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Consumers Use Tax

The consumers use tax is imposed on tangible personal property brought into Alabama for storage, use, or consumption in the state when the seller did not collect seller’s use tax on the sale of the property.

State consumers use tax rates

See State Tax Rates 

  • 1.5% of the net difference paid for farm machinery; this rate also applies to the gross receipts from sales of machines, parts, and attachments for machines used in manufacturing, processing, compounding, mining, and quarrying tangible personal property.
  • 2% of the net difference paid for new and used automotive vehicles, truck trailers, semi-trailers, and manufactured homes.
  • 4% of the gross proceeds of sales of all tangible personal property, other than that listed previously and specifically exempted by law.

When is the consumers use tax due?

The tax rates due are the same rates as for sales tax. The tax is due monthly, with returns and remittances to be filed on or before the 20th day of the month following the month in which the purchase was made. However, pursuant to Section 40-23-7, Code of Alabama 1975, you may request quarterly filing status if you have a tax liability of less than $2,400.00 for the preceding calendar year.  You may request bi-annual filing if you have a tax liability of less than $1,200 for the preceding calendar year.  You may also request bi-annual filing if you have purchases subject to consumer’s use tax during no more than two thirty consecutive day periods during the preceding calendar year.  You may request annual filing status if the tax liability for the entire preceding calendar year is less than $600.00.  You may also request annual filing if you have purchases subject to consumer’s use tax during no more than one thirty consecutive day period during the preceding calendar year.  Changes to the filing status can only be requested each year before February 20th in order to file quarterly, bi-annually or annually for that calendar year.   The tax rates due are the same rates as for State sales tax. There may also be city and/or county consumers use tax due; these rates vary. Note: If paying via EFT, the EFT payment information must be transmitted by 4:00 p.m. (Central Standard Time) on or before the due date, to be considered timely paidLearn more 

If the 20th falls on a weekend or holiday, when is the due date?

The return must be submitted on or before the next working day to be timely filed.

Is the seller allowed a discount for timely filing and paying the sales tax due?

No discounts apply for timely filing.

Is there a penalty imposed for not timely filing and paying the sales tax due?

Yes. Penalty and interest is due if the tax is paid after the 20th day of the month in which the tax is due. The Failure to Timely File Penalty is 10% of the tax required to be paid or $50.00, whichever is greater. The Failure to Timely Pay Penalty is 10% of the tax required to be paid. Interest is due at the current rate. Note: If paying via EFT, the EFT payment information must be transmitted by 4:00 p.m. (Central Standard Time) on or before the due date, to be considered timely paid. View interest rates  Learn more 

Do I need to file a consumers use tax return for a month in which I had no purchases to report?

Yes. Once an account has been established for your business, no matter what type of tax account you have, a tax return must be filed for each month even though no tax is due.

Local Consumers Use Tax

Many cities and counties have use tax requirements patterned after the State law. Purchases from in-state vendors located outside these cities and counties for use within could be subject to their use tax. These rates vary. If a local city or county sales/use tax is paid under a requirement of law, no other additional local tax is due for the subsequent use in another city or county. The local consumers use tax is due monthly, with returns and remittances to be filed on or before the 20th day of the month following the month in which the purchase was made. However, pursuant to Section 40-23-7, Code of Alabama 1975, you may request quarterly filing status if you have a tax liability of less than $2,400.00 for the preceding calendar year.  You may request bi-annual filing if you have a tax liability of less than $1,200 for the preceding calendar year.  You may also request bi-annual filing if you have purchases subject to consumer’s use tax during no more than two thirty consecutive day periods during the preceding calendar year.  You may request annual filing status if the tax liability for the entire preceding calendar year is less than $600.00.  You may also request annual filing if you have purchases subject to consumer’s use tax during no more than one thirty consecutive day period during the preceding calendar year.  Changes to the filing status can only be requested each year before February 20th in order to file quarterly, bi-annually or annually for that calendar year.   No discounts apply for timely filing. Note: If paying via EFT, the EFT payment information must be transmitted by 4:00 p.m. (Central Standard Time) on or before the due date, to be considered timely paidSearch Local Tax Rates