Jun 15, 2015
From KPMG TaxWatch
The Alabama “Simplified Seller Use Tax Remittance Act" (Senate Bill 437) recently became law. The Act allows participating sellers to collect, report, and remit an eight percent simplified sellers use tax on sales of tangible personal property delivered to Alabama purchasers. The eight percent use tax covers both state and local taxes. If simplified sellers use tax is collected, the purchaser and the seller are not liable for any additional use taxes on the transaction, regardless of whether the actual combined local and state rate is higher than eight percent.
Participation is elective and interested sellers that currently do not have Alabama nexus must apply to the Department of Revenue for acceptance into the program. The benefits of participating are twofold. First, participating sellers may deduct and retain two percent of the simplified sellers use tax collected. Second, eligible sellers participating in the program will be granted amnesty for any uncollected remote use taxes due on sales made to Alabama purchasers for the twelve-month period before the seller joins the program. The Department will administer the program and is required under the Act to develop an easily-accessible, online system that sellers will use to collect, report, and remit the simplified sellers use tax. Participation in the program will not subject an eligible seller to franchise, income, occupation, or any other type of taxes or licensing requirements imposed by the state of Alabama or any Alabama locality. In the event that a change in federal law—either the enactment of federal legislation or a judicial decision— eliminates the Quill physical presence requirement, the provisions of the Act will apply only to eligible sellers that are participants in the program for at least six months prior to the date of the federal law change. Please contact Marc Grossman at 404- 222-3508 with questions on Alabama Senate Bill 437.
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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.
The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.