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Alabama Sales Tax

On this page you will find handy sales and use tax information about Alabama.

How to use this page:

We’ve pulled in the information from all our Charts for a consolidated view by state.  Here you can see the sales tax rates and if the state has remote seller nexus rules. You can also see any sales tax holidays or amnesty programs that may exist, though these do not apply to all states.

Below the chart you can find any News & Tip item we have published that relates to Alabama that you can filter by topic. This will help you get informed on current and past legislation that has passed in the state.

State Sales Tax Rates
State Rate

4.000%
Range of Local Rates

0% – 9.0% Some local jurisdictions do not impose a sales tax.
Local Rates Apply to Use Tax

Yes/No  Some of the cities and counties do apply use tax.
Remote Seller Nexus Rules
AFFILIATE NEXUS

8/24/2012
REPORTING REQUIREMENTS

7/1/2017
ECONOMIC NEXUS

10/1/2018 – see state notice
MARKETPLACE NEXUS

1/1/2019
Sales Tax Holidays
Severe Weather Sales Tax Holiday

February 20, 2026 - February 22, 2026

No state sales or use tax is due on certain items you may purchase to deal with severe weather (Act 2012-256, Rule 810-6-3-.66). See here for the counties and municipalities that have notified ALDOR of their decision to participate or not participate in the holiday.
Back to School Sales Tax Holiday

July 17, 2026 - July 19, 2026

1. Clothing for $156 or less per article
2. Computers, computer software, and school computer supplies with sales price of $1,173 or less
3. Books with a sales price of $47 or less
4. School supplies, school art supplies, and school instructional material with sales price of $78 or less
Click here for a quick reference sheet of exempt items.
Grocery Tax Holiday

May 1, 2026 – June 30, 2026

Removes the 2% state-level sales tax on food. The suspension applies only to the state portion, meaning local city/county taxes may still apply. For more information, click here.
Sales Tax Amnesty
Status

Inactive

Amnesty Filing Dates

June 30, 2016 - August 30, 2016

Go to Alabama Amnesty Page
AMNESTY INCLUSION PERIODS

Taxes due prior to January 1, 2015 or taxes for taxable periods that began before January 1, 2015 are eligible.

TAX TYPES AND CONDITIONS

All taxes administered by the Alabama Department of Revenue, except for motor fuel taxes and certain penalties
AMNESTY BENEFITS

50% of interest and all penalties waived.

Status

Inactive

Amnesty Filing Dates

July 1, 2018 - September 30, 2018

Go to Alabama Amnesty Page
AMNESTY INCLUSION PERIODS

Taxes due prior to January 1, 2017 and taxes for taxable periods that began before January 1, 2017.

TAX TYPES AND CONDITIONS

All taxes administered by the Alabama Department of Revenue except for motor fuel, motor vehicle, and property taxes.
AMNESTY BENEFITS

Waiver of penalties and interest. However, penalties may be imposed for reasons such as failing to comply with the amnesty provisions, providing false or fraudulent information, and/or cost of collection penalties.

Status

Active

Amnesty Filing Dates

Amnesty is provided to any eligible seller who applies and is accepted to participate in the Simplified Seller’s Use Tax (SSUT) Program

Go to Alabama Amnesty Page
AMNESTY INCLUSION PERIODS

Periods preceding October 1, 2019

TAX TYPES AND CONDITIONS

Simplified sellers use tax. Seller must apply for and be accepted into SSUT program. Amnesty isn’t available to any eligible seller who has received notice of an audit and the audit is not yet resolved.  Amnesty only applies to retailers responsible for collection of the tax and not for purchasers subject to consumer’s use tax.
AMNESTY BENEFITS

Waiver of penalties and interest, and no class action may be brought against an eligible seller in any court of this state on behalf of customers for an overpayment of simplified sellers use tax.

Administration Information
Streamlined Sales Tax Status

Advisory State
NUMBER OF TAXING AUTHORITIES

801 Sales Tax Jurisdictions

HOME RULE AUTHORITIES

Yes – Combination; some are state administered
Sales Tax Sourcing (Intrastate)

Destination
Sales Tax Return Due Date

The 20th of the month following the reporting period
Exemption Information
RESALE CERTIFICATE

Alabama Resale Certificate
TYPES OF EXEMPTIONS

Product types of exemptions: prescription drugs, gasoline and motor oil, fertilizer, seeds, livestock feed, labor to repair or install property if billed separately

 

Entity types of exemptions:  sales to the government, schools, city and county owned hospitals, and specific nonprofits,

 

Alabama Exemption Certificate Forms
State Links
State Tax Web Page

Alabama Department of Revenue
Rate Look-Up Page

Alabama Sales Tax Rate Look-Up
Registration Link

Register for Alabama Sales Tax
History & Fun Facts
HISTORY

Alabama enacted its sales and use tax in 1936. It was re-enacted twice, once in 1939 and again in 1959.
FUN FACTS
  • Alabama is one of the five states with the highest combined state and local tax rates in 2022, at 9.24%.

Multistate Tax Commission Announces Tax Amnesty Program for Online Sellers

The MTC organized a tax amnesty program for online sellers, running from August 17 to November 1, 2017. The voluntary disclosure program allowed sellers to start remitting sales tax on future sales without penalty or liability for unpaid, prior accumulated sales tax in 25 participating states.

Alabama Issues Notice on Changes to Simplified Sellers Use Tax Law

Effective July 1, 2017, the Alabama Department of Revenue can initiate monthly distributions of the Simplified Sellers Use Tax collections to the localities, and disclose names of eligible sellers.

No Regulation Without Representation Act of 2017 Introduced

Under the proposed House bill, a state may tax or regulate a person’s activity in interstate commerce only when the person is physically present in the state during the period in which the tax or regulation is imposed.

Congress Introduces Marketplace Fairness Act of 2017 and Remote Transactions Parity Act of 2017

Introduced on April 27, 2017, the Marketplace Fairness Act of 2017, if enacted, would authorize states meeting certain requirements to require remote sellers that do not meet a small seller exception to collect their state and local sales and use taxes.

Alabama Enacts Use Tax Notice and Reporting Requirements Legislation

On March 22, 2017, the Alabama Department of Revenue was authorized to require non-collecting remote sellers to remote Alabama sales to the DOR and notify Alabama customers of their use tax obligations.

Online Sales Simplification Act of 2016 Discussion Draft is Introduced

The proposed legislation would implement a “hybrid origin” approach for remote sales. States could impose sales tax on remote sales if the origin state participates in a clearinghouse.

No Regulation Without Representation Act of 2016 Introduced

Taking the opposite approach of the Marketplace Fairness Act and Remote Transactions Parity Act, the proposed bill would limit the ability of states to require remote sellers to collect use tax. However, the bill failed to pass.

Out of State Book Retailer Subject to Use Tax in Alabama

Alabama held that an out-of-state retailer that sold books and educational materials was subject to Alabama use tax since the taxpayer had sufficient contacts or nexus in Alabama to require it to collect, report, and remit use tax.

Freight and Transportation Charges Paid by Purchaser Not Taxable in Alabama

Alabama held that freight and transportation charges paid by purchaser were not subject to sales tax. More…

Congress Approves Permanent Extension of Internet Tax Freedom Act

Congress approved a permanent extension of the Internet Tax Freedom Act, signed into law by the President 02/24/16. More…

Internet Tax Freedom Act Extended Through October 1, 2016

The President signed an act to extend the Internet Tax Freedom Act through 10/01/16. More…

Exempt Entities Required to Obtain Exemption Certificates Annually in Alabama

Alabama requires tax exempt entities to obtain exemption certificates annually, effective 01/01/16. More…

Alabama Enacts 2016 Tax Amnesty Program

Alabama announced the state’s 2016 tax amnesty program, running 06/30/16 through 08/30/16. More…

Internet Tax Freedom Act Extended Until December 11, 2015

U.S. House of Representatives passed a provision to extend the Internet Tax Freedom Act until 12/11/15. More…

Alabama Enacts Economic Nexus Provision

Alabama enacted a new economic nexus rule applying to out-of-state sellers, effective 10/22/15. More…

House Introduces Remote Transactions Parity Act of 2015

U.S. House of Representatives introduced the Remote Transactions Parity Act of 2015 on 06/15/15. More…

Alabama Adopts Rule for Taxability of Prepaid Wireless Services

Alabama adopted a new sales and use tax rule on sales of prepaid wireless service, effective 03/27/15. More…

U. S. Supreme Court Rules that Rail Carrier’s Competitors are Comparison Class in Discrimination Claim

The U.S. Supreme Court found that motor and water carriers are an appropriate comparison in a claim that Alabama’s sales tax treatment is discriminatory in violation of the 4-R Act.

Senate Introduces Marketplace Fairness Act of 2015

On March 10, 2015, a bipartisan group of senators introduced the Marketplace Fairness Act of 2015.

Internet Tax Freedom Act Extended Until October 1, 2015, Permanent Extension Introduced

On December 16, 2014, President Barack Obama signed an act including a provision that extends the Internet Tax Freedom Act until October 1, 2015.

Internet Tax Freedom Act is Extended through December 11, 2014

President Barack Obama has signed federal legislation extending the Internet Tax Freedom Act through December 11, 2014.

Alabama Adopts New Local Nexus Rule

Alabama has adopted a new nexus rule outlining a business’s obligation to collect and remit local (county and municipal) sales and use tax, whether or not that business has a permanent physical location in the state. The rule will apply…

New Federal Digital Goods and Services Bill Proposed

Representative Lamar Smith (Republican, Texas) has introduced a bill to bar multiple taxes on digital goods and services. Smith had proposed an earlier bill which failed to pass. This bill is a revised version of the earlier bill. The proposed…

Federal Government Introduces New Remote Seller Bill

The federal Marketplace Fairness Act of 2013 was introduced in the House of Representatives and the Senate on February 14, 2013.