News Sales Tax Exemption Bill Passes House

Sales Tax Exemption Bill Passes House

Sales Tax Exemption Bill Passes House
February 23, 2018 |

Legislation clarifying the state sales tax exemption for agricultural products passed the House of Representatives Tuesday during Small Business Day. 

Speaker Mac McCutcheon, R-Capshaw, said designating a legislative day to focus on the needs of small businesses sends a message about the importance of farmers and other entrepreneurs. 

“Mega-projects may get the headlines, but small businesses provide the vast majority of jobs, hope and opportunity across Alabama,” McCutcheon said. “The men and women who operate small businesses risk their savings, their investments and their sweat equity to keep Alabama’s economy healthy and moving forward, and I believe it is time for the House to formally recognize their efforts and sacrifices.”

HB 242 by Rep. David Sessions, R-Grand Bay, was selected for Small Business Day because it ensures all farmers can benefit from Alabama’s existing law. The bill passed 97-0.

Current law exempts taxes on the sale of fruit or agricultural products by a person or corporation that planted, cultivated and harvested the product. HB 242 specifies the exemption would apply when a farmer cultivates and harvests an agricultural product on leased or rented land. It also states gross receipts from the sale of pine straw products by the person who harvested the product would be exempt from state sales tax.

The companion bill, SB 191, is sponsored by Sen. Tom Whatley, R-Auburn. 

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