State Sales & Use Tax Rates

Contractors Gross Receipts Tax Rate (40-23-50(a))

5% of gross receipts derived from performance of contracts to construct, reconstruct or build any public highway, road, bridge or street.

Dry Cleaning Environmental Response Trust Fund Registration Fees

Type of Business	Fee
Owner/Operator of an Existing Dry Cleaning Facility Electing to be Covered (22-30D-6(a))	2% of the gross receipts earned in Alabama during the prior calendar year, not to exceed $25,000 per year.
New Owner/Operator Acquiring an Existing Dry Cleaning Facility after 5/24/00 Electing to be Covered (22-30D-6(b))	2% of the gross receipts earned in Alabama by the prior owner/operator during the prior calendar year less the amount paid by prior owner/operator, not to exceed $25,000.
New Owner/Operator Establishing a New Dry Cleaning Facility after 5/24/00 Electing to be Covered (22-30D-6(c))	One-time registration fee of $5,000 for the first year of operation; for the second year of operation, the greater of $5,000 or 2% of the gross receipts earned for prior calendar year, not to exceed $25,000. For each year thereafter, see “Owner/Operator of an Existing Dry Cleaning Facility” above.
Wholesale Distributors of Dry Cleaning Agents (22-30D-6(d))	$5,000 per year
Owner of Abandoned Dry Cleaning Facility or Impacted Third Party (22-30D-6(m))	$5,000 per year per site

Health Care

Alabama Nursing Facilities Privilege Tax Rates (40-26B-21(a) & (b))

• Annual rate of $1,200.00 for each bed in the facility (for periods prior to June 2004.)
• Annual rate of $1,899.96 for each bed in the facility (Effective 6/1/04 per Act No. 2004-532.For June 2004 – August 2010 returns.)
• Annual rate of $2,963.04 for each bed in the facility (Effective 9/1/10 per Act No. 2010-520.Beginning with the September 2010 return.)
• Annual rate of $3,503.04 for each bed in the facility (Effective 9/1/11 per Act No. 2011-614. Beginning with the September 2011 return.)
• Annual rate of $4,028.04 for each bed in the facility (Effective 9/1/12 per Act No. 2012-536. Beginning with the September 2012 return.)
• Annual rate of $4,429.32 for each bed in the facility (Effective 10/1/15 per Act No. 2015-536. Beginning with the October 2015 return.)

Hospital Assessment For Medicaid Tax Rates (40-26B-72 & 40-2A7(a)(5))

Effective Date	Tax Rate
October 1, 2018	5.75% of the hospital’s net patient revenue. Privately operated hospitals in the state of Alabama that are funded through the Alabama Medicaid program are taxed according to their net patient revenue. The assessment is a cost of doing business as a privately operated hospital in the State of Alabama. Assessment amounts are to be paid in equal quarterly installments by the fifteenth working day of each quarter.
October 1, 2014 – September 2018	5.5% of the hospital’s net patient revenue. Privately operated hospitals in the state of Alabama that are funded through the Alabama Medicaid program are taxed according to their net patient revenue. The assessment is a cost of doing business as a privately operated hospital in the State of Alabama. Assessment amounts are to be paid in equal quarterly installments by the tenth working day of each quarter.

Pharmaceutical Provider Tax Rates

Effective Date	Tax Rate
June 17, 2016 – Present	$0.10 cents for each prescription filled or refilled for a citizen of Alabama (per 40-26B-2).
September 1, 2015 – June 16, 2016	$0.25 cents (Effective 9/1/15 per Act No. 2015-537, a supplemental tax was levied in addition to the $0.10 cents plus already imposed for each prescription filled or refilled for a citizen of Alabama. The total $0.25 cent rate was effective for prescriptions filled between September 1, 2015 &June 16, 2016.)
July 1, 2002 – August 31, 2015	$0.10

Sales, Use, Rental and Lodgings Tax Rates

Lodgings Tax Rates

• Alabama Mountain Lakes Area 40-26-1(a):  5%   Includes the following Counties: Blount, Cherokee, Colbert, Cullman, DeKalb, Etowah, Franklin, Jackson, Lauderdale, Lawrence, Limestone, Madison, Marion, Marshall, Morgan and Winston.
• All Other Alabama Counties 40-26-1(a):  4%

Click here for State Lodgings Tax Codes

Rental or Leasing Tax Rates

• General/Other (40-12-222):  4%
• Automotive (40-12-222):  1.5%
• Linens/Garments:  2%

Sales & Use Tax Rates

• General(40-23-2(1) & 40-23-61(a)):  4%
• Automotive (40-23-2(4) &40-23-61(c)):  2%
• Manufacturing (40-23-2(3) and 40-23-61(b)):  1.5%
• Farm Machinery 40-23-37 &40-23-63):  1.5%
• Vending through Vending Machines:  3%
• Vending (not machines) Sales & Use (40-23-2(5)):  4%
• Amusement Sales & Use (40-23-2(2)):  4%

Telecommunications

Mobile Telecommunications Service Tax Rates (40-21-121(a) & (Act # 2001-1090))

6% of gross sales or gross receipts from monthly charges from the furnishing of mobile telecommunications service and mobile radio communication services.

Prepaid Wireless 9-1-1 Charge (Act 2012-293)

• August 1, 2014 – Present:  $1.75
• October 1, 2013 – July 31, 2014:  $1.60
• September 1, 2012 – September 30, 2013:  $ .70

Utilities

Hydroelectric Kilowatt Hour Tax Rates (40-21-56)

2/5 mill on each kilowatt hour of hydroelectric power manufactured and sold.

2.2% Utility License Tax Rates (40-21-53(a))

2.2% of each dollar of gross receipts from each entity operating a public utility (hydroelectric, railroads express companies, telephone and telegraph companies excepted).

Utility Gross Receipts Tax & Utility Service Use Tax Rates

Electricity, Domestic Water, and Natural Gas Services (40-21-82(a) & 40-21-102(a)

Monthly Gross Sales or Gross Receipts	Tax
Not over $40,000.00	4% of such gross sales or gross receipts
Over $40,000.00 but not over $60,000.00	$1,600.00 plus 3% of excess over $40,000.00
Over $60,000.00	$2,200.00 plus 2% of excess over $60,000.00

Telephone and Telegraph Services Tax Rates (40-21-82(b) & 40-21-102(b) (Act #2001-1090)

• Bills dated on or after 4/1/02:  6% of all gross sales or gross receipts
• Bills dated prior to 4/1/02 less than $60,000.006:  7% of such gross sales or gross receipts
• Bills dated prior to 4/1/02 over $60,000.00:  $4,020.00 plus 3.7% of excess over $60,000.00

Interest Rates by Calendar Quarter

Formula example: 5% ÷ 365 = daily rate x No. of days late x tax = interest due

 

Year	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr
2018	4%	5%	5%	5%
2017	4%	4%	4%	4%
2016	3%	4%	4%	4%
2015	3%	3%	3%	3%
2014	3%	3%	3%	3%
2013	3%	3%	3%	3%
2012	3%	3%	3%	3%
2011	3%	4%	4%	3%
2010	4%	4%	4%	4%
2009	5%	4%	4%	4%
2008	7%	6%	5%	6%
2007	8%	8%	8%	8%
2006	7%	7%	8%	8%
2005	5%	6%	6%	7%
2004	4%	5%	4%	5%
2003	5%	5%	5%	4%
2002	6%	6%	6%	6%
2001	9%	8%	7%	7%
2000	8%	9%	9%	9%
1999	7%	8%	8%	8%
1998	9%	8%	8%	8%
1997	9%	9%	9%	9%
1996	9%	8%	9%	9%
1995	9%	10%	9%	9%
1994	7%	7%	8%	9%
1993	7%	7%	7%	7%
1992	9%	8%	8%	7%

According to Section 40-1-44 of the Code of Alabama 1975, the Alabama Department of Revenue will calculate interest on underpayments and overpayments (where applicable) at the same annual rate, with the exception of land sold by the state for taxes, which shall be calculated at 12% as provided for under Section 40-5-9.