MONTGOMERY, Ala. – The Alabama State Senate today voted in favor of SB290, sponsored by Senator Tom Butler (R-Madison), to eliminate Alabama’s minimum business privilege tax levied on certain corporations, business trusts, limited liability entities, and disregarded entities.

“Small businesses are the backbone of Alabama’s economy and pillars in our communities, and the last two years have been the most difficult in decades for these entities. While our state budgets are robust, there is a real opportunity to provide substantial support by eliminating the business privilege tax, which will result in an annual $23 million tax cut for our small businesses,” said Butler. “I am pleased that my colleagues in the Senate recognized the need to move this important piece of legislation forward, and I am eager to see this bill on Governor Kay Ivey’s desk so that we can provide relief for Alabama taxpayers and small businesses.”

Under current law, the rate is determined by the taxpayer’s taxable income apportioned and allocated to Alabama. The bill reduces the minimum business privilege tax due for tax year 2023 from $100 to $50 and provides a full exemption from the minimum business privilege tax due for taxable years beginning with tax year 2024 and thereafter.

President Pro Tem Greg Reed (R-Jasper) said that the fiscal health of the state’s budgets presented the legislature with an opportunity to provide this relief.

“Alabama’s economy is strong, and our receipts have increased in both the General Fund and Education budgets, presenting an opportunity to provide a tax break for taxpayers and small businesses,” Reed said. “This bill has a pretty good price tag to it as far as loss of revenue to the state’s budgets, so we have worked closely with the budget chairmen to develop this policy and consider ways to fill the gap. The Senate has prioritized support for Alabama’s businesses, specifically small businesses, and I am proud of the effort that occurred within this legislative body to deliver much-needed relief for Alabamians.”

Senate Majority Leader Clay Scofield, a co-sponsor of the bill, commended Senator Butler for his work.

“I appreciate Senator Butler’s willingness to spearhead this critical relief for Alabamians. The Senate Republican Caucus strives to make Alabama a better place to live, work, and retire, and this meaningful legislation will certainly help us to accomplish that goal,” said Scofield. “I am proud to be a co-sponsor of the bill, and I am pleased with the Caucus’ overall strong appetite on this important endeavor.”

Upon passage in the Senate, this bill now moves to the House of Representatives for consideration.

Co-sponsors of SB290 include Senators Greg Albritton (R-Atmore), Gerald Allen (R-Tuscaloosa), Will Barfoot (R-Pike Road), Donnie Chesteen (R-Geneva), Andrew Jones (R-Centre), Steve Livingston (R-Scottsboro), Tim Melson (R-Florence), Arthur Orr (R-Decatur), Randy Price (R-Opelika), Greg Reed (R-Jasper), Dan Roberts (R-Mountain Brook), Clay Scofield (R-Guntersville), Shay Shelnutt (R-Trussville), Jabo Waggoner (R-Vestavia Hills), April Weaver (R-Brierfield), and Tom Whatley (R-Auburn).

Related Posts