HB541 By Representative Johnson (K) RFD Ways and Means General Fund Rd 1 13-APR-16

SYNOPSIS: This bill defines the term transient as used in Chapter 26 of Title 40 and would clarify that the entity collecting any rental charges shall be responsible for remitting it to the Department.

A BILL TO BE ENTITLED AN ACT

To amend Section 40-26-1, Code of Alabama 1975, relating to transient occupancy tax; to define transient.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Section 40-26-1, Code of Alabama 1975, is amended to read as follows:

§40-26-1.

"(a) There is levied and imposed, in addition to all other taxes of every kind now imposed by law, a privilege or license tax upon every person, firm, or corporation engaging in the business of renting or furnishing any room or rooms, lodging, or accommodations to transients in for any hotel, motel, inn, tourist camp, tourist cabin, or any other place in which rooms, lodgings, or accommodations are regularly furnished to transients for a consideration, in any county which is located in the geographic region comprising the Alabama mountain lakes area, those being Blount, Cherokee, Colbert, Cullman, DeKalb, Etowah, Franklin, Jackson, Lauderdale, Lawrence, Limestone, Madison, Marion, Marshall, Morgan, and Winston, in an amount to be determined by the application of the rate of five percent of the charge for such room, rooms, lodgings, or accommodations, including the charge for use or rental of personal property and services furnished in such room, and the rate of four percent of the charge in every other county. The term transient, as used in this section, shall mean any person as defined in Section 40-23-1, Code of Alabama 1975, to whom one or more rooms, meeting rooms, lodgings, living quarters, or sleeping or housekeeping accommodations, or other accommodations are rented or furnished. There is exempted from the tax levied under this chapter any rentals or services taxed under Division 1 of Article 1 of Chapter 23 of this title. The tax imposed by this section on the total rental amount charged for such accommodations, including any service charges, shall be due from any person, firm, or corporation charging or collecting for such room or rooms, lodgings or other accommodations.

"(b) The tax shall not apply to rooms, lodgings, or accommodations supplied: (i) For a period of 180 continuous days or more in any place; (ii) by camps, conference centers, or similar facilities operated by nonprofit organizations primarily for the benefit of, and in connection with, recreational or educational programs for children, students, or members or guests of other nonprofit organizations during any calendar year; or (iii) by privately operated camps, conference centers, or similar facilities that provide lodging and recreational or educational programs exclusively for the benefit of children, students, or members or guests of nonprofit organizations during any calendar year; (iv) pursuant to a residential real estate agreement that creates a leasehold in real property as covered under Chapter 9A of Title 35; or (v) for accommodations paid for by a corporation for the purposes of hiring, training, or relocating employees, provided the corporation is in compliance with the state, and has been afforded financial incentives by a recognized economic development board to relocate personnel or facilities to this state.

"(c) For purposes of subsection (b): "Children" means individuals under age 21; "student" is defined in accordance with 26 U.S.C. §151(c)(4), as in effect from time to time or by any successor law; "nonprofit organization" is an organization exempt from federal income tax under 26 U.S.C. §501(c)(3), as in effect from time to time or any successor law; and "privately operated" refers to any camp, conference center, or similar facility other than those operated by a nonprofit organization as herein defined.

"(d) For purposes of the exemption provided in subsection (b) to corporations renting accommodations for the purposes of hiring, training, or relocating employees, such corporations must apply to the Department for a certificate of exemption from lodgings tax documenting that it is in compliance with the state and providing evidence that it has been afforded financial incentives by a recognized economic development board to relocate personnel or facilities to this state. Upon receipt of the completed and documented application for a certificate of exemption, the Department will issue the corporation a certificate of exemption from the lodgings tax herein levied. Such certificate must be provided by the corporation to the person renting or furnishing the accommodations as proof of the exemption provided. Such accommodations must be paid for directly by the corporation to the person renting or furnishing the accommodations in order for the exemption to apply. Accommodations paid for by an employee and later reimbursed by the corporation will not meet the requirements of subsection (b).

"(e) Any overpayment of tax, levied under this chapter, erroneously paid directly to the department shall be subject the provisions of Section 40-1-44, Code of Alabama 1975."

Section 2. All laws or parts of laws which conflict with this act are hereby repealed.