HB105INTRODUCED
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HB105
L3ZCWWW-1
By Representative Lee
RFD: Ways and Means General Fund
First Read: 06-Feb-24
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5 L3ZCWWW-1 12/19/2023 JRF (F)JRF 2023-3588
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First Read: 06-Feb-24
SYNOPSIS:
Under existing law, the state levies a transient
occupancy tax on the furnishing of rooms, lodging, or
accommodations to transients for consideration.
This bill would exclude certain registered
vehicles and vessels from this tax under certain
conditions.
Also under existing law, the state levies a tax
for the lease or rental of certain vehicles. This bill
would exclude certain vehicles and vessels from this
tax under certain conditions.
A BILL
TO BE ENTITLED
AN ACT
Relating to the transient occupancy tax; to amend
Section 40-26-1, Code of Alabama 1975, to exempt certain
registered vehicles and vessels from the transient occupancy
tax under certain conditions; relating to the rental or lease
tax; to amend Section 40-12-223, Code of Alabama 1975, to
exempt certain vehicles and vessels from the rental or lease
tax under certain conditions.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
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BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Sections 40-26-1 and 40-12-223, Code of
Alabama 1975, are amended to read as follows:
"§40-26-1
(a) There is levied and imposed, in addition to all
other taxes of every kind now imposed by law, a privilege or
license tax upon every person, firm, or corporation engaging
in the business of renting or furnishing any room or rooms,
lodging, or accommodations to transients in any hotel, motel,
inn, tourist camp, tourist cabin, marine slip, place or space
for tent camping, place or space provided for a motor home,
travel trailer, self-propelled camper or house car, truck
camper, or similar recreational vehicle commonly known as a
R.V., or any other place in which rooms, lodgings, or
accommodations are regularly furnished to transients for a
consideration, in any county which is located in the
geographic region comprising the Alabama mountain lakes area,
those being Blount, Cherokee, Colbert, Cullman, DeKalb,
Etowah, Franklin, Jackson, Lauderdale, Lawrence, Limestone,
Madison, Marion, Marshall, Morgan, and Winston, in an amount
to be determined by the application of the rate of five
percent of the charge for such room, rooms, lodgings, or
accommodations, including the charge for use or rental of
personal property and services furnished in such room, and the
rate of four percent of the charge in every other county.
There is exempted from the tax levied under this chapter any
rentals or services taxed under Division 1 of Article 1 of
Chapter 23 of this title.
(b) The tax shall not apply to rooms, lodgings, or
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(b) The tax shall not apply to rooms, lodgings, or
accommodations supplied: (i) For a period of 180 continuous
days or more in any place; (ii) by camps, conference centers,
or similar facilities operated by nonprofit organizations
primarily for the benefit of, and in connection with,
recreational or educational programs for children, students,
or members or guests of other nonprofit organizations during
any calendar year; or (iii) by privately operated camps,
conference centers, or similar facilities that provide lodging
and recreational or educational programs exclusively for the
benefit of children, students, or members or guests of
nonprofit organizations during any calendar year.
(c) For purposes of subsection (b): "Children" means
individuals under age 21; "student" is defined in accordance
with 26 U.S.C. § 151(c)(4), as in effect from time to time or
by any successor law; "nonprofit organization" is an
organization exempt from federal income tax under 26 U.S.C. §
501(c)(3), as in effect from time to time or any successor
law; and "privately operated" refers to any camp, conference
center, or similar facility other than those operated by a
nonprofit organization as herein defined.
(d) For transactions entered into on or after
OctoberSeptember 1, 20192024, the tax shall not apply to any
of the following which are supplied for a period of 60
continuous days or more:
(1) Marinemarine slips,.
(2)Placesplaces or spaces for tent camping , or.
(3)Placesplaces or spaces provided for motor homes,
travel trailers, self-propelled campers or house cars, truck
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travel trailers, self-propelled campers or house cars, truck
campers, or similar recreational vehicles commonly known as
R.V.s,.
(4)Any vehicle or vessel required to be registered
pursuant to Title 40 or Title 32, respectively, continuously
occupying any slip, place, or space provided in subdivisions
(1) through (3)which are supplied for a period of 90
continuous days or more in any place .
(e)(1) Charges made for the rental of a ballroom,
dining room, club room, sample room, conference room, wedding
chapel, or similar room or space that is not intended nor
suitable for overnight sleeping purposes and that is not used
for overnight sleeping purposes is not subject to the tax
levied pursuant to this chapter if the charges for the rental
are separately stated by the facility and the room or space is
used exclusively as a room or space for a meeting, conference,
seminar, club meeting, private party, or similar activity.
(2) The exclusion provided in subdivision (1) applies
solely to the transient occupancy tax levied under this
chapter and does not apply to any other taxes, licenses, or
fees except a separately stated rental charge for a meeting
room or other space excluded pursuant to subdivision (1) is
also excluded from the tax levied by Chapter 23 of Title 40."
"§40-12-223
There are exempted from the computation of the amount
of the tax levied, assessed, or payable under this article all
of the following:
(1) The gross proceeds accruing from the leasing or
rental of a film or films to a lessee who charges, or proposes
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rental of a film or films to a lessee who charges, or proposes
to charge, admission for viewing the film or films.
(2) The gross proceeds accruing from any charge in
respect to the use of docks or docking facilities furnished
for boats or other craft operated on waterways.
(3) The gross proceeds accruing from any charge made by
a landlord to a tenant in respect of the leasing or furnishing
of tangible personal property to be used on the premises of
real property leased by the same landlord to the same tenant
for use as a residence or dwelling place, including mobile
homes.
(4) The gross proceeds accruing from the leasing or
rental of tangible personal property to a lessee who acquires
possession of the property for the purpose of leasing or
renting to another the same property under a leasing or rental
transaction subject to this article.
(5) The gross proceeds accruing from any charge made by
a landlord to a tenant in respect to the leasing or furnishing
of tangible personal property to be used on the premises of
any room or rooms, lodging, or accommodations leased or rented
to transients in any hotel, motel, inn, tourist camp, tourist
cabin, or any other place in which rooms, lodgings, or
accommodations are regularly furnished to transients for a
consideration.
(6) The gross proceeds accruing from the leasing or
rental of tangible personal property which the state is
prohibited from taxing under the Constitution or laws of the
United States or under the constitution of the state.
(7) The gross proceeds accruing from the leasing or
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(7) The gross proceeds accruing from the leasing or
rental of nuclear fuel assemblies together with the nuclear
material contained therein and other nuclear material used or
useful in the production of electricity and assemblies
containing ionizing radiation sources together with the
ionizing radiation sources contained therein used or useful in
medical treatment or scientific research.
(8) A transaction in which the lessor leases a truck or
tractor-trailer or semitrailer for operation over the public
roads and highways and such lessor furnishes a driver or
drivers for each vehicle, and the transaction shall be deemed
to constitute the rendition of service and not a "leasing or
rental" within the meaning of this article.
(9) The gross proceeds accruing from the leasing or
rental of vehicles in interchange between regulated motor
carriers on a per diem basis.
(10) The gross proceeds accruing from the leasing or
rental of all structures, devices, facilities, and
identifiable components of any thereof acquired primarily for
the control, reduction, or elimination of air or water
pollution, and the gross proceeds accruing from the leasing or
rental of all materials used or intended for use in structures
built primarily for the control, reduction, or elimination of
air and water pollution.
(11) The gross proceeds derived by the lessor, which
term includes a sublessor, from the leasing or rental of
tangible personal property when the lessor and lessee, which
term includes a sublessee, are wholly-owned subsidiary
corporations of the same parent corporation or one is the
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corporations of the same parent corporation or one is the
wholly-owned subsidiary of the other; provided, that the
appropriate sales or use tax, if any was due, has been paid on
the item of personal property; and provided further, that in
the event of any subsequent subleasing of the tangible
personal property to any person other than any sister, parent,
or subsidiary corporation, any privilege or license tax due
and payable with respect to that subsequent subleasing under
the provisions of this article shall be paid.
(12) The gross proceeds accruing from a transaction
which involves the leasing or rental of vessels or railroad
equipment which are engaged in interstate or foreign commerce,
or both.
(13) The gross proceeds accruing from the leasing or
rental of aircraft, replacement parts, components, systems,
sundries, and supplies affixed or used on the aircraft and all
ground support equipment and vehicles used by or for the
aircraft to or by a certificated or licensed air carrier with
a hub operation within this state, for use in conducting
intrastate, interstate, or foreign commerce for transporting
people or property by air. For the purpose of this
subdivision, the words "hub operation within this state" shall
be construed to have both of the following criteria:
a. There originates from the location 15 or more flight
departures and five or more different first-stop destinations
five days per week for six or more months during the calendar
year.
b. Passengers, property, or both, are regularly
exchanged at the location between flights of the same or a
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exchanged at the location between flights of the same or a
different certificated or licensed air carrier.
(14) The gross proceeds derived by the lessor, which
term includes a sublessor, from the leasing of tangible
personal property under all of the following conditions:
a. Prior to being leased under the lease subject to
this exemption, the leased tangible personal property shall
have been owned, or considered to be owned for either Alabama
or federal income tax purposes or both, or subject to
acquisition pursuant to a binding contract, by the lessee or
by a corporation, partnership, or other entity controlled by,
or under common control with, the lessee.
b. The leased tangible personal property, or the right
to ownership thereof, shall have been acquired by the lessor
from the lessee or a corporation, partnership, or other entity
controlled by, or under common control with, that lessee and
leased back to the lessee under a lease that is considered a
lease and not a sale for either Alabama or federal income tax
purposes, or both, and that has a term of not less than 15
years, except that the lessor and the lessee may agree in the
lease or any subsequent amendment thereof for the termination
of the lease on any date through purchase of the leased
tangible personal property by the lessee, which right to
purchase the property shall be exercisable solely at the
option of the lessee.
c. The appropriate sales or use tax levied by the state
shall have been paid with respect to the acquisition or use of
the leased tangible personal property, or, alternatively, the
acquisition or use of that property shall be exempt by law
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acquisition or use of that property shall be exempt by law
from such sales or use tax.
d. The leased tangible personal property shall be
installed in or about an industrial plant or other real
property that was specially constructed or modified for the
location and use of the tangible personal property and that is
owned, or considered to be owned, for either Alabama or
federal income tax purposes or both, by a corporation,
partnership, or other entity controlled by, or under common
control with, the lessee of such tangible personal property.
e. The leased tangible property shall be used only by a
lessee engaged in the iron and steel industry, and the
exemption from the tax levied by this article shall apply only
to the gross proceeds derived from leases that become binding
contracts of the parties thereto within 180 calendar days
following the date on which the act adding the exemption
contained in this subsection (14) shall become effective.
(15) The gross proceeds accruing from a motor vehicle
lease transaction for a duration of at least 180 days with the
federal government, or any state, county, or municipal entity
within the state, including a public school board or an
individual public school, or any entity eligible for a sales
tax exemption under federal law or Section 40-23-5.
(16) The gross proceeds accruing from the leasing or
rental of a vehicle or vessel exempt from taxation pursuant to
of Section 40-26-1(d). "
Section 2. This act shall become effective on September
1, 2024.
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