Rick Brown: Close the Gap; Boost #ShopAlabama

This holiday season join the movement. #ShopAlabama

That is how I ended this column in the November 2016 issue of Alabama Retailer magazine.

Alabama’s retailers had reason to celebrate that year because for the first time, some of the world’s largest online-only retailers would collect and remit tax on Alabama purchases during the busiest shopping time of the year.

Since Alabama’s Simplified Seller Use Tax Remittance Act took effect, remote sellers without a retail presence in Alabama have been collecting a flat 8-percent use tax from our residents.

That law, then an economic nexus rule and ultimately a U.S. Supreme Court decision brought us closer to tax parity for all purchases, whether purchased in or from an Alabama store or online from a seller with no ties to our state.

Remote sellers, who had been collecting and remitting NO taxes in Alabama, finally had to add tax to the purchase price. It was great news for brick-and-mortar retailers.

Alabama retailers welcomed the challenge to reclaim or gain customers. All they wanted was a level playing field.

Fast forward to 2024, the average combined state, county and city sales tax rate in Alabama is about 9.3%. In many places, local stores must collect 10% tax on every purchase.

Brick-and-mortar stores must add 1% to 2% more to every purchase than the 9,240 remote sellers now remitting a flat 8% tax to our state. That puts Alabama retailers at a competitive price disadvantage.

Let’s work to close that gap. Advocate for a rate that reflects the average sales tax rate in Alabama. The current rate encourages Alabama consumers to buy from remote online sellers rather than from your local stores. Ask your Alabama lawmakers to find a way to close the gap and join the #ShopAlabama movement.

Rick Brown
President, Alabama Retail Association

Find this column on Page 2
of the November 2024 Alabama Retailer.