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Alabama Code (Last Updated: November 28, 2014) |
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Title40 REVENUE AND TAXATION. |
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Chapter21. PUBLIC UTILITIES. |
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Article4. Utility Service Use Tax. |
§40-21-102. Levy of tax; sourcing of total sales price for telegraph or telephone services.
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(a) There is hereby levied, in addition to all other taxes of every kind now imposed by law, and shall be collected as herein provided, an excise tax on the storage, use, or other consumption of electricity, domestic water, and natural gas in the State of Alabama. The amount of the tax shall be determined by the application of rates against the sales price of such services in the State of Alabama. The tax shall be computed monthly in accordance with the following table:
If the total sales price of the utility services furnished by a utility and stored, used, or otherwise consumed by a person in one month is: The tax with respect to the utility service is: Not over $40,000.00 4% of the sales price Over $40,000.00 but not over $60,000.00 $1,600.00 plus 3% of excess over $40,000.00 Over $60,000.00 $2,200.00 plus 2% of excess over $60,000.00
(b) There is hereby levied an excise tax on the storage, use, or other consumption of telegraph services or telephone services in the State of Alabama. The amount of the tax shall be determined by the application of rates against the sales price of such services in the State of Alabama. The tax shall be applied to interstate telephone service beginning with bills dated on or after February 1, 2002, regardless of when the services being billed were provided. The amount of the tax shall be computed monthly, in accordance with the following table:
If the total sales price of the utility services furnished by a utility and stored, used, or otherwise consumed by a person in one month is: The tax with respect to the utility service is: Not over $60,000.00 6.7% of the sales price Over $60,000.00 $4,020.00 plus 3.7% of excess over $60,000.00
Beginning with bills dated on or after April 1, 2002, the tax shall be computed at the rate of six percent. The utility furnishing such telegraph or telephone services shall be entitled to deduct and retain from the gross amount of tax billed by the utility nine-tenths of one percent of the amount of such tax billed on or after February 1, 2002, in consideration of the costs incurred by the utility in collecting and remitting the tax levied by this subsection; provided, however, that on and following October 1, 2002, the amount deducted and retained by such utility shall be one-fourth of one percent of the gross amount of such tax billed.
(c) Every person storing, using, or otherwise consuming utility services in the State of Alabama shall be liable for the tax imposed herein. Such liability shall not be extinguished until the tax has been paid to the State of Alabama.
(d) If charges for a nontaxable service are aggregated with and not separately stated from charges for telephone or telegraph service that are subject to taxation, then the charges for the nontaxable service are subject to taxation unless the utility can reasonably identify the charges not subject to taxation from its books and records that are kept in the regular course of business.
(e) The provisions of subsection (d) do not create any customer right to require that, for purposes of determining the amount of tax applicable to a transaction, either the utility or the department allocate or attribute the bundled charge to the different portions of the transaction in order to minimize the amount of tax charged to the customer.
(f) The total sales price from the storage, use, or other consumption of telegraph service or telephone service is sourced as follows:
(1) Except for the defined telegraph or telephone services in subdivisions (3) and (4), the storage, use, or consumption of telephone service sold on a call-by-call basis shall be sourced to a. each level of taxing jurisdiction where the call originates and terminates in that jurisdiction or b. each level of taxing jurisdiction where the call either originates or terminates and in which the service address is also located.
(2) Except for the defined telegraph or telephone services in subdivisions (3) and (4), the storage, use, or consumption of telephone service sold on a basis other than a call-by-call basis is sourced to the customer's place of primary use.
(3) The storage, use, or consumption of post-paid calling service is sourced to the origination point of the telecommunications signal as first identified by either a. the seller's telecommunication system, or b. information received by the seller from its service provider, where the system used to transport such signal is not that of the seller.
(4) The storage, use, or consumption of private communication service is sourced as follows:
a. Service for a separate charge related to a customer channel termination point is sourced to each level of jurisdiction in which such customer channel termination point is located.
b. Service where all customer channel termination points are located entirely within one jurisdiction is sourced to the jurisdiction in which the customer channel termination points are located.
c. Service for segments of a channel between two customer channel termination points located in different jurisdictions and which segments of channel are separately charged is sourced 50 percent in each level of jurisdiction in which the customer channel termination points are located.
d. Service for segments of a channel located in more than one jurisdiction or levels of jurisdiction and which segments are not separately billed is sourced in each jurisdiction based on the percentage determined by dividing the number of customer channel termination points in such jurisdiction by the total number of customer channel termination points.