Local sales and use taxes, exemption for nonresident Alabama taxpayers established

Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: Albritton
Last action: 2026-01-13
Official status: Pending Committee Action in House of Origin
Effective date: Not listed

Plain English Breakdown

The official source material does not specify what constitutes acceptable proof of residency.

Exempting Nonresident Alabama Taxpayers from Local Sales and Use Taxes

This bill creates an exemption for nonresidents of a municipality in Alabama to not pay local sales and use taxes when they buy tangible personal property outside their place of residence, provided they can prove residency.

What This Bill Does

Creates an exemption for nonresident Alabama taxpayers from paying municipal sales and use taxes on purchases made outside their home city or town if they provide proof of residency.

Who It Names or Affects

Nonresidents of a municipality in Alabama who buy tangible personal property (like clothing, electronics) outside their home city or town and can prove residency.

Terms To Know

Tangible Personal Property: Physical items that can be touched and owned, such as clothes, furniture, and electronic devices.

Limits and Unknowns

The bill does not specify what proof of residency is acceptable.
It only affects local sales and use taxes, not state-level taxes.

Bill History

2026-01-13 Senate
Pending Committee Action in House of Origin
2026-01-13 Senate
Read for the first time and referred to the Senate Committee on Finance and Taxation General Fund

Official Summary Text

Local sales and use taxes, exemption for nonresident Alabama taxpayers established

Current Bill Text

Read the full stored bill text

SB37 INTRODUCED
Page 0
SB37
NR6F5TJ-1
By Senator Albritton
RFD: Finance and Taxation General Fund
First Read: 13-Jan-26
PFD: 18-Dec-25
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NR6F5TJ-1 12/17/2025 KHF (F)KHF 2025-3720
Page 1
PFD: 18-Dec-25
SYNOPSIS:
Under existing law, sales of tangible personal
property in Alabama are subject to state and local
sales and use taxes.
This bill would exempt sales of tangible
personal property to an Alabama resident who does not
reside within the municipality from municipal sales and
use taxes.
A BILL
TO BE ENTITLED
AN ACT
Relating to sales and use taxes; to exempt sales of
tangible personal property to an Alabama resident who does not
reside within the municipality from municipal sales and use
taxes.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Notwithstanding the provisions of Section
40-23-4.1, Code of Alabama 1975, purchases of tangible
personal property by an Alabama taxpayer in an Alabama
municipality other than his or her place of residence shall be
exempt from the payment of any municipal sales and use taxes
upon proof of residency by the taxpayer.
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SB37 INTRODUCED
Page 2
upon proof of residency by the taxpayer.
Section 2. This act shall become effective on September
1, 2026.
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