MONTGOMERY, Sept. 4, 2015— By and large, it’s been the burden of Alabama
taxpayers to figure out how much tax they owe on internet purchases from
sellers that don’t have a presence in the state and don’t charge tax. A
voluntary program for such sellers being launched by the Alabama Department of
Revenue could make the use tax obligation much simpler for everyone involved.
Effective
Oct. 1, the “Simplified Seller Use Tax Remittance Act” allows eligible sellers
to participate in the ADOR program to collect and report a flat 8 percent
seller use tax on all sales made into Alabama. As an incentive for sellers to
change their processes and volunteer for the program, the law allows
participating sellers to deduct and keep 2 percent of the use tax properly
collected, provided the collected tax is remitted to ADOR on time.
There
are many other benefits of this new method. Sellers can file one simple return
that reflects one flat tax rate no matter where in Alabama products are
delivered. Both the seller and the purchaser are relieved from any additional
state and local sales or use taxes. Purchasers from whom the tax has been
collected may apply for a refund or take a credit on their consumer’s use tax
return if the 8 percent collected by the eligible seller exceeds the
purchaser’s combined state and local tax rate imposed in their local
jurisdiction. The local portion of the simplified sellers use tax will be
distributed to cities and counties of Alabama based on population.
An
eligible seller is one that sells tangible personal property or a service into
the state of Alabama from an inventory or location outside the state but does
not have a physical presence in the state, and who is not otherwise required by
Sections 41-4-116 or 40-23-190, Code of Alabama 1975, to collect tax on sales
made into the state. Examples of a physical presence include a store location
or inventory, or employees who are permanent or transient in the state.
In
order to participate in the program, retailers must apply and be accepted into
the program established by this act. Those sellers who have been approved to
participate will collect, report, and remit the simplified sellers use tax for
as long as they remain in the program. The simplified sellers use tax is
required to be electronically reported and paid by the 20th day of
each month for the preceding month’s tax collected.
If you have questions regarding this program, you may
view the act in its entirety on the department’s website at http://revenue.alabama.gov/salestax/pdf/Act_2015-448.pdf or contact the Sales and Use Tax Division at
334-242-1490 or our toll-free number 1-866-576-6531. Sellers can find the
application to participate in the program at http://revenue.alabama.gov/salestax/pdf/SSUT-Application_(9-15).pdf.
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Media contact for more information:
ADOR Communications/Publications
Section
Frank.miles@revenue.alabama.gov
Carolyn.blackstock@revenue.alabama.gov
Amanda.collier@revenue.alabama.gov
Telephone: 334-242-1390; FAX:
334-242-0550
Website address: http://revenue.alabama.gov