The fifth week of the 2026 Legislative Session brought steady movement in both committee rooms and on the chamber floors, with several bills of interest to retailers advancing in the process.

Legislation Pulled Following SSUT Lawsuit Withdrawal, New Distribution Bill Introduced
Following the recent decision by several Alabama municipalities to withdraw their lawsuit challenging the state’s Simplified Sellers Use Tax (SSUT) structure, Sen. Greg Albritton, R-Atmore, has pulled SB36 and SB37 from further consideration.

As previously reported, the bills were introduced in response to the pending litigation and would have altered the treatment of municipal sales taxes for purchases made outside a taxpayer’s city of residence. With the lawsuit now dropped in what city leaders described as a good faith effort to work with the Legislature, the measures have been set aside.

However, new legislation addressing the distribution of SSUT proceeds has been introduced in the House. HB434, sponsored by Rep. Chris England, D-Tuscaloosa, would revise the SSUT distribution formula by reducing the portion allocated to the Education Trust Fund and reallocating that share to local boards of education. The bill also adjusts county and municipal distribution percentages and changes the timing of distributions from quarterly to monthly, effective October 1, 2026.

Second Amendment Sales Tax Holiday Clears Committee
Rep. Chris Sells, R-Greenville, filed HB360 to establish a Second Amendment Sales Tax Holiday. If enacted, the annual holiday would take place the last weekend in August and would exempt ammunition, firearms, and firearm accessories from the state sales and use tax. The bill also allows local governments to opt in and provide corresponding local tax relief.

HB360 was approved by the House Ways and Means Education Committee and now advances for consideration by the full House.

Senate Approves Religious Observance Protections for Franchisees
SB138, sponsored by Sen. Dan Roberts, R-Birmingham, would prohibit a franchisor from requiring a franchisee to operate on a day that conflicts with the franchisee’s sincerely held religious beliefs, except under limited circumstances.

During floor debate, discussion centered on the role of government in private business contracts. The sponsor emphasized that the legislation is intended to protect franchise owners from being compelled to operate on religious observance days, particularly in situations where franchise locations are acquired by private equity firms or other entities that may impose new operational requirements. The bill was adopted and now moves to the House for consideration.

Theft-Related Arson Bill Clears House Committee
Rep. David Faulkner, R-Birmingham, introduced HB328 to expand the definition of first-degree arson to include fires or explosions committed in conjunction with, or to facilitate, a theft. The bill was substituted to incorporate technical changes, and it received a favorable report from the House Judiciary Committee. Under current law, first-degree arson is a Class A felony requiring intentional damage to a building by fire or explosion when another person is present and the offender knows of, or recklessly disregards, that person’s safety.

Seafood Country-of Origin Labeling Bill Introduced
HB444, introduced by Rep. Chip Brown, R-Mobile, would expand Alabama’s seafood country-of-origin labeling requirements for food service establishments. The State Health Officer would continue to investigate alleged violations upon receipt of a verified complaint, while the Commissioner of Agriculture and Industries would be authorized to independently test seafood to ensure compliance and report violations for enforcement.

The bill also updates menu and signage disclosure requirements for imported seafood. Violations would remain subject to a graduated penalty structure, and establishments found in violation would see a five-point reduction in their posted health sanitation score during the scoring period. Establishments that unknowingly violate the law based on a supplier’s attestation of origin would be held harmless. The act would take effect October 1, 2026.

Alcohol Age Verification Bill Advances Committee, Substitute Expected
Sen. Tim Melson, R-Florence, has advanced legislation requiring retailers that sell alcoholic beverages, tobacco, vape, or consumable hemp products to implement a digital age verification system or card swipe technology at the point of sale following a violation for failing to verify a customer’s age. The bill passed the Senate Tourism Committee this week. Sen. Melson noted that he is preparing a substitute and expects to have it ready before the bill is taken up by the full Senate.

Bill Filed to Change Alcohol Importing
Sen. Kirk Hatcher, D-Montgomery, introduced SB287 to update Alabama’s alcoholic beverage laws to clarify that a licensed importer may bring into the state alcoholic beverages manufactured anywhere outside of Alabama. Current law references products manufactured outside of the United States, and this bill formally recognizes importers’ authority to distribute domestically produced beverages made outside Alabama to the ABC Board or to licensed wholesalers.

The bill also aligns the importer license year with other ABC license categories by changing it from January 1 to October 1. If enacted, the act would take effect October 1, 2026.

Data Privacy Bill Substituted in Committee
HB351, sponsored by Rep. Mike Shaw, R-Vestavia Hills, was substituted and adopted by the House Commerce and Small Business Committee. The updated bill maintains core consumer rights, including the ability to access, correct, delete, and obtain a copy of personal data, as well as the right to opt out of the sale of personal data, targeted advertising, and certain profiling, while making several key changes.

Following work with stakeholders, the substitute incorporates a later effective date of May 1, 2027, clarifies that the act does not establish any private right of action so enforcement rests solely with the Attorney General, expands certain exemptions, clarifies definitions, and simplifies opt-out provisions. At the Attorney General’s request, the applicability thresholds were also refined. The bill would apply to businesses that conduct business in Alabama and either control or process the personal data of more than 25,000 consumers, excluding data processed solely to complete payment transactions, or derive more than 25 percent of gross revenue from the sale of personal data.

Public Vaping Restrictions Move Forward in House
A bill that would prohibit vaping in public places under the same framework as the Alabama Clean Indoor Air Act passed the House Health Committee. SB9, carried by Rep. Chris England, D-Tuscaloosa, would ban vaping in most enclosed public spaces, including retail stores, restaurants, shopping malls, elevators, banks, and other locations. The bill now moves to the full House for further consideration.