Overview of the Sales Tax Adjustment
As of January 17, 2019, Florence, Alabama, increased its sales tax to 9.5%, of which 3.5% goes directly to the city.
The purpose of the state and local tax increase is directly related to the interest of increasing wages for servicemen such as police and firefighters. Local officials stated that Florence’s servicemen are underpaid compared to surrounding localities.
Impact on Retailers
If you are a retailer of tangible items that do not meet any sales tax exemptions, you should ensure the following:
- Adjust your point-of-sale terminals to reflect the new sales tax rate.
- Understand that Alabama sales tax audits are not retroactive; however, moving forward, you are required to apply the updated sales tax when charging your customers.
Complexity of Alabama Sales Tax Laws
It is important to note that Alabama has one of the most complex sales tax laws in the nation. This only adds to the confusion for both businesses and consumers.
Frequently Asked Questions
Why did Florence, Alabama, increase its sales tax?
The sales tax was increased to provide higher wages for local servicemen, such as police officers and firefighters, who were earning less compared to similar roles in surrounding areas.
When did the new sales tax rate go into effect?
The updated sales tax rate of 9.5% took effect on January 17, 2019.
How much of the sales tax goes to the city of Florence?
Out of the total 9.5% sales tax, 3.5% is allocated directly to the city of Florence.
What should retailers do to comply with the new sales tax rate?
Retailers should update their point-of-sale systems to reflect the new rate and ensure they apply it to all non-exempt tangible goods moving forward.
Is Alabama known for having complicated sales tax laws?
Yes, Alabama is considered to have one of the most complex sales tax systems in the United States, which can cause confusion for both consumers and businesses.