Taxation; to exempt certain retail sales of fish or other seafood from sales and use taxes

Plain English Breakdown

The bill text includes an effective date of September 1, 2026 (Section 2), but the provided official metadata explicitly leaves the 'Effective date' field empty. The summary reflects this uncertainty by omitting the specific date from the main action list.

Tax Exemption for Unprocessed Seafood Sold by Producers

This law removes state sales tax on uncooked fish and seafood sold directly to customers by licensed fishermen or boat owners.

What This Bill Does

• Removes the state sales and use tax from retail sales of fish or other seafood that is in its original, unmanufactured state when sold by a producer.
• Defines a 'producer' as a licensed commercial fisherman or an owner of a commercially licensed vessel who holds a license to sell seafood to the public under Section 9-12-125.
• Allows counties and municipalities to choose whether to remove their local sales and use taxes on these same types of seafood sales.

Who It Names or Affects

• Licensed commercial fishermen who sell unprocessed fish or seafood directly to customers.
• Owners of commercially licensed vessels that are also licensed to sell seafood to the public.
• Counties and municipalities in Alabama regarding their local tax rules for these sales.

Terms To Know

Producer

A licensed commercial fisherman or an owner of a commercially licensed vessel that is also licensed to sell seafood directly to the public under Section 9-12-125.

Original or unmanufactured state

Fish or other seafood sold in its natural form without being processed or manufactured, as defined by this act.

Limits and Unknowns

• The tax exemption only applies to fish and seafood in their original, unprocessed condition; it does not cover manufactured or prepared seafood products.
• Local governments are allowed but not required to remove local taxes on these sales, so the rule may vary by county or city.

Official Summary Text

Taxation; to exempt certain retail sales of fish or other seafood from sales and use taxes

Current Bill Text

HB3 ENGROSSED
Page 0
HB3
RBQ71YY-2
By Representative Brown
RFD: Ways and Means Education
First Read: 13-Jan-26
PFD: 25-Jun-25
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HB3 Engrossed
Page 1
PFD: 25-Jun-25
A BILL
TO BE ENTITLED
AN ACT
Relating to taxation; to provide an exemption from the
state sales and use tax for certain retail sales of fish or
other seafood; and to provide for counties and municipalities
to exempt these sales from local sales and use taxes.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. (a) (1) The gross proceeds from the retail
sale of fish or other seafood which is in its original or
unmanufactured state by a producer are exempt from the state
sales and use tax as provided for in Section 40-23-2 and
40-23-61, Code of Alabama 1975.
(2) For the purposes of this section, "producer" shall
mean a licensed commercial fisherman or an owner of a
commercially licensed vessel that is also licensed pursuant to
Section 9-12-125, Code of Alabama 1975 to sell seafood to the
public.
(b) Any county or municipality may exempt the gross
proceeds from the retail sale of fish or seafood which is in
its original or unmanufactured state by a producer from county
or municipal sales and use taxes in accordance with Section
40-23-4.01, Code of Alabama 1975.
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HB3 Engrossed
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40-23-4.01, Code of Alabama 1975.
Section 2. This act shall become effective on September
1, 2026.
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HB3 Engrossed
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1, 2026.
House of Representatives
Read for the first time and referred
to the House of Representatives
committee on Ways and Means
Education
................13-Jan-26
Read for the second time and placed
on the calendar:
1 amendment
................21-Jan-26
Read for the third time and passed
as amended
Yeas 103
Nays 0
Abstains 1
................22-Jan-26
John Treadwell
Clerk
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