As of Jan. 1, Transactions Follow New Local Nexus Rule
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www.alabamaretail.org Volume 13, number 4 As of Jan. 1, transactions follow new local nexus rule — At the 32nd Annual Retail Day, Alabama A new regulation regarding local nexus Retail and UAB honored 13 outstanding that parallels the state nexus rule applies Alabama retail busi - nesses with operations in 72 Alabama to transactions in Alabama starting in 2014. cities and 31 states as Retailers of the Year or as Centennial Retailers. Under the new rule, a seller using its own delivery trucks and its own employees is responsible for collecting and remitting the — The Alabama applicable local tax. Legislature returns Jan. 14 with some If the seller uses a common carrier or the U.S. mail to new faces and some perform a delivery, provided the seller has “no vacancies. Alabama Retail will be there advancing its other contact” with the destination locality, Legislative Agenda. the seller does not have an obligation to — Alabama Retail calls collect and remit the local sales and use tax. on Congress to rectify The corresponding use tax may be owed the online sales tax by the purchaser/consumer. loophole before another continued on Page 10 holiday shopping season rolls around. Expect 2 percent Subcommittee focuses — Alabama’s severe growth in holiday sales on retail products for weather sales tax holiday returns Holiday spending should business license reform in February. Start A joint legislative subcommittee gearing up now. near $9 billion in Alabama. The Alabama Retail Association expects tasked with reforming Alabama’s cumbersome and confusing state — Eight years 2013 taxed holiday sales to reach $8.9 billion, in, Alabama’s back- at least 2 percent higher than the $8.7 billion and county business licensing to-school sales tax spent during November and December system has narrowed the scope of any holiday continues of 2012. If that prediction proves true, initial legislation to creating a single to produce results. Alabamians should spend almost $175 million business license for retail products and Sales tax collections grew almost more this holiday season than in 2012 repealing obsolete business licenses. The 3 percent in August even though on taxed purchases. committee is expected to draft legislation books, school supplies, computers and for possible introduction at the start clothes were tax free for three days Nationally, holiday sales are of the Alabama Legislature’s 2014 during the month. expected to increase 3.5 percent to $602.1 billion. Last regular session in January. See year, holiday spending AlabamaRetail’sLegislative in Alabama declined a AgendaonPages8and9 . half percent compared Currently, the state of to Holiday 2011. Alabama issues 136 dif- Learn more about ferent kinds of business untaxed purchases licenses. Some are based on Page 2. more on Page 10 VOLUME 13, NUMBER 4 FOURTH QUARTER PUBLISHER: RICK BROWN EDITOR: NANCY KING DENNIS labama’s hometown, Main Street, Amom-and-pop, small retailers have one wish this holiday season: That the 201 2-2013 OFFICERS U.S. Congress closes the online sales tax CHAIRMAN: loophole. DIANNE WAMMACK Cameras Brookwood, Vestavia Hills Your Alabama Retail Association predicts VICE CHAIRMAN : Alabamians will make $8.9 billion in taxed GEORGE WILDER purchases in November and December The Locker Room, Montgomery and Auburn (SeePage1 ). PRESIDENT: RICK BROWN Consumers in our state probably will spend Montgomery as much as another $712 million this holiday VICE PRESIDENT: season with out-of-state, online-only retailers ALISON WINGATE who don’t collect sales taxes, based on 2012 Montgomery research done by professors at the University TREASURER: BOB AKERS of Alabama at Birmingham’s Collat School Davis Direct, Montgomery of Business. SECRETARY: That means hundreds of millions of VIRGIE TODD dollars will be spent by our citizens that Montgomery will not benefit the state of Alabama nor $6.8 billion in additional GDP and 21,732 IMMEDIATE PAST CHAIRMAN: new jobs. The 2012 study by Robert JIMMY RAY SMITH its retailers. It is past time for Congress Jimmy Smith Jewelers, Decatur to address e-fairness and end the online Robicheaux, Ph.D., chair of the Depart - sales tax loophole before another holiday ment of Marketing, Industrial Distribution shopping period rolls around. and Economics in the Collat School of Progress has been made this year toward Business at UAB and an Alabama Retail 2012-2013 OFFICERS that goal. In May, the U.S. Senate, includ - Association board member, said Alabama CHAIRMAN : ing Alabama’s senators Richard Shelby loses $2 billion in taxable sales to out-of- KEN HUBBARD and Jeff Sessions, approved the Market - state online retailers each year, resulting in Western Supermarkets, Birmingham place Fairness Act, which would level the the loss of as many as 4,000 jobs annually. TRUSTEES: DARRELL BOURNE playing field in regard to sales tax collec - Alabama needs Congress to pass the Mar - Ragland Brothers Retail Cos., Inc., Huntsville tion for most retailers. In September, the ketplace Fairness Act as soon as possible CAREY ROME House Judiciary Committee, including a to give states the ability to collect these Cypress Resources, Birmingham subcommittee led by Alabama’s 6th taxes online. JIMMY RAY SMITH District Congressman Spencer Bachus, Alabama Retail members have been on Jimmy Smith Jewelers, Decatur released its principles for remote sales tax the forefront of this debate for years and BUD SKINNER have communicated their support for e- Jubilee Seafood, Montgomery collection. Now, Congress needs to take fairness at every step in the process. Once CRAIG VINSON JR. swift action by drafting legislation based Granville Interiors LLC, Montgomery on these principles and passing the bill in again, please contact your congressional PHILLIP WEAVER the U.S. House of Representatives. representative and tell him or her that Buffalo Phi l’s, Tuscaloosa President Ronald Reagan's economist your holiday wish is that Congress levels FUND ADMINISTRATOR: FUND MANAGER: Art Laffer released a report earlier this the playing field in regard to sales tax RICK BROWN MARK YOUNG collection. Montgomery Montgomery year that said the potential economic ALABAMA RETAIL QUARTERLY is the official publication of the growth in Alabama by 2022 if the Market - Alabama Retail Association, 7265 Halcyon Summit Drive, Mont - Rick Brown: rbrown@ alabamar etail .org gomery, Alabama 36117-3502. Telephone (334) 263-5757; FAX place Fairness Act passes would be (334) 262-3991. ALABAMA RETAIL QUARTERLY is published four times a year. Views and conclusions expressed in articles herein are those of the authors, not necessarily those of the editors or officers of the Alabama Retail Association. Opinions expressed in this magazine New look for logos and website do not necessarily reflect the policies of the Alabama Retail Asso - ciation. Alabama Retail Association has spiffed up its brand over the past few months. You Advertising: Inquiries should be directed to the Alabama Retail As - may have noticed a new look for the logos for both the association and Alabama Retail sociation. Rates will be furnished on request. The Alabama Retail Association reserves the right to omit any advertising or Comp, which we will continue to phase in as we use up printed materials with the editorial copy deemed to be unsuitable for publication. Publication herein does not necessarily imply endorsement of any product or former logos. Now, we have a new website to match the updated look of our logos. service offered. Check it out at alabamaretail .org and tell us what you think. We did it all so you can Postmaster: Send address changes to ALABAMA RETAIL QUAR - TERLY , P.O. Box 240669, Montgomery, Alabama 36124-0669. better Benefit from the Value of your membership. Alabama Retail Quarterly - FOURTH EDITION 2013 2 Localities have until Jan. 21 to join severe weather sales tax holiday For more information, go to: alabamaretail .org/alabamasalestaxholidays/ labama’s third severe weather customers or post them throughout your February 2 sales tax holiday runs from store to help your customers understand 1-23 A12:01a.m.Friday,Feb.21 , what is and isn’t sales tax free. N until midnight,Sunday,Feb.23 . During the February holiday weekend, O SALE S TAX! During that time, Alabama will waive shoppers don’t pay the state's four TH sales taxes on certain items needed to percent sales or use tax on purchases REE DAYS prepare for severe weather emergencies. of qualifying items: common disaster ONLY In mid-November, the Alabama Retail supplies that cost less than $60 that Pay NO S a ales Tax o wide vari n: ety of eme rgency sup Association mailed documents to help every home and business needs to pre - x batte plies, ries; flash including: it lights; tarp ems for pr s; plywoo otecting w d and othe its members prepare for this potentially pare for an emergency; and generators and cool indows in r ers; ice pa storms; ic and cks; first e chests carbon dio aid kits; a x p xide detec nd fire, sm ortab tors ( oke revenue-boosting event, including: costing $1,000 or less. Alabama retailers le generat $60 or less ors and co per item) rds ($1,00 O 0 or less) ☛ apostertohelppromotethe must participate in the state's sales tax FFER GOO D ONL Y IN A This LABA informatio MA three-dayholiday . Even businesses that holidays and cannot charge any waived b n provided y THIS STO RE and th do not sell the tax-free items can benefit. sales taxes on the items that are legally e www. For more alabamaret informati Stimulating sales and boosting the tax-exempt during the tax holiday. ail.org/alab on, go to amasalesta xholidays/ statewide economy is what sales tax Local governments can exempt their holiday weekends are all about. Place sales taxes as well, making the savings Retailers worked this poster in the front of your store or even greater and more enticing for the hard for passage of Alabama’s sales near the items that qualify for the tax consumer.