HB514 Summary

• Amends Section 40-23-1 of the Alabama Code to make the dispensing or transferring of ophthalmic materials by licensed ophthalmologists and optometrists subject to state sales tax.

• Currently, ophthalmologists are exempt from sales tax when dispensing ophthalmic materials (lenses, frames, eyeglasses, contact lenses, and therapeutic optic devices) as part of professional services, but this exemption is eliminated.

• Licensed ophthalmologists and optometrists will be considered retailers responsible for collecting sales tax on ophthalmic materials transferred to patients; professional services fees (dispensing and fitting fees) remain exempt from sales tax.

• When ophthalmic materials are purchased through third-party benefit plans such as Medicare, sales tax applies to the amount paid by the consumer at the time of sale.

• The act becomes effective on the first day of the third month following passage and approval by the Governor.