The Alabama Legislature is threatening to remove the rebate Alabama retailers receive for collecting and remitting Alabama sales taxes in a timely manner. For many Alabama retailers, this change would mean sending $4,800 more each year to the state in taxes.
Alabama, like 27 other states, offers a rebate to retailers for the service of collecting and remitting sales taxes. Alabama’s rebate is 5 percent on the first $100 of sales taxes remitted on or before the 20th of each month, and 2 percent on sales taxes remitted beyond the first $100. A 2001 executive order capped the monthly discounts at $400, no matter the number of locations a retailer operates.
- Let your legislator know that the current discount doesn’t cover your time and expense for collecting sales taxes, but it helps!
- Tell your representative what percentage of your transactions are credit card sales, which cost you from 2 percent to 5 percent every time a card is swiped.
- Ask your representative why they give millions in tax incentives to new companies, but raise taxes on small local businesses in their hometowns?
The House Ways and Means Education Committee is expected to vote on the legislation at its 1:30 p.m. Wednesday, May 6, meeting.