License Taxes.

Ala. Code tit. 40, ch. 21, art. 2

in effect

Ala. Code § 40-21-50 Levied Generally.

40-21-50. Levied Generally. For each person operating a public utility, such as a street railroad or interurban railroad operated by electricity or other motive power, waterworks, gas company, pipeline company for transporting or carrying gas, oil, gasoline, water or other commodities, gas distributing companies, whether by means of pipeline or by tanks, drums, tubes, cylinders or otherwise, heating companies or other public utility, except electric, hydroelectric, telephone or telegraph companies, railroad or sleeping car companies and express companies which are otherwise licensed, shall pay to the state a license tax equal to two and two-tenths percent on each $1 of gross receipts of such public utility in this state for the preceding year. For the first year’s business, where an existing public utility is taken over, such license tax payable to the state shall be equal to two and two-tenths percent on each $1 of the gross receipts for the preceding year of the public utility taken over, less whatever sum the prior operators have paid as such license tax on the gross receipts for that year. Where no existing public utility is taken over, such license tax for the first year, as well as for the second year, shall be based on the first year’s business, but shall in no event be less than $100 for the first year’s business; provided, that where business is started after April 1 the payment shall be not less than $50. Any person establishing a new public utility shall pay to the state the sum of $100 where operation is begun between October 1 and April 1 and $50 when operation is begun after April 1 and shall also at the same time execute a bond, payable to the State of Alabama, to insure payment of whatever sum, in addition to the $100 or $50, which may be due when, at the end of the first year or if operation began after April 1, the amount of the gross receipts is ascertainable. Such license tax shall be paid to the Department of Revenue by check made payable to the treasurer and shall be paid quarterly, one fourth on October 1, one fourth on January 1, one fourth on April 1 and one fourth on July 1 and shall become delinquent on the fifteenth day of each said month, based upon gross receipts for the preceding year, or half year if operations began after April 1. The payment of such license shall be accompanied by a sworn statement made on forms furnished by the Department of Revenue by the president, manager or operating officer of the public utility, or by the owner, receiver, or trustee thereof, giving the name of the person, firm, or corporation owning and operating said public utility and the principal place of business thereof, showing the gross receipts of such public utility for the preceding year. The books of every person operating a public utility shall be at all times open to the inspection of the Department of Revenue. Any person failing to make such sworn statement or willfully making a false statement of the gross receipts of such public utility shall be guilty of a misdemeanor and upon conviction shall be fined not exceeding $500 and shall also forfeit to the state three times the amount of the license on said utility, but no license under this schedule shall be paid to the county or counties. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §177; Acts 1971, No. 1417, p. 2420, §1.)

Ala. Code § 40-21-51 Distribution of Revenues Generally.

40-21-51. Distribution of Revenues Generally. All revenues collected under the provisions of Section 40-21-50 shall, after deduction of the cost of collection, be distributed in the following manner: (1) Eighty-five percent of the balance remaining after deduction of the cost of collection shall be deposited in the Special Mental Health Fund to be used for mental health purposes; and (2) Fifteen percent of the balance remaining after deduction of the cost of collection shall be deposited in the State General Fund. (Acts 1971, No. 1417, p. 2420, §2.)

Ala. Code § 40-21-52 Freight Lines and Equipment Companies.

40-21-52. Freight Lines and Equipment Companies. Any person, firm, joint-stock association, or corporation, wherever organized or incorporated, engaged in the business of operating, renting, leasing, or furnishing cars not otherwise listed for taxation in this state for the transportation of freight, whether such freight is owned by such company or any other person, firm, joint-stock association, or corporation, over any railroad or railway line or lines in whole or in part within this state, such line or lines not being owned, leased, or operated by such person, firm, joint-stock association, or corporation, whether such cars are termed box, flat, coal, ore, tank, stock, gondola, furniture, automobile, refrigerator, or some other name, shall be deemed to be a freight line or equipment company. Each freight line or equipment company doing business, owning, operating, renting, leasing, or furnishing cars which are operated in this state shall, on or before March 1 each year, make and file with the Department of Revenue on a form or forms prescribed by the Department of Revenue a statement under oath by its president, secretary, treasurer, superintendent, manager, receiver, trustee, or owner, showing the number of miles run by all its cars over the line or lines of each separate railroad or railway in this state, naming each separate railroad or railway, and the total number of miles run by all of its cars over all line or lines of all railroads or railways in this state, and the total number of miles run by its cars over line or lines or railroads or railways everywhere outside of this state, such mileage to be shown as made for the 12-month period preceding October 1 of each year. There shall be shown on the statement the principal place of business, together with the street address of each freight line or equipment company, together with the names and addresses of persons to whom correspondence or tax notice should be sent. It shall be the duty of the Department of Revenue to examine the statement of each freight line or equipment company, and the reports of each railroad or railway company over whose lines such freight line or equipment moved, and from such statements and reports to compute the average number of cars within the state of each freight line or equipment company for the 12 months preceding October 1 of each year; for the average number of cars found to be in the state for such 12-month period, the reasonable value of such cars shall be computed, and the sum total value of the average number of cars shall be reduced to 30 percent thereof. There is hereby levied and it shall be the duty of the Department of Revenue to assess a license tax of three and one-half percent of the 30 percent value of the average number of cars within the state for the period of 12 months preceding October 1 of each year. Such tax shall be assessed pursuant to the procedures for assessment of tax as set out in Chapter 2A of this title. The tax shall become due on the date of entry of the preliminary assessment and shall be delinquent 30 days after the due date. The tax shall be paid to the Department of Revenue, by check made payable to the Treasurer, and the license tax so paid shall be placed to the credit of the State General Fund. Each railroad or railway company in this state shall also, annually before March 1 of each year, make and file with the Department of Revenue, under oath of some executive officer of the company and on forms prescribed by the Department of Revenue, a report containing as to all its lines in Alabama all the data required of freight line or equipment companies and any additional information deemed necessary by the Department of Revenue. Any person, firm, corporation, or association operating, renting, leasing, or otherwise furnishing cars as above mentioned, except a regularly organized and operated railroad, is deemed to be a freight line equipment company. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §176; Acts 1971, No. 1413, p. 2408; Acts 1992, No. 92-186, p. 349, §62.)

Ala. Code § 40-21-53 Electric, Hydroelectric, Gas, or Any Other Public Utility - License Tax - Credit on Electric Bills for Certain Persons.

40-21-53. Electric, Hydroelectric, Gas, or Any Other Public Utility - License Tax - Credit on Electric Bills for Certain Persons. (a) Each person, firm, or corporation, including any corporations operating an electric or hydroelectric public utility; or a gas public utility; or any privately owned and operated wastewater system as defined in Section 22-25B-1 which is required by Chapter 25B of Title 22, to be operated and maintained by a wastewater management entity certified by the Public Service Commission; or any other public or municipal utility now paying the two and two-tenths percent shall be subject to the provisions of this section and shall pay to the state a license tax equal to two and two-tenths percent on each $1 of gross receipts of such public utility for the preceding year; except, that gross receipts from the sale of electricity for resale by such electric or hydroelectric public utilities and gross receipts from the sale of electricity to the persons identified in subsection (b) of this section shall be deducted in computing the amount of tax due hereunder. For the first year’s business, where an existing electric public utility is taken over, such license tax payable to the state shall be equal to two and two-tenths percent on each $1 of gross receipts for the preceding year of the electric utility taken over, after deduction of gross receipts derived from sales of electricity for resale and gross receipts from the sale of electricity to the persons identified in subsection (b) of this section and less whatever sum the prior operators shall have paid as such license tax on the gross receipts for that year. Where no existing electric public utility is taken over, the license tax for the first year upon such utility shall be based upon the first year’s business, computed as provided hereinabove, but shall in no event be less than $100 for the first year’s business. Any person, firm, or corporation establishing a new electric public utility shall pay to the state the sum of $100 and shall also at the same time execute a bond payable to the State of Alabama to insure payment of whatever sum in addition to such $100 may be due when, at the end of the first year the amount of gross receipts for the year is ascertainable. Such license tax shall be paid to the Department of Revenue by check made payable to the Treasurer and shall be paid quarterly, one fourth on October 1, one fourth on January 1, one fourth on April 1 and one fourth on July 1 and shall become delinquent on the fifteenth day of each of said months. Payment shall be accompanied by a statement made by the president or other officer of the public utility or by the owner thereof, giving the name of the person, firm, or corporation owning and operating such public utility and the principal place of business thereof, together with a statement under oath of the amount of gross receipts of such public utility for the preceding year. The books of every person, firm, or corporation operating such public utility shall be at all times open to the inspection of the Department of Revenue. Any person failing to make such sworn statement or willfully making a false statement of the gross receipts of such public utility shall be guilty of a misdemeanor and, upon conviction thereof, shall be fined not exceeding $500 and shall also forfeit to the state three times the amount of the license for such public utility, but no license under this schedule shall be paid to the county or counties. (b)(1) On or after October 1, 1981 any person who is 62 years of age or older or totally and permanently disabled and such person is head of a household and does not share his or her residence with more than one other adult person who is less than 62 years of age and who receives electricity at such residence from a utility which is subject to the 2.2 percent license tax levied in subsection (a) of this section shall be entitled to qualify, in accordance with the provisions of subdivision (2) of this subsection, for a credit on his or her monthly electric bill in the amount of the exemption from the 2.2 percent license tax with respect to sales of electricity to such person provided in subsection (a) of this section; provided that the combined gross incomes of all persons who live at the residence of such person 62 years of age or older or such totally and permanently disabled person shall not exceed $12,000 annually. Eligibility for this credit applies only to the extent and amount that it is billed to the customers as a normal requirement under its rates. (2) Any person who seeks to qualify for the credit provided in subdivision (1) of this subsection shall make application to the Department of Human Resources in accordance with the rules promulgated by the Department of Human Resources for the implementation and enforcement of this section. The Department of Human Resources shall periodically notify, in writing, each electric utility in the state which is subject to payment of the 2.2 percent license tax levied in subsection (a) of this section regarding those customers who are entitled to receive the monthly credit. Within 45 days after receipt of notification for such monthly credit the electric utility shall commence providing such credit for gross receipts license tax that otherwise would be billed. (3) Any person who wrongfully qualifies for such exemption by giving false information shall be guilty of a misdemeanor and upon conviction may be fined not to exceed $500. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §178; Acts 1971, No. 1412, p. 2406, §1; Acts 1981, No. 81-867, p. 1659; Act 2009-773, p. 2388, §3.)

Ala. Code § 40-21-54 Electric, Hydroelectric, Gas, or Any Other Public Utility - Not to Constitute Part of Gross Receipts for Purposes of Computation of State, County or Municipal Tax, Etc.

40-21-54. Electric, Hydroelectric, Gas, or Any Other Public Utility - Not to Constitute Part of Gross Receipts for Purposes of Computation of State, County or Municipal Tax, Etc. The provisions of any state, county or municipal ordinance or law to the contrary notwithstanding, the tax levied and collectible pursuant to Section 40-21-53 shall be deductible from and shall not constitute a part of gross receipts for purposes of computing the amount due under any state, county or municipal tax, excise, license, or fee which is based upon or measured by the gross receipts of any person, firm, municipality, or corporation operating an electric or hydroelectric public utility subject to the tax levied by said section. (Acts 1971, No. 1412, p. 2406, §2.)

Ala. Code § 40-21-55 Electric, Hydroelectric, Gas, or Any Other Public Utility - Distribution of Revenues.

40-21-55. Electric, Hydroelectric, Gas, or Any Other Public Utility - Distribution of Revenues. All revenues collected under the provisions of Section 40-21-53 shall, after deduction of the cost of collection, be distributed in the following manner: (1) Eighty-five percent of the balance remaining after deduction of the cost of collection shall be deposited in the Special Mental Health Fund to be used for mental health purposes; and (2) Fifteen percent of the balance remaining after deduction of the cost of collection shall be deposited in the General Fund. (Acts 1971, No. 1412, p. 2406, §3.)

Ala. Code § 40-21-56 Manufacturers and Sellers of Hydroelectric Power.

40-21-56. Manufacturers and Sellers of Hydroelectric Power. In addition to all other taxes of every kind now imposed by law or otherwise imposed by this title, there is hereby levied a license or privilege tax upon each person, firm, corporation, agent or officer engaged in the business of manufacturing and selling hydroelectric power in the State of Alabama for the privilege of engaging in such business; said license or privilege tax shall be due and payable in advance, on or before September 25 of each year, and shall be in sum equal to two fifths of a mill upon each kilowatt hour of hydroelectric power manufactured and sold during the preceding calendar year. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §179; Acts 1957, No. 551, p. 772.)

Ala. Code § 40-21-60 Express Companies - Generally.

40-21-60. Express Companies - Generally. In addition to all other taxes of every kind imposed by this title, there is hereby levied a license or privilege tax upon each person engaged in the business of operating an express company in the State of Alabama for the privilege of engaging in such business; said license or privilege tax shall be due and payable to the Department of Revenue by check made payable to the Treasurer annually in advance, on or before October 1 of each year, and shall be in a sum equal to two and one-half percent of the gross receipts of such express company from all the intrastate business within the State of Alabama during the preceding calendar year. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §184.)

Ala. Code § 40-21-61 Express Companies - Alternative Tax.

40-21-61. Express Companies - Alternative Tax. There shall be levied and collected from every person doing an express business between points wholly within this state and without reference to its interstate business, whether incorporated under the laws of this state or any other state or whether incorporated at all, a license or privilege tax of $4,000, which shall be paid to the Department of Revenue by check made payable to the Treasury by said company on or before the expiration of the fifteenth day of each fiscal year; provided, that any express company which operates on less than 50 miles of railroad, street railway, motor line, or boat line shall pay an annual tax of $250; and provided, that any express company which operated on 50 miles of railroad, street railway, motor line, or boat line, and less than 200 miles of railroad, street railway, motor line or boat line, shall pay an annual license of $500; and provided further, that all express companies that operate on 200 and not over 500 miles shall pay an annual tax of $2,500. It is not intended that the taxpayer under this section and Section 40-21-60 shall pay both the taxes therein mentioned, but that the taxpayer shall pay the larger of the two. The tax levied by this section and Section 40-21-60 shall not apply to bus lines which pay a license and mileage tax under Chapter 19 of this title and which carry express as a regular part of their business of hauling passengers. (Acts 1935, No. 432, p. 910; Code 1940, T. 51, §185.)

Ala. Code § 40-21-62 Report of Gross Receipts by Utility.

40-21-62. Report of Gross Receipts by Utility. In all cases where a public utility is required under this title to pay a privilege or license tax on gross receipts, such public utility shall make report to the Department of Revenue of such gross receipts to which such tax is applicable in a manner and form which will show the correct and true amount of such gross receipts upon which the tax is computed. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §181.)

Ala. Code § 40-21-63 Receipts from Department.

40-21-63. Receipts from Department. The Department of Revenue shall, upon receipt of any amount of money due for tax on gross receipts of any public utility, mail to such utility paying the tax a receipt therefor. Such a receipt shall state specifically the section of this title levying the tax for which such receipt is given. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §187.)

Ala. Code § 40-21-64 Counties Not to Levy Privilege or License Taxes.

40-21-64. Counties Not to Levy Privilege or License Taxes. No county shall levy a privilege or license tax on any business or occupation on which a privilege or license tax is levied by this article or on any telephone or telegraph utility business. (Acts 1935, No. 194, p. 256; Code 1940, T. 51, §188; Acts 1992, No. 92-623, p. 1466, §13.)

Source: Alabama Legislature (alison.legislature.state.al.us)URL: https://alison.legislature.state.al.us/code-of-alabamaFetched: 10/20/2026