEL. Any vessel whose
667	667	masters and owners are regularly and exclusively engaged in
668	668	commercial fishing as their means of livelihood.
669	669	(20) FOOD. Food as defined in 7 U.S.C § 2011, et seq.,
670	670	for the purposes of the federal Supplemental Nutrition
671	671	Assistance Program regardless of where or by what means food
672	672	is sold. In the event that the federal Supplemental Nutrition
673	673	Assistance Program definition no longer exists, the
674	674	309
675	675	310
676	676	311
677	677	312
678	678	313
679	679	314
680	680	315
681	681	316
682	682	317
683	683	318
684	684	319
685	685	320
686	686	321
687	687	322
688	688	323
689	689	324
690	690	325
691	691	326
692	692	327
693	693	328
694	694	329
695	695	330
696	696	331
697	697	332
698	698	333
699	699	334
700	700	335
701	701	336 SB257 INTRODUCEDSB257 INTRODUCED
702	702	Page 13
703	703	Legislature shall provide a new definition of "food" by
704	704	general law.
705	705	(b) The use within this state of tangible personal
706	706	property by the manufacturer thereof, as building materials in
707	707	the performance of a construction contract, for the purposes
708	708	of this division, shall be considered as a retail sale thereof
709	709	by the manufacturer, who shall also be construed as the
710	710	ultimate consumer of materials or property, and who shall be
711	711	required to report transaction and pay the sales tax thereon,
712	712	based upon the reasonable and fair market price thereof at the
713	713	time and place where same are used or consumed by the
714	714	manufacturer. Where the contractor is the manufacturer or
715	715	compounder of ready-mix concrete or asphalt plant mix used in
716	716	the performance of a contract, whether the ready-mix concrete
717	717	or asphalt plant mix is manufactured or compounded at the job
718	718	site or at a fixed or permanent plant location, the tax
719	719	applies only to the cost of the ingredients that become a
720	720	component part of the ready-mix concrete or the asphalt plant
721	721	mix. The provisions of this subsection shall not apply to any
722	722	tangible personal property that is specifically exempted from
723	723	the tax levied in this division.
724	724	(c) The sale of lumber by a lumber manufacturer to a
725	725	trucker for resale is a sale at wholesale as sales are defined
726	726	herein where the trucker is either a licensed dealer in lumber
727	727	or, if a resident of Alabama, has registered with the
728	728	Department of Revenue, and has received therefrom a
729	729	certificate of registration or, if a nonresident of this state
730	730	purchasing lumber for resale outside the State of Alabama, has
731	731	337
732	732	338
733	733	339
734	734	340
735	735	341
736	736	342
737	737	343
738	738	344
739	739	345
740	740	346
741	741	347
742	742	348
743	743	349
744	744	350
745	745	351
746	746	352
747	747	353
748	748	354
749	749	355
750	750	356
751	751	357
752	752	358
753	753	359
754	754	360
755	755	361
756	756	362
757	757	363
758	758	364 SB257 INTRODUCEDSB257 INTRODUCED
759	759	Page 14
760	760	furnished to the lumber manufacturer his or her name, address,
761	761	and the vehicle license number of the truck in which the
762	762	lumber is to be transported, which name, address, and vehicle
763	763	license number shall be shown on the sales invoice rendered by
764	764	the lumber manufacturer. The certificate provided for herein
765	765	shall be valid for the calendar year of its issuance and may
766	766	be renewed from year to year on application to the Department
767	767	of Revenue on or before January 31 of each succeeding year;
768	768	provided, that if not renewed the certificate shall become
769	769	invalid for the purpose of this division on February 1.
770	770	(d) The dispensing or transferring of ophthalmic
771	771	materials, including lenses, frames, eyeglasses, contact
772	772	lenses, and other therapeutic optic devices, to a patient by a
773	773	licensed ophthalmologist, as a part of his or her professional
774	774	service, for purposes of this division, shall constitute a
775	775	sale, subject to the state sales tax. The licensed
776	776	ophthalmologist or licensed optometrist shall collect the
777	777	state sales tax. In no event shall the providing of
778	778	professional services in connection with the dispensing or
779	779	transferring of ophthalmic materials, including dispensing
780	780	fees or fitting fees, by a licensed ophthalmologist or
781	781	licensed optometrist be considered a sale subject to the state
782	782	sales tax. When the ophthalmic materials are purchased by a
783	783	consumer covered by a third party benefit plan, including
784	784	Medicare, the sales tax shall be applicable to the amount that
785	785	the ophthalmologist, optometrist, or optician is reimbursed by
786	786	the third party benefit plan plus the amount that the consumer
787	787	pays to the ophthalmologist, optometrist, or optician at the
788	788	365
789	789	366
790	790	367
791	791	368
792	792	369
793	793	370
794	794	371
795	795	372
796	796	373
797	797	374
798	798	375
799	799	376
800	800	377
801	801	378
802	802	379
803	803	380
804	804	381
805	805	382
806	806	383
807	807	384
808	808	385
809	809	386
810	810	387
811	811	388
812	812	389
813	813	390
814	814	391
815	815	392 SB257 INTRODUCEDSB257 INTRODUCED
816	816	Page 15
817	817	time of the sale. All transfers of ophthalmic materials by
818	818	opticians or optometrists shall be considered retail sales
819	819	subject to the state sales tax. The term "supplier" shall
820	820	include but not be limited to optical laboratories, ophthalmic
821	821	material wholesalers, or anyone selling ophthalmic materials
822	822	to ophthalmologists.
823	823	(e) Notwithstanding the above, the withdrawal, use, or
824	824	consumption of a manufactured product by the manufacturer
825	825	thereof in quality control testing performed by employees or
826	826	independent contractors of the taxpayer, for purposes of this
827	827	division, shall not be deemed or considered to constitute a
828	828	transaction subject to sales tax, nor shall a gift by the
829	829	manufacturer of a manufactured product, withdrawn from the
830	830	manufacturer's inventory, to an entity listed in 26 U.S.C. §§
831	831	170(b) or (c), be considered a transaction subject to sales
832	832	tax.
833	833	(f) Notwithstanding the foregoing, a gift by a retailer
834	834	of a product or products where the aggregate retail value of
835	835	any single gift is equal to or less than ten thousand dollars
836	836	($10,000), withdrawn from the retailer's inventory, to an
837	837	entity listed in 26 U.S.C. §§ 170(b) or (c) shall not be
838	838	deemed or considered to constitute a transaction subject to
839	839	sales and use tax."
840	840	"§40-23-2
841	841	There is levied, in addition to all other taxes of
842	842	every kind now imposed by law, and shall be collected as
843	843	herein provided, a privilege or license tax against the person
844	844	on account of the business activities and in the amount to be
845	845	393
846	846	394
847	847	395
848	848	396
849	849	397
850	850	398
851	851	399
852	852	400
853	853	401
854	854	402
855	855	403
856	856	404
857	857	405
858	858	406
859	859	407
860	860	408
861	861	409
862	862	410
863	863	411
864	864	412
865	865	413
866	866	414
867	867	415
868	868	416
869	869	417
870	870	418
871	871	419
872	872	420 SB257 INTRODUCEDSB257 INTRODUCED
873	873	Page 16
874	874	determined by the application of rates against gross sales, or
875	875	gross receipts, as the case may be, as follows:
876	876	(1) Upon every person, firm, or corporation, (including
877	877	the State of Alabama and its Alcoholic Beverage Control Board
878	878	in the sale of alcoholic beverages of all kinds, the
879	879	University of Alabama, Auburn University, and all other
880	880	institutions of higher learning in the state, whether the
881	881	institutions be denominational, state, county, or municipal
882	882	institutions, any association or other agency or
883	883	instrumentality of the institutions) engaged or continuing
884	884	within this state, in the business of selling at retail any
885	885	tangible personal property whatsoever, including merchandise
886	886	and commodities of every kind and character, (not including,
887	887	however, bonds or other evidences of debts or stocks, nor
888	888	sales of material and supplies to any person for use in
889	889	fulfilling a contract for the painting, repair, or
890	890	reconditioning of vessels, barges, ships, other watercraft,
891	891	and commercial fishing vessels of over five tons load
892	892	displacement as registered with the U.S. Coast Guard and
893	893	licensed by the State of Alabama Department of Conservation
894	894	and Natural Resources) an amount equal to four percent of the
895	895	gross proceeds of sales of the business except where a
896	896	different amount is expressly provided herein. Provided,
897	897	however, that any person engaging or continuing in business as
898	898	a retailer and wholesaler or jobber shall pay the tax required
899	899	on the gross proceeds of retail sales of the business at the
900	900	rates specified, when his or her books are kept so as to show
901	901	separately the gross proceeds of sales of each business, and
902	902	421
903	903	422
904	904	423
905	905	424
906	906	425
907	907	426
908	908	427
909	909	428
910	910	429
911	911	430
912	912	431
913	913	432
914	914	433
915	915	434
916	916	435
917	917	436
918	918	437
919	919	438
920	920	439
921	921	440
922	922	441
923	923	442
924	924	443
925	925	444
926	926	445
927	927	446
928	928	447
929	929	448 SB257 INTRODUCEDSB257 INTRODUCED
930	930	Page 17
931	931	when his or her books are not kept he or she shall pay the tax
932	932	as a retailer, on the gross sales of the business.
933	933	Where any used part including tires of an automotive
934	934	vehicle or a truck trailer, semitrailer, or house trailer is
935	935	taken in trade, or in a series of trades, as a credit or part
936	936	payment on the sale of a new or rebuilt part or tire, the tax
937	937	levied herein shall be paid on the net difference, that is,
938	938	the price of the new or used part or tire sold less the credit
939	939	for the used part or tire taken in trade, provided, however,
940	940	this provision shall not be construed to include batteries.
941	941	(2) Upon every person, firm, or corporation engaged or
942	942	continuing within this state in the business of conducting or
943	943	operating places of amusement or entertainment, billiard and
944	944	pool rooms, bowling alleys, amusement devices, musical
945	945	devices, theaters, opera houses, moving picture shows,
946	946	vaudevilles, amusement parks, athletic contests, including
947	947	wrestling matches, prize fights, boxing and wrestling
948	948	exhibitions, football and baseball games, (including athletic
949	949	contests, conducted by or under the auspices of any
950	950	educational institution within this state, or any athletic
951	951	association thereof, or other association whether the
952	952	institution or association be a denominational, a state, or
953	953	county, or a municipal institution, or association or a state,
954	954	county, or city school, or other institution, association or
955	955	school) skating rinks, race tracks, golf courses, or any other
956	956	place at which any exhibition, display, amusement, or
957	957	entertainment is offered to the public or place or places
958	958	where an admission fee is charged, including public bathing
959	959	449
960	960	450
961	961	451
962	962	452
963	963	453
964	964	454
965	965	455
966	966	456
967	967	457
968	968	458
969	969	459
970	970	460
971	971	461
972	972	462
973	973	463
974	974	464
975	975	465
976	976	466
977	977	467
978	978	468
979	979	469
980	980	470
981	981	471
982	982	472
983	983	473
984	984	474
985	985	475
986	986	476 SB257 INTRODUCEDSB257 INTRODUCED
987	987	Page 18
988	988	places and public dance halls of every kind and description
989	989	within the State of Alabama, an amount equal to four percent
990	990	of the gross receipts of any such business. Provided, however,
991	991	notwithstanding any language to the contrary in the prior
992	992	portion of this subdivision, the tax provisions so specified
993	993	shall not apply to any athletic event conducted by a public or
994	994	nonpublic primary or secondary school or any athletic event
995	995	conducted by or under the auspices of the Alabama High School
996	996	Athletic Association. The tax amount which would have been
997	997	collected pursuant to this subdivision shall continue to be
998	998	collected by the public or nonpublic primary or secondary
999	999	school, but shall be retained by the school that collected it
1000	1000	and shall be used by the school for school purposes.
1001	1001	(3) Upon every person, firm, or corporation engaged or
1002	1002	continuing within this state in the business of selling at
1003	1003	retail machines used in mining, quarrying, compounding,
1004	1004	processing, and manufacturing of tangible personal property an
1005	1005	amount equal to one and one-half percent of the gross proceeds
1006	1006	of the sale of the machines. The term "machine," as herein
1007	1007	used, shall include machinery which is used for mining,
1008	1008	quarrying, compounding, processing, or manufacturing tangible
1009	1009	personal property, and the parts of the machines, attachments,
1010	1010	and replacements therefor, which are made or manufactured for
1011	1011	use on or in the operation of the machines and which are
1012	1012	necessary to the operation of the machines and are customarily
1013	1013	so used.
1014	1014	(4) Upon every person, firm, or corporation engaged or
1015	1015	continuing within this state in the business of selling at
1016	1016	477
1017	1017	478
1018	1018	479
1019	1019	480
1020	1020	481
1021	1021	482
1022	1022	483
1023	1023	484
1024	1024	485
1025	1025	486
1026	1026	487
1027	1027	488
1028	1028	489
1029	1029	490
1030	1030	491
1031	1031	492
1032	1032	493
1033	1033	494
1034	1034	495
1035	1035	496
1036	1036	497
1037	1037	498
1038	1038	499
1039	1039	500
1040	1040	501
1041	1041	502
1042	1042	503
1043	1043	504 SB257 INTRODUCEDSB257 INTRODUCED
1044	1044	Page 19
1045	1045	retail any automotive vehicle or truck trailer, semitrailer,
1046	1046	or house trailer, or mobile home set-up materials and supplies
1047	1047	including but not limited to steps, blocks, anchoring, cable
1048	1048	pipes, and any other materials pertaining thereto, an amount
1049	1049	equal to two percent of the gross proceeds of sale of the
1050	1050	automotive vehicle or truck trailer, semitrailer, or house
1051	1051	trailer, or mobile home set-up materials and supplies
1052	1052	provided, however, where a person subject to the tax provided
1053	1053	for in this subdivision withdraws from his or her stock in
1054	1054	trade any automotive vehicle or truck trailer, semitrailer, or
1055	1055	house trailer for use by him or her or by his or her employee
1056	1056	or agent in the operation of the business, there shall be
1057	1057	paid, in lieu of the tax levied herein, a fee of five dollars
1058	1058	($5) per year or part thereof during which the automotive
1059	1059	vehicle, truck trailer, semitrailer, or house trailer shall
1060	1060	remain the property of the person. Each year or part thereof
1061	1061	shall begin with the day or anniversary date, as the case may
1062	1062	be, of such withdrawal and shall run for the 12 succeeding
1063	1063	months or part thereof during which the automotive vehicle,
1064	1064	truck trailer, semitrailer, or house trailer shall remain the
1065	1065	property of the person.
1066	1066	Where any used automotive vehicle or truck trailer,
1067	1067	semitrailer, or house trailer is taken in trade or in a series
1068	1068	of trades, as a credit or part payment on the sale of a new or
1069	1069	used vehicle, the tax levied herein shall be paid on the net
1070	1070	difference, that is, the price of the new or used vehicle sold
1071	1071	less the credit for the used vehicle taken in trade.
1072	1072	Sales of automobiles, motorcycles, trucks, truck
1073	1073	505
1074	1074	506
1075	1075	507
1076	1076	508
1077	1077	509
1078	1078	510
1079	1079	511
1080	1080	512
1081	1081	513
1082	1082	514
1083	1083	515
1084	1084	516
1085	1085	517
1086	1086	518
1087	1087	519
1088	1088	520
1089	1089	521
1090	1090	522
1091	1091	523
1092	1092	524
1093	1093	525
1094	1094	526
1095	1095	527
1096	1096	528
1097	1097	529
1098	1098	530
1099	1099	531
1100	1100	532 SB257 INTRODUCEDSB257 INTRODUCED
1101	1101	Page 20
1102	1102	trailers, travel trailers, campers, housecars, or semitrailers
1103	1103	that will be registered or titled outside Alabama, that are
1104	1104	exported or removed from Alabama within 72 hours by the
1105	1105	purchaser or his or her agent for first use outside Alabama
1106	1106	are subject to Alabama sales tax in an amount equal to only
1107	1107	the state automotive sales tax rate, unless the sales tax laws
1108	1108	of the state in which the purchaser will title or register the
1109	1109	vehicle allows an Alabama resident to purchase a motor vehicle
1110	1110	for first titling and registering in Alabama without the
1111	1111	payment of tax to that state. However, in no case shall the
1112	1112	amount of Alabama state sales tax due on a motor vehicle that
1113	1113	will be registered or titled for use in another state exceed
1114	1114	the amount of sales tax that would otherwise have been due in
1115	1115	the state where the vehicle will be registered or titled for
1116	1116	first use. In order to qualify as a travel trailer, camper, or
1117	1117	housecar that will be registered or titled for use in another
1118	1118	state, the purchaser must provide documentation to the seller
1119	1119	that the purchaser is not a resident of Alabama as required by
1120	1120	the Department of Revenue. No such proof is required in the
1121	1121	sale of an automobile, motorcycle, truck, truck trailer, or
1122	1122	semitrailer, excluding a travel trailer, camper, or housecar.
1123	1123	The tax collected under this export provision shall be Alabama
1124	1124	sales tax and shall exclude county and municipal sales tax. On
1125	1125	January 1, 2016, and each January 1 thereafter, the Alabama
1126	1126	Department of Revenue shall publish to the state's website a
1127	1127	list of states that do not allow drive out provisions to
1128	1128	Alabama residents. Should the list, required by this
1129	1129	subsection and relied upon by the taxpayer, be incorrect, the
1130	1130	533
1131	1131	534
1132	1132	535
1133	1133	536
1134	1134	537
1135	1135	538
1136	1136	539
1137	1137	540
1138	1138	541
1139	1139	542
1140	1140	543
1141	1141	544
1142	1142	545
1143	1143	546
1144	1144	547
1145	1145	548
1146	1146	549
1147	1147	550
1148	1148	551
1149	1149	552
1150	1150	553
1151	1151	554
1152	1152	555
1153	1153	556
1154	1154	557
1155	1155	558
1156	1156	559
1157	1157	560 SB257 INTRODUCEDSB257 INTRODUCED
1158	1158	Page 21
1159	1159	taxpayer shall be relieved from the liability concerning the
1160	1160	miscollection of the state automotive sales tax. Sales of all
1161	1161	other vehicles such as mobile homes, motor bikes, all terrain
1162	1162	vehicles, and boats do not qualify for the export exemption
1163	1163	provision and are taxable unless the dealer can provide
1164	1164	factual evidence that the vehicle was delivered outside of
1165	1165	Alabama or to a common carrier for transportation outside
1166	1166	Alabama. In order for the sale to be exempt from Alabama tax,
1167	1167	the information relative to the exempt sale shall be
1168	1168	documented on forms approved by the Revenue Department.
1169	1169	Of the total $.02 tax on each dollar of sale provided
1170	1170	hereunder, 58 percent of the total tax generated by this
1171	1171	subdivision (4) shall be deposited to the credit of the
1172	1172	Education Trust Fund and 42 percent of the total tax generated
1173	1173	by this subdivision (4) shall be deposited to the credit of
1174	1174	the State General Fund.
1175	1175	(5) Upon every person, firm, or corporation engaged or
1176	1176	continuing within this state in the business of selling
1177	1177	through coin-operated dispensing machines, food and food
1178	1178	products for human consumption, not including beverages other
1179	1179	than coffee, milk, milk products, and substitutes therefor,
1180	1180	there is levied a tax equal to three percent of the cost of
1181	1181	the food, food products, and beverages sold through the
1182	1182	machines, which cost for the purpose of this subdivision shall
1183	1183	be the gross proceeds of sales of the business.
1184	1184	(6) Upon every person, firm, or corporation engaged or
1185	1185	continuing within this state in the business of selling food
1186	1186	as defined in Section 40-23-1, there is a tax levied equal to
1187	1187	561
1188	1188	562
1189	1189	563
1190	1190	564
1191	1191	565
1192	1192	566
1193	1193	567
1194	1194	568
1195	1195	569
1196	1196	570
1197	1197	571
1198	1198	572
1199	1199	573
1200	1200	574
1201	1201	575
1202	1202	576
1203	1203	577
1204	1204	578
1205	1205	579
1206	1206	580
1207	1207	581
1208	1208	582
1209	1209	583
1210	1210	584
1211	1211	585
1212	1212	586
1213	1213	587
1214	1214	588 SB257 INTRODUCEDSB257 INTRODUCED
1215	1215	Page 22
1216	1216	four percent. Beginning September 1, 2023, the tax rate shall
1217	1217	be reduced to three and one-half percent. On November 1, 2024,
1218	1218	and on November 1 of every year thereafter until the tax rate
1219	1219	is two percent, the tax rate shall be reduced by one-half of
1220	1220	one percent. Provided, however, the rate of tax shall only be
1221	1221	reduced if the growth in total net receipts from all revenue
1222	1222	sources to the Education Trust Fund in the immediately
1223	1223	preceding fiscal year was at least two percent more than the
1224	1224	prior fiscal year. "
1225	1225	"§40-23-60
1226	1226	For the purpose of this article, the following terms
1227	1227	shall have the respective meanings ascribed to them in this
1228	1228	section:
1229	1229	(1) PERSON or COMPANY. Any individual, firm, company,
1230	1230	partnership, association, corporation, receiver or trustee, or
1231	1231	any other group or combination acting as a unit, and the
1232	1232	plural as well as the singular number, unless the intention to
1233	1233	give a more limited meaning is disclosed by the context.
1234	1234	(2) DEPARTMENT. The Department of Revenue of the State
1235	1235	of Alabama.
1236	1236	(3) COMMISSIONER. The Commissioner of Revenue of the
1237	1237	State of Alabama.
1238	1238	(4) WHOLESALE SALE or SALE AT WHOLESALE. Any one of the
1239	1239	following:
1240	1240	a. A sale of tangible personal property by wholesaler
1241	1241	to licensed retail merchants, jobbers, dealers or other
1242	1242	wholesalers for resale and does not include a sale by
1243	1243	wholesalers to users or consumers, not for resale.
1244	1244	589
1245	1245	590
1246	1246	591
1247	1247	592
1248	1248	593
1249	1249	594
1250	1250	595
1251	1251	596
1252	1252	597
1253	1253	598
1254	1254	599
1255	1255	600
1256	1256	601
1257	1257	602
1258	1258	603
1259	1259	604
1260	1260	605
1261	1261	606
1262	1262	607
1263	1263	608
1264	1264	609
1265	1265	610
1266	1266	611
1267	1267	612
1268	1268	613
1269	1269	614
1270	1270	615
1271	1271	616 SB257 INTRODUCEDSB257 INTRODUCED
1272	1272	Page 23
1273	1273	b. A sale of tangible personal property or products,
1274	1274	including iron ore, and including the furnished container and
1275	1275	label of such property or products, to a manufacturer or
1276	1276	compounder which enter into and become an ingredient or
1277	1277	component part of the tangible personal property or products
1278	1278	which the manufacturer or compounder manufactures or compounds
1279	1279	for sale, whether or not such tangible personal property or
1280	1280	product used in manufacturing or compounding a finished
1281	1281	product is used with the intent that it become a component of
1282	1282	the finished product; provided, however, that it is the intent
1283	1283	of this section that no sale of capital equipment, machinery,
1284	1284	tools, or product shall be included in the term "wholesale
1285	1285	sale." The term "capital equipment, machinery, tools, or
1286	1286	product" shall mean property that is subject to depreciation
1287	1287	allowances for Alabama income tax purposes.
1288	1288	c. A sale of containers intended for one-time use only,
1289	1289	and the labels thereof, when the containers are sold without
1290	1290	contents to persons who sell or furnish the containers along
1291	1291	with the contents placed therein for sale by such persons.
1292	1292	d. A sale of pallets intended for one-time use only
1293	1293	when the pallets are sold without contents to persons who sell
1294	1294	or furnish the pallets along with the contents placed thereon
1295	1295	for sale by such persons.
1296	1296	e. A sale to a manufacturer or compounder of crowns,
1297	1297	caps, and tops intended for one-time use employed and used
1298	1298	upon the containers in which the manufacturer or compounder
1299	1299	markets the manufacturer's or compounder's products.
1300	1300	f. A sale of containers to persons engaged in selling
1301	1301	617
1302	1302	618
1303	1303	619
1304	1304	620
1305	1305	621
1306	1306	622
1307	1307	623
1308	1308	624
1309	1309	625
1310	1310	626
1311	1311	627
1312	1312	628
1313	1313	629
1314	1314	630
1315	1315	631
1316	1316	632
1317	1317	633
1318	1318	634
1319	1319	635
1320	1320	636
1321	1321	637
1322	1322	638
1323	1323	639
1324	1324	640
1325	1325	641
1326	1326	642
1327	1327	643
1328	1328	644 SB257 INTRODUCEDSB257 INTRODUCED
1329	1329	Page 24
1330	1330	or otherwise supplying or furnishing baby chicks to growers
1331	1331	thereof where the containers are used for the delivery of the
1332	1332	chicks or a sale of containers for use in the delivery of eggs
1333	1333	by the producer thereof to the distributor or packer of the
1334	1334	eggs even though the containers used for delivery of baby
1335	1335	chicks or eggs may be recovered for reuse.
1336	1336	g. A sale of bagging and ties used in preparing cotton
1337	1337	for market.
1338	1338	h. A sale of commercial fish feed including
1339	1339	concentrates, supplements, and other feed ingredients when
1340	1340	such substances are used as ingredients in mixing and
1341	1341	preparing feed for fish raised to be sold on a commercial
1342	1342	basis.
1343	1343	i. A sale of bait used to capture or attempt to capture
1344	1344	fish or other seafood in the process of commercial fishing, as
1345	1345	defined in Section 40-23-1, by a holder of a commercial
1346	1346	license issued pursuant to Chapter 12 of Title 9.
1347	1347	j. A sale of tangible personal property to any person
1348	1348	engaging in the business of leasing or renting such tangible
1349	1349	personal property to others, if the tangible personal property
1350	1350	is purchased for the purpose of leasing or renting it to
1351	1351	others under a transaction subject to the privilege or license
1352	1352	tax levied in Article 4 of Chapter 12 against any person
1353	1353	engaging in the business of leasing or renting tangible
1354	1354	personal property to others.
1355	1355	k. A purchase or withdrawal of parts or materials from
1356	1356	stock by any person licensed under this article where the
1357	1357	parts or materials are used in repairing or reconditioning the
1358	1358	645
1359	1359	646
1360	1360	647
1361	1361	648
1362	1362	649
1363	1363	650
1364	1364	651
1365	1365	652
1366	1366	653
1367	1367	654
1368	1368	655
1369	1369	656
1370	1370	657
1371	1371	658
1372	1372	659
1373	1373	660
1374	1374	661
1375	1375	662
1376	1376	663
1377	1377	664
1378	1378	665
1379	1379	666
1380	1380	667
1381	1381	668
1382	1382	669
1383	1383	670
1384	1384	671
1385	1385	672 SB257 INTRODUCEDSB257 INTRODUCED
1386	1386	Page 25
1387	1387	tangible personal property of the licensed person which
1388	1388	tangible personal property is a part of the stock of goods of
1389	1389	the licensed person, offered for sale by the licensed person
1390	1390	and not for use or consumption of the licensed person.
1391	1391	l. A sale to meat packers, manufacturers, compounders,
1392	1392	or processors of meat products of all casings used in moulding
1393	1393	or forming wieners and Vienna sausages, even though the
1394	1394	casings may be recovered for reuse.
1395	1395	(5) SALE AT RETAIL or RETAIL SALE. All sales of
1396	1396	tangible personal property except those above defined as
1397	1397	wholesale sales. The quantities of goods sold or prices at
1398	1398	which sold are immaterial in determining whether or not a sale
1399	1399	is at retail. Sales of building materials to contractors,
1400	1400	builders, or landowners for resale or use in the form of real
1401	1401	estate are retail sales in whatever quantity sold. Sales of
1402	1402	building materials, fixtures, or other equipment to a
1403	1403	manufacturer or builder of modular buildings for use in
1404	1404	manufacturing, building, or equipping a modular building
1405	1405	ultimately becoming a part of real estate situated in the
1406	1406	State of Alabama are retail sales, and the use, sale, or
1407	1407	resale of such building shall not be subject to the tax. Sales
1408	1408	of tangible personal property to undertakers and morticians
1409	1409	are retail sales and subject to the tax at the time of
1410	1410	purchase, but are not subject to the tax on resale to the
1411	1411	consumer. Sales of tangible personal property or products to
1412	1412	manufacturers, quarry operators, mine operators, or
1413	1413	compounders, which are used or consumed by them in
1414	1414	manufacturing, mining, quarrying, or compounding and do not
1415	1415	673
1416	1416	674
1417	1417	675
1418	1418	676
1419	1419	677
1420	1420	678
1421	1421	679
1422	1422	680
1423	1423	681
1424	1424	682
1425	1425	683
1426	1426	684
1427	1427	685
1428	1428	686
1429	1429	687
1430	1430	688
1431	1431	689
1432	1432	690
1433	1433	691
1434	1434	692
1435	1435	693
1436	1436	694
1437	1437	695
1438	1438	696
1439	1439	697
1440	1440	698
1441	1441	699
1442	1442	700 SB257 INTRODUCEDSB257 INTRODUCED
1443	1443	Page 26
1444	1444	become an ingredient or component part of the tangible
1445	1445	personal property manufactured or compounded as provided in
1446	1446	subdivision (4) are retail sales. The term "sale at retail" or
1447	1447	"retail sale" shall also mean and include the withdrawal, use,
1448	1448	or consumption of any tangible personal property by anyone who
1449	1449	purchases same at wholesale, except property that has been
1450	1450	previously withdrawn from the business or stock and so used or
1451	1451	consumed and with respect to which property the tax has been
1452	1452	paid because of such previous withdrawal, use, or consumption,
1453	1453	except property that enters into and becomes an ingredient or
1454	1454	component part of tangible personal property or products
1455	1455	manufactured or compounded for sale as provided in subdivision
1456	1456	(4); and not for the personal and private use or consumption
1457	1457	of any person so withdrawing, using, or consuming the same,
1458	1458	and such wholesale purchaser shall report and pay the taxes
1459	1459	thereon; and except refinery, residue, or fuel gas, whether in
1460	1460	a liquid or gaseous state, that has been generated by, or is
1461	1461	otherwise a by-product of, a petroleum-refining process, which
1462	1462	gas is then utilized in the process to generate heat or is
1463	1463	otherwise utilized in the distillation or refining of
1464	1464	petroleum products. The term "retail sale" or "sale at retail"
1465	1465	shall also mean and include the sale of tangible personal
1466	1466	property previously purchased at wholesale for the purpose of
1467	1467	leasing or renting under a transaction subject to the
1468	1468	privilege or license tax levied in Article 4 of Chapter 12,
1469	1469	regardless of whether the sale is to the person who
1470	1470	theretofore leased or rented the tangible personal property or
1471	1471	to some other person.
1472	1472	701
1473	1473	702
1474	1474	703
1475	1475	704
1476	1476	705
1477	1477	706
1478	1478	707
1479	1479	708
1480	1480	709
1481	1481	710
1482	1482	711
1483	1483	712
1484	1484	713
1485	1485	714
1486	1486	715
1487	1487	716
1488	1488	717
1489	1489	718
1490	1490	719
1491	1491	720
1492	1492	721
1493	1493	722
1494	1494	723
1495	1495	724
1496	1496	725
1497	1497	726
1498	1498	727
1499	1499	728 SB257 INTRODUCEDSB257 INTRODUCED
1500	1500	Page 27
1501	1501	(6) BUSINESS. All activities engaged in, or caused to
1502	1502	be engaged in, with the object of gain, profit, benefit, or
1503	1503	advantage, either direct or indirect, and not excepting
1504	1504	subactivities producing marketable commodities used or
1505	1505	consumed in the main business activity, each of which
1506	1506	subactivities shall be considered business engaged in, taxable
1507	1507	in the class in which it falls.
1508	1508	(7) STORAGE. Any keeping or retention in this state for
1509	1509	any purpose except sale in the regular course of business or
1510	1510	subsequent use solely outside this state of tangible personal
1511	1511	property purchased at retail.
1512	1512	(8) USE. The exercise of any right or power over
1513	1513	tangible personal property incident to the ownership of that
1514	1514	property, or by any transaction where possession is given,
1515	1515	except that it shall not include the sale of that property in
1516	1516	the regular course of business.
1517	1517	(9) PURCHASE. Acquired for a consideration, whether
1518	1518	such acquisition was effected by a transfer of title, or of
1519	1519	possession or of both, or a license to use or consume; whether
1520	1520	such transfer shall have been absolute or conditional, and by
1521	1521	whatsoever means the same shall have been effected; and
1522	1522	whether such consideration be a price or rental in money, or
1523	1523	by way of exchange or barter.
1524	1524	(10) SALES PRICE. The total amount for which tangible
1525	1525	personal property is sold, including any services, including
1526	1526	transportation, that are a part of the sale, valued in money,
1527	1527	whether paid in money or otherwise, and includes any amount
1528	1528	for which credit is given to the purchaser by the seller,
1529	1529	729
1530	1530	730
1531	1531	731
1532	1532	732
1533	1533	733
1534	1534	734
1535	1535	735
1536	1536	736
1537	1537	737
1538	1538	738
1539	1539	739
1540	1540	740
1541	1541	741
1542	1542	742
1543	1543	743
1544	1544	744
1545	1545	745
1546	1546	746
1547	1547	747
1548	1548	748
1549	1549	749
1550	1550	750
1551	1551	751
1552	1552	752
1553	1553	753
1554	1554	754
1555	1555	755
1556	1556	756 SB257 INTRODUCEDSB257 INTRODUCED
1557	1557	Page 28
1558	1558	without any deduction therefrom on account of the cost of the
1559	1559	property sold, the cost of the materials used, labor or
1560	1560	service cost, interest charged, losses, or any other expenses
1561	1561	whatsoever; provided, that cash discounts allowed and taken on
1562	1562	sales shall not be included and sales price shall not include
1563	1563	the amount charged for property returned by customers when the
1564	1564	entire amount charged therefor is refunded either in cash or
1565	1565	by credit.
1566	1566	(11) IN THIS STATE or IN THE STATE. Within the exterior
1567	1567	limits of the State of Alabama, and includes all territory
1568	1568	within such limits owned by or ceded to the United States of
1569	1569	America.
1570	1570	(12) AUTOMOTIVE VEHICLE. A power shovel, dragline,
1571	1571	crawler, crawler crane, ditcher or any similar machine which
1572	1572	is self-propelled, in addition to self-propelled machines
1573	1573	which are used primarily as instruments of conveyance.
1574	1574	(13) PREPAID TELEPHONE CALLING CARD. A sale of a
1575	1575	prepaid telephone calling card or a prepaid authorization
1576	1576	number, or both, shall be deemed the sale of tangible personal
1577	1577	property subject to the tax imposed pursuant to this chapter.
1578	1578	For purposes of this subdivision, the sale of prepaid wireless
1579	1579	service that is evidenced by a physical card constitutes the
1580	1580	sale of a prepaid telephone calling card, and the sale of
1581	1581	prepaid wireless service that is not evidenced by a physical
1582	1582	card constitutes the sale of a prepaid authorization number.
1583	1583	(14) PREPAID WIRELESS SERVICE. The right to use mobile
1584	1584	telecommunications service, which must be paid for in advance
1585	1585	and that is sold in predetermined units or dollars of which
1586	1586	757
1587	1587	758
1588	1588	759
1589	1589	760
1590	1590	761
1591	1591	762
1592	1592	763
1593	1593	764
1594	1594	765
1595	1595	766
1596	1596	767
1597	1597	768
1598	1598	769
1599	1599	770
1600	1600	771
1601	1601	772
1602	1602	773
1603	1603	774
1604	1604	775
1605	1605	776
1606	1606	777
1607	1607	778
1608	1608	779
1609	1609	780
1610	1610	781
1611	1611	782
1612	1612	783
1613	1613	784 SB257 INTRODUCEDSB257 INTRODUCED
1614	1614	Page 29
1615	1615	the number declines with use or the expiration of time in a
1616	1616	known amount, and which may include rights to use
1617	1617	non-telecommunications services or to download digital
1618	1618	products or digital content. For purposes of this subdivision,
1619	1619	mobile telecommunications service has the meaning ascribed by
1620	1620	Section 40-21-120.
1621	1621	(15) REMOTE USE TAX. Amounts collected from out of
1622	1622	state vendors who, on October 1, 2012, were or would have been
1623	1623	remote sellers as defined in Section 40-23-171; and amounts
1624	1624	remitted by consumers on the individual tax return.
1625	1625	(16) FOOD. Food as defined in 7 U.S.C § 2011, et seq.,
1626	1626	for the purposes of the federal Supplemental Nutrition
1627	1627	Assistance Program regardless of where or by what means food
1628	1628	is sold. In the event that the federal Supplemental Nutrition
1629	1629	Assistance Program definition no longer exists, the
1630	1630	Legislature shall provide a new definition of "food" by
1631	1631	general law."
1632	1632	"§40-23-61
1633	1633	(a) An excise tax is hereby imposed on the storage, use
1634	1634	or other consumption in this state of tangible personal
1635	1635	property, not including, however, materials and supplies
1636	1636	bought for use in fulfilling a contract for the painting,
1637	1637	repairing or reconditioning of vessels, barges, ships, other
1638	1638	watercraft and commercial fishing vessels of over five tons
1639	1639	load displacement as registered with the U.S. Coast Guard and
1640	1640	licensed by the State of Alabama Department of Conservation
1641	1641	and Natural Resources, purchased at retail on or after October
1642	1642	1, 1965, for storage, use or other consumption in this state
1643	1643	785
1644	1644	786
1645	1645	787
1646	1646	788
1647	1647	789
1648	1648	790
1649	1649	791
1650	1650	792
1651	1651	793
1652	1652	794
1653	1653	795
1654	1654	796
1655	1655	797
1656	1656	798
1657	1657	799
1658	1658	800
1659	1659	801
1660	1660	802
1661	1661	803
1662	1662	804
1663	1663	805
1664	1664	806
1665	1665	807
1666	1666	808
1667	1667	809
1668	1668	810
1669	1669	811
1670	1670	812 SB257 INTRODUCEDSB257 INTRODUCED
1671	1671	Page 30
1672	1672	at the rate of four percent of the sales price of such
1673	1673	property or the amount of tax collected by the seller,
1674	1674	whichever is greater; provided, however, when the seller
1675	1675	follows the Department of Revenue's suggested use tax brackets
1676	1676	and his records prove that his following said brackets
1677	1677	resulted in a net undercollection of tax for the month, he may
1678	1678	report the tax due or tax collected, whichever is less, except
1679	1679	as provided in subsections (b) and (c) of this section.
1680	1680	(b) An excise tax is hereby imposed on the storage, use
1681	1681	or other consumption in this state of any machines used in
1682	1682	mining, quarrying, compounding, processing and manufacturing
1683	1683	of tangible personal property, purchased at retail on or after
1684	1684	October 1, 1965, at the rate of one and one-half percent of
1685	1685	the sales price of any such machine or the amount of tax
1686	1686	collected by the seller, whichever is greater; provided,
1687	1687	however, when the seller follows the Department of Revenue's
1688	1688	suggested use tax brackets and his records prove that his
1689	1689	following said brackets resulted in a net undercollection of
1690	1690	tax for the month, he may report the tax due or tax collected,
1691	1691	whichever is less; provided, that the term "machine," as
1692	1692	herein used, shall include machinery which is used for mining,
1693	1693	quarrying, compounding, processing, or manufacturing tangible
1694	1694	personal property, and the parts of such machines, attachments
1695	1695	and replacements therefor, which are made or manufactured for
1696	1696	use on or in the operation of such machines and which are
1697	1697	necessary to the operation of such machines and are
1698	1698	customarily so used.
1699	1699	(c) An excise tax is hereby imposed on the storage, use
1700	1700	813
1701	1701	814
1702	1702	815
1703	1703	816
1704	1704	817
1705	1705	818
1706	1706	819
1707	1707	820
1708	1708	821
1709	1709	822
1710	1710	823
1711	1711	824
1712	1712	825
1713	1713	826
1714	1714	827
1715	1715	828
1716	1716	829
1717	1717	830
1718	1718	831
1719	1719	832
1720	1720	833
1721	1721	834
1722	1722	835
1723	1723	836
1724	1724	837
1725	1725	838
1726	1726	839
1727	1727	840 SB257 INTRODUCEDSB257 INTRODUCED
1728	1728	Page 31
1729	1729	or other consumption in this state of any automotive vehicle
1730	1730	or truck trailer, semitrailer or house trailer, and mobile
1731	1731	home set-up materials and supplies including but not limited
1732	1732	to steps, blocks, anchoring, cable pipes and any other
1733	1733	materials pertaining thereto, purchased at retail on or after
1734	1734	October 1, 1965, for storage, use or other consumption in this
1735	1735	state at the rate of two percent of the sales price of such
1736	1736	automotive vehicle, truck trailer, semitrailer or house
1737	1737	trailer, and mobile home set-up materials and supplies as
1738	1738	specified above, or the amount of tax collected by the seller,
1739	1739	whichever is greater; provided, however, when the seller
1740	1740	follows the Department of Revenue's suggested use tax brackets
1741	1741	and his records prove that his following said brackets
1742	1742	resulted in a net undercollection of tax for the month, he may
1743	1743	report the tax due or tax collected, whichever is less. Where
1744	1744	any used automotive vehicle or truck trailer, semitrailer or
1745	1745	house trailer is taken in trade, or in a series of trades, as
1746	1746	a credit or part payment on the sale of a new or used vehicle,
1747	1747	the tax levied herein shall be paid on the net difference,
1748	1748	that is, the price of the new or used vehicle sold less the
1749	1749	credit for the used vehicle taken in trade.
1750	1750	Of the total $.02 tax on each dollar of sale provided
1751	1751	hereunder, 58 percent of the total tax generated by this
1752	1752	subsection shall be deposited to the credit of the Education
1753	1753	Trust Fund; and 42 percent of the total tax generated by this
1754	1754	subsection shall be deposited to the credit of the State
1755	1755	General Fund.
1756	1756	(d) An excise tax is hereby imposed on the storage, use
1757	1757	841
1758	1758	842
1759	1759	843
1760	1760	844
1761	1761	845
1762	1762	846
1763	1763	847
1764	1764	848
1765	1765	849
1766	1766	850
1767	1767	851
1768	1768	852
1769	1769	853
1770	1770	854
1771	1771	855
1772	1772	856
1773	1773	857
1774	1774	858
1775	1775	859
1776	1776	860
1777	1777	861
1778	1778	862
1779	1779	863
1780	1780	864
1781	1781	865
1782	1782	866
1783	1783	867
1784	1784	868 SB257 INTRODUCEDSB257 INTRODUCED
1785	1785	Page 32
1786	1786	or other consumption in this state of food as defined in
1787	1787	Section 40-23-60, at the rate of four percent of the sales
1788	1788	price of such food. Beginning September 1, 2023, the tax rate
1789	1789	shall be reduced to three and one-half percent. On November 1,
1790	1790	2024, and on November 1 of every year thereafter until the tax
1791	1791	rate is two percent, the tax rate shall be reduced by one-half
1792	1792	of one percent. Provided, however, the rate of tax shall only
1793	1793	be reduced if the growth in total net receipts from all
1794	1794	revenue sources to the Education Trust Fund in the preceding
1795	1795	fiscal year was at least two percent more than the prior
1796	1796	fiscal year.
1797	1797	(d)(e) Every person storing, using or otherwise
1798	1798	consuming in this state tangible personal property purchased
1799	1799	at retail shall be liable for the tax imposed by this article,
1800	1800	and the liability shall not be extinguished until the tax has
1801	1801	been paid to this state; provided, that a receipt from a
1802	1802	retailer maintaining a place of business in this state or a
1803	1803	retailer authorized by the department, under such rules and
1804	1804	regulations as it may prescribe, to collect the tax imposed
1805	1805	hereby and who shall for the purpose of this article be
1806	1806	regarded as a retailer maintaining a place of business in this
1807	1807	state, given to the purchaser in accordance with the
1808	1808	provisions of Section 40-23-67, shall be sufficient to relieve
1809	1809	the purchaser from further liability for tax to which such
1810	1810	receipt may refer.
1811	1811	(e)(f) An excise tax is hereby imposed on the classes
1812	1812	of tangible personal property, and at the rates imposed on
1813	1813	such classes, specified in subsections (a), (b) and (c) of
1814	1814	869
1815	1815	870
1816	1816	871
1817	1817	872
1818	1818	873
1819	1819	874
1820	1820	875
1821	1821	876
1822	1822	877
1823	1823	878
1824	1824	879
1825	1825	880
1826	1826	881
1827	1827	882
1828	1828	883
1829	1829	884
1830	1830	885
1831	1831	886
1832	1832	887
1833	1833	888
1834	1834	889
1835	1835	890
1836	1836	891
1837	1837	892
1838	1838	893
1839	1839	894
1840	1840	895
1841	1841	896 SB257 INTRODUCEDSB257 INTRODUCED
1842	1842	Page 33
1843	1843	this section, on the storage, use, or other consumption in the
1844	1844	performance of a contract in this state of any such tangible
1845	1845	personal property, new or used, the tax to be measured by the
1846	1846	sales price or the fair and reasonable market value of such
1847	1847	tangible personal property when put into use in this state,
1848	1848	whichever is less; provided, that the tax imposed by this
1849	1849	subsection shall not apply where the taxes imposed by
1850	1850	subsection (a), (b), or (c) of this section apply."
1851	1851	Section 2. (a) On the effective date of this act, the
1852	1852	definition of "food" in Sections 40-23-1 and 40-23-60, Code of
1853	1853	Alabama 1975, shall apply to county and municipal sales and
1854	1854	use taxes. For purposes of county and municipal sales and use
1855	1855	taxes, the sales tax rate on food shall be established as the
1856	1856	general or retail sales tax rate in effect in the county or
1857	1857	municipality on the effective date of this act, unless
1858	1858	otherwise provided by law. An act of the Legislature or an
1859	1859	ordinance or resolution adopted by a county or municipal
1860	1860	governing body levying a county or municipal sales and use tax
1861	1861	inclusive of food passed or enacted on or before the effective
1862	1862	date of this act shall remain operative, but no additional
1863	1863	county or municipal sales and use taxes on food may be levied.
1864	1864	(b) Any county or municipal governing body may, by
1865	1865	resolution or ordinance, reduce the general or retail sales
1866	1866	tax rate on food for local sales and use taxes. Such ordinance
1867	1867	or resolution must be adopted at least 60 days prior to
1868	1868	becoming effective.
1869	1869	Section 3. This act shall become effective on September
1870	1870	1, 2023, following its passage and approval by the Governor,
1871	1871	897
1872	1872	898
1873	1873	899
1874	1874	900
1875	1875	901
1876	1876	902
1877	1877	903
1878	1878	904
1879	1879	905
1880	1880	906
1881	1881	907
1882	1882	908
1883	1883	909
1884	1884	910
1885	1885	911
1886	1886	912
1887	1887	913
1888	1888	914
1889	1889	915
1890	1890	916
1891	1891	917
1892	1892	918
1893	1893	919
1894	1894	920
1895	1895	921
1896	1896	922
1897	1897	923
1898	1898	924 SB257 INTRODUCEDSB257 INTRODUCED
1899	1899	Page 34
1900	1900	or its otherwise becoming law.925