HB155 Summary

• Amends Section 40-12-222 of the Alabama Code to clarify tax sourcing rules for privilege and license taxes on leasing and rental of tangible personal property.

• Establishes different tax determination rules based on property type: for most property, taxes are based on delivery location or lessor's rental location; for registered automotive vehicles, initial nonrecurring fees are taxed where the dealer initiates the lease, while all subsequent payments are taxed based on the lessee's garage address as provided to the county licensing official.

• Allows lessors to pass tax amounts to lessees by adding taxes to the leasing price, with passed-on amounts included in gross proceeds subject to tax owed by the lessor, except for automotive vehicles leased to government entities unless the flat amount collected includes both tax and leasing fee.

• Declares the act as clarification of existing law and applies retroactively to all open tax years and periods for which assessments could be entered, with no new assessments or refunds permitted for periods prior to the effective date.

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