AP News

Tax break for small businesses clears Ala. leg


MONTGOMERY, Ala. (AP) — The Alabama Legislature has voted to give small businesses a tax break.

The Senate voted 23-2 Thursday to change the way sales tax payments are made. The bill, which was a priority for the Republican leadership, cleared the House 96-2 in January and now goes to the governor.

Current law requires estimated advance sales tax payments from any business whose sales tax collections over the previous year averaged at least $1,000 per month. The legislation raises that to $2,500. That frees about 4,000 businesses from paying ahead of time and allows them to pay based on actual collections for the previous month.

The shift will mean a one-time $4.5 million loss in sales tax collections. But there will be no long-term change as payments resume normally after the one-month shift.


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