More sales-related taxes came into the state of Alabama in the first five months of the pandemic than did in the same period in 2019.
Since the global health crisis began in March and through July, Alabama’s state sales tax collections plus collections remitted through the simplified sellers use tax (SSUT) program grew 7.5% over the same period in 2019*, according to Alabama Revenue Department data released this week.
“The continued growth in sales taxes from businesses within our state and use taxes collected by remote sellers means Alabama’s recovery is real,” said Alabama Retail Association President Rick Brown.
And the signs of recovery don’t stop there. The number of people employed in the state continues to climb, while the number of initial unemployment claims decrease. Once again, retail salesperson ranks as the second most advertised job opening, based on online ads, according to the Alabama Labor Department.
“Retailers along with eating and drinking places continue to employ one in four Alabamians working in the private sector and will as long as businesses can safely remain open,” said Brown.
“Alabama’s economic recovery depends on consumers and workers staying healthy,” he said. “For our state to thrive, businesses must stay open. That means continuing to wash our hands and sanitize frequently, maintain six feet of separation and wear a face covering when in public. Those health practices are particularly important as we enter the Labor Day weekend and football season, especially if we want to finish the year with a strong holiday shopping season.”
State sales tax collections for the month of July were up 6.68% over last year, while collections remitted through the simplified sellers use tax program increased 53.38%, according to the Alabama Department of Revenue’s August abstract posted Wednesday. Together, the combined collections grew 11.46% in July over July 2019.
In June, the sales tax growth rate was 11.32%, while SSUT grew 94.83% with a combined growth rate of 18.27%, based on the July abstract. May collections also grew – sales tax by 8%, SSUT by 94.37% and combined 15.19% over the previous May (See June abstract).
“Sales and the related tax collections continue to grow, but not as fast as they did immediately after the two months when businesses were closed or partially closed and when government relief packages were in play,” said Brown.
The Alabama Revenue Department’s monthly abstract reflects sales tax collections on general merchandise, restaurant and other food service, automobiles, machinery and vending. Collections made through the state’s simplified sellers use tax is a separate line item on the abstract. The Alabama Retail Association combines the two collection sources to get a better indicator of overall taxed spending in our state.
The numbers reported in the monthly abstract include only payments received during a particular month, according to the Alabama Revenue Department.
*As contained in the April, May, June, July and August 2020 abstracts compared to abstracts for those months in 2019.
The Alabama Retail Association represents retailers, the largest private employer in the state of Alabama, before the Alabama Legislature and the U.S. Congress. Through sales of food, clothing, furniture, medicine and more, our 4,300 independent merchant and national company members touch almost every aspect of daily living. Since 1943, we’ve worked to promote what’s best for the retail industry in Alabama. Whether voicing the retail view when public policy is made, educating members about issues that impact them, negotiating rates for benefits and services or communicating the retail story, the Alabama Retail Association and its members are better together.
Nancy King Dennis | 334.551.0643 | 334.868.2195 (c) | 800.239.5423