SB245 By Senator Orr RFD Finance and Taxation General Fund Rd 1 17-MAR-15

SYNOPSIS: Currently, entities which are exempt from the payment of the state of Alabama sales tax receive exemption from the state of Alabama sales tax at purchase. Also, entities that are exempt from the payment of the state of Alabama sales tax are not required to submit an annual return with the Department of Revenue providing information regarding exempt purchases.

This bill would require entities that are exempt from the payment of the state of Alabama sales tax to pay the state of Alabama sales tax at time of purchase and allow such entities to file an annual return with the Department of Revenue to receive a refund of only the state of Alabama sales tax eligible for exemption.

A BILL TO BE ENTITLED AN ACT

To require all entities exempt from payment of the state of Alabama sales tax to pay the state of Alabama sales tax at time of purchase; to allow all entities exempt from payment of the state of Alabama sales tax to file an annual return to the Department of Revenue; to require the Department of Revenue to promulgate rules; and to provide an effective date.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:

Section 1. (a) All entities, including but not limited to those listed in Title 40, Chapter 23 of the Code of Alabama 1975, exempt from payment of the state of Alabama sales tax shall be required to pay the state of Alabama sales tax at time of purchase.

(b) All entities, including but not limited to those listed in Title 40, Chapter 23 of the Code of Alabama 1975, exempt from the payment of the state of Alabama sales tax may electronically file a return annually with the Department of Revenue by January 20 of each year. The Return shall provide the amount of gross sales that are deemed exempt from the state of Alabama sales tax, with documentation deemed appropriate by the Department of Revenue, for the most recently completed calendar year to receive a refund in the amount of only the state of Alabama sales tax eligible for exemption.

(c) This section shall be operative and the first annual return filed by January 20, 2017 to include the 2016 calendar year.

(d) The Department of Revenue shall adopt rules to implement this section prior to January 1, 2016.