HB373 Summary

• Amends Alabama Code Sections 40-23-1 and 40-23-60 to clarify that both physical prepaid wireless service cards and non-physical prepaid wireless service (authorization numbers) are subject to sales and use tax.

• Defines "prepaid wireless service" as the right to use mobile telecommunications service paid in advance and sold in predetermined units or dollars that decline with use or expiration of time, which may include non-telecommunications services or digital products.

• Classifies prepaid wireless service evidenced by a physical card as a "prepaid telephone calling card" and prepaid wireless service without a physical card as a "prepaid authorization number," both taxable as tangible personal property.

• Establishes that amendments are intended to clarify existing law rather than make substantive changes, applicable to all open tax periods.

• Provides that prior transactions without a physical card or authorization number issued to the consumer cannot be subject to back tax assessment, except for audits or assessments already underway before the effective date.