While many expected lawmakers to avoid more complex or controversial issues in an election year, the 2026 Regular Session proved to be anything but quiet. Legislators introduced more than 1,000 bills addressing a wide range of policy areas, many with direct implications for Alabama’s retail industry. From targeted tax relief and payment policy changes to evolving regulations around data privacy, this session reflected both longstanding priorities and new areas of focus.

Here is a look at the most impactful measures, as tracked by the Alabama Retail Association.

HB527 – Enacted
Sponsors: Rep. James Lomax (R-Huntsville) | Sen. Arthur Orr (R-Decatur)
Allows taxpayers to deduct up to $1,000 in qualified overtime pay annually from 2026 through 2028 and establishes a grocery sales tax holiday from May 1 through June 30, suspending the state’s 2% tax on SNAP-defined food items.
Grocery Sales Tax Holiday Effective Immediately
Overtime Deduction Effective October 1, 2026

HB15 – Not Enacted
Sponsor: Rep. Mark Shirey (R-Mobile)
Proposed to exempt optical aids, including eyeglasses and contact lenses prescribed by a licensed physician or optometrist, from state sales and use taxes.

HB85 – Not Enacted
Sponsor: Rep Curtis Travis
Sought to require periodic reappraisal of property for ad valorem tax purposes, limiting reappraisals of Class II and Class III property to no more than every three years and phasing in any assessment increases over a three-year period.

HB87 – Not Enacted
Sponsor: Rep Chris Sells (R-Greenville)
Proposed to exempt the sale of corn for deer feed from state sales and use taxes by adding it to the list of existing agricultural-related exemptions.

HB336 – Not Enacted
Sponsor: Rep. Patrice McClammy (D-Montgomery)
Sought to exempt food from state sales and use taxes.

HB360 – Not Enacted
Sponsor: Rep. Chris Sells (R-Greenville)
Would have established an annual Second Amendment Sales Tax Holiday on the last weekend in August, exempting firearms, ammunition, and related accessories from state sales and use tax.

HB641– Not Enacted
Sponsor: Rep. Marilyn Lands (D-Huntsville)
Proposed to exempt the state-levied ad valorem tax from tangible personal property with a market value over $120,000 for businesses with fewer than 50 employees.

HB647 – Not Enacted
Sponsor: Rep. Mike Shaw (R – Vestavia Hills)
Proposed to exempt food from the state sales and use tax for four years.

SSUT Distribution Bills – Not Enacted
HB434 and HB480 Sponsor: Rep. Chris England (D-Tuscaloosa)
SB36, SB37, and SB347 Sponsor: Sen. Greg Albritton (R-Atmore)
Following a lawsuit by several major Alabama municipalities challenging the SSUT structure and online sales tax revenue distribution, a number of related bills were introduced this session. The lawsuit was later dropped in a good faith effort to address concerns, and the proposed legislation was not moved.

HB545 – Enacted
Sponsors: Rep. Norman Crow (R-Tuscaloosa) | Sen. Jay Hovey (R-Auburn)
In response to the decommissioning of the penny, authorizes the rounding of in-person cash transactions to the nearest five cents while leaving product pricing, sales tax calculations, and electronic payments unchanged.
Effective Immediately

SB221 – Enacted
Sponsors: Sen. Arthur Orr (R-Decatur) | Rep. Chad Robertson (R-Heflin)
Clarifies that credit card transaction fees are exempt for sales and use tax calculations.
Effective September 1, 2026

HB526 – Not Enacted
Sponsor: Rep. Ben Harrison
Would have required entities that employs at least six individuals to accept cash as payment for in-person purchases.

HB585 – Not Enacted
Sponsor: Rep. Jennifer Fidler (R- Fairhope)
Sought to impose a transaction fee on certain outgoing international wire transfers.

HB12 – Not Enacted
Sponsor: Rep. Ernie Yarbrough (R-Trinity)
Would have prohibited employers from making employment decisions or restricting customer access based on an individual’s refusal of certain vaccines, drugs, biologics, or facial coverings for reasons of conscience, including religious convictions.

HB21 – Not Enacted
Sponsor: Patrick Sellers (D-Birmingham)
Sought to establish a new employee leave requirement allowing parents or guardians of school-age children to take up to 48 hours of leave annually to attend school-related activities, using unpaid time or existing paid leave.

HB290 – Not Enacted
Sponsor: Rep Juandalynn Givan (D-Birmingham)
Sought to codify federal requirements into state law for expressing breast milk while on the job.

SB171 – Not Enacted
Sponsor: Sen. Robert Stewart (D-Selma)
Proposed to establish a state minimum wage of $10.00 per hour for any employer with 51 or more employees.

SB327 – Not Enacted
Sponsor: Sen. Robert Stewart (D-Selma)
Sought to revise Alabama’s employee drug and alcohol testing law by requiring employers to provide and post written and verbal notice of testing policies, give at least 10 days’ advance notice of any policy change, and encourage rehabilitation before terminating an employee for a confirmed positive test.

SB9 – Enacted
Sponsors: Sen. Gerald Allen (R-Cottondale) | Rep. A.J. McCampbell (D-Gallion)
Prohibits vaping in most enclosed public spaces under the Alabama Clean Indoor Air Act framework and renames the law the Vivian Davis Figures and Barbara Drummond Clean Indoor Air Act.
Effective October 1, 2026

SB138 – Enacted
Sponsors: Sen Dan Roberts (R-Birmingham) | Rep. Ben Robbins (R-Sylacauga)
Prohibits a franchisor from requiring a franchisee to operate on a day that conflicts with the franchisee’s sincerely held religious beliefs, except in limited circumstances.
Effective June 1, 2026

HB478 – Not Enacted
Sponsor: Rep. Reed Ingram (R-Matthews)
Would have required certain retail establishments to allow customers with qualifying medical conditions to use employee-only restroom facilities.

HB561 | SB148 – Not Enacted
Sponsors: Rep. Jim Carns (R-Birmingham) | Sen. Gerald Allen (R-Cottondale)
Proposed to require municipalities to provide at least 30 days’ notice and a public hearing prior to the adoption or increase of a local tax or license fee.

SB57 – Enacted
Sponsor: Sen. Arthur Orr (R-Decatur) | Rep. Reed Ingram (R-Matthews)
Requires the Alabama Dept of Human Resources to seek a waiver from USDA to prohibit the use of SNAP benefits for the purchase of candy and soda. Definitions of candy and soda can be found here.
Effective October 1, 2026, with implementation no sooner than April 1, 2027

HB31 – Not Enacted
Sponsor: Rep. Reed Ingram (R-Matthews)
Sought to require the Dept of Human Resources to request a waiver to prohibit the purchase of soda, energy drinks, candy and processed desserts with SNAP benefits.

HB44 – Not Enacted
Sponsor: Donna Givens (R-Loxley)
Sought to require the Dept of Human Resources to request a waiver to add hot rotisserie chicken to the definition of eligible food for purposes of SNAP benefits.

HB172 – Not Enacted
Sponsor: Rep. Ben Robbins (R-Sylacauga)
Sought to amend Alabama’s food labeling laws by defining “ingredient,” “artificial ingredient,” and “natural ingredient,” and by prohibiting food products from being labeled as “all natural” or as containing only natural ingredients if they include any artificial ingredient.

HB444 – Not Enacted
Sponsor: Rep. Chip Brown (R-Mobile)
Proposed to expand Alabama’s seafood country-of-origin labeling requirements for food service establishments, authorize random testing by the Dept of Agriculture, update disclosure rules, and maintain existing enforcement authority and graduated penalties.

HB161 – Enacted
Sponsors: Rep. Chris Sells (R-Greenville) | Sen. Clyde Chambliss (R-Prattville)
Requires app store providers to verify users’ ages using commercially available methods and, for minors, to link accounts to a parent or guardian and obtain parental consent for downloads and purchases. ARA worked to secure an amendment clarifying that “in-app purchase” applies only to virtual currency, digital goods, digital services, or other apps, and does not include tangible goods.
Effective January 1, 2027

HB351 – Enacted
Sponsors: Rep. Mike Shaw (R-Vestavia) | Sen. Chris Elliot (R-Josephine)
Establishes a framework for consumer data privacy rights and gives individuals the ability to access, correct, delete, and obtain a copy of their personal data.
Effective May 1, 2027

HB219 – Not Enacted
Sponsor: Rep. Mike Shaw (R-Vestavia Hills)
Would have required app store operators to generate and share age signals with app developers to determine a user’s age category of covered applications.

HB324 and HB325 – Not Enacted
Sponsor: Rep. Parker Moore (R-Hartselle)
Sought to require businesses to disclose when consumers are interacting with an AI chatbot, with failure to do so deemed an unfair or deceptive trade practice.

HB610 – Not Enacted
Sponsor: Rep. Chris Sells (R-Greenville)
Proposed to establish disclosure requirements for automatic renewal or continuous service agreements, requiring clear upfront terms, advance notice of renewal charges, and an easy cancellation method matching the original sign-up process.

HB328 – Enacted
Sponsors: Rep. David Faulkner (R-Birmingham) | Sen. Rodger Smitherman (D-Birmingham)
Expands the definition of first-degree arson to include fires or explosions committed in conjunction with, or to facilitate, a theft.
Effective October 1, 2026

HB481 – Not Enacted
Sponsor: Rep. Chris England (D-Tuscaloosa)
Sought to require that restitution be paid and collected before any other fines, court costs, or fees associated with the case.

HB593 – Enacted
Sponsors: Rep Andy Whitt (R-Ardmore) | Sen. Randy Price (R-Opelika)
Expands Alabama’s existing brewpub framework by creating new license categories for small craft distilleries and wineries and allowing a single manufacturer license for combined operations within a contiguous area. It also permits tours, tastings, and limited off-site sales at public events.
Effective October 1, 2026

SB287 – Enacted
Sponsor: Sen. Kirk Hatcher (D-Montgomery) | Rep. Kenyatte Hassell (D-Montgomery)
Clarifies that licensed importers may bring alcoholic beverages into Alabama from outside the state and aligns the importer license year to begin October 1.
Effective October 1, 2026

HB395 – Not Enacted
Sponsor: Rep. Andy Whitt (R-Ardmore)
Sought to clarify that, for ABC Board wholesale liquor pricing, the “cost of merchandise” used to calculate the markup (currently up to 16.99% plus freight) is limited strictly to the board’s purchase price for case lots of liquor.

HB663 – Not Enacted
Sponsor: Rep. David Faulkner (R-Birmingham)
Would have revised the calculation of the excise tax based on the amount of nicotine in consumable vapor products.

SB1 – Not Enacted
Sponsor: Sen. April Weaver (R-Alabaster)
Proposed that only nonpsychoactive cannabinoids derived from hemp are exempt from the Schedule I controlled substances list, thus classifying psychoactive cannabinoids as controlled substances. It would also restrict ingestible CBD and other nonpsychoactive hemp cannabinoid products to sale only in licensed pharmacies certified by the Alabama State Board of Pharmacy.

SB217 – Not Enacted
Sponsor: Sen. Bobby Singleton (D-Greensboro)
Sought to authorize the retail sale of ready-to-drink mixed spirit beverages containing no more than 7 percent alcohol by volume by creating a new product category and license.

SB234 – Not Enacted
Sponsor: Sen. Tim Melson (R-Florence)
Would have required retailers selling alcoholic beverages, tobacco, vape, or consumable hemp products to use a digital age-verification system or card-swipe technology at the point of sale after a violation for failing to verify a customer’s age.

SB321 – Not Enacted
Sponsor: Sen. Tom Butler (R-Madison)
Sought to repeal the 2025 law regulating the sale of consumable hemp products and instead classify psychoactive cannabinoids derived from hemp, including Delta-8, Delta-9, and Delta-10 THC, as Schedule I controlled substances.

SB100 – Enacted
Sponsors: Sen. Keith Kelley (R-Anniston) | Rep. Kerry Underwood (R-Tuscumbia)
Extends the Alabama State Board of Pharmacy until October 1, 2027, and revise the appointing authority for one at-large board member.
Effective June 1, 2026

HB127 – Not Enacted
Sponsor: Rep. Chip Brown (R-Mobile)
Proposed to prohibit punitive action against pharmacists that recommend or dispense drugs for off-label use. It would also permit over-the-counter sale of both Ivermectin and Hydroxychloroquine.

HB146 – Not Enacted
Sponsor: Rep. Phillip Rigsby (R-Huntsville)
Sought to permit a physician, physician assistant, or nurse practitioner to give a pharmacist a standing order to dispense Ivermectin to individuals without an individual prescription.

HB590 – Not Enacted
Sponsor: Rep. Phillip Rigsby (R-Huntsville)
Would have exempted pharmacies from ABC Board licensing and oversight and instead allow pharmacies permitted by the Alabama Board of Pharmacy to sell consumable hemp products at retail, provided the products meet existing safety standards related to testing, labeling, and packaging.

SB345 – Not Enacted
Sponsor: Sen. Larry Stutts (R-Tuscumbia)
Sought to update terminology in Alabama’s pharmacy benefit manager (PBM) law by replacing the term “independent pharmacy” with “unaffiliated pharmacy.” The term “unaffiliated pharmacy” was defined as a pharmacy that is not a PBM affiliate.

With many of these bills poised to shape the business environment for years to come, staying informed and engaged is more important than ever. The Alabama Retail Association will continue to advocate for pro-retail policies and keep you updated on implementation timelines, regulatory changes, and opportunities to make your voice heard.

If there are specific policies or regulations you’d like us to track or work to change, we’d love to hear from you. Your input helps shape our advocacy efforts and ensures we’re focused on the issues that matter most to our members. Please email Alison Hosp with your policy priorities or areas of concern.

Together, we can ensure Alabama remains a great place to do business.