§40-23-2.1. Only one municipal or county sales, etc., tax collected on same sale; payment to improper locality.

(a) If a sales tax, gross receipts tax in the nature of a sales tax, as defined in Section 40-2A-3(8), use tax, or rental tax levied by or on behalf of an Alabama municipality is paid under a requirement of law, the property which is the subject of such tax, when imported for use, storage, or consumption into another Alabama municipality, is not subject to the sales tax, use tax, or rental tax regardless of rate, which is required by the second municipality under any municipal ordinance or any act of the Legislature. The collecting agency shall require such proof of payment of tax to another municipality as is deemed necessary and proper.

(b) If a sales tax, gross receipts tax in the nature of a sales tax, use tax, or rental tax levied by or on behalf of an Alabama county is paid under a requirement of law, the property which is the subject of such tax, when imported for use, storage, or consumption into another Alabama county, is not subject to the sales, use, or rental tax, regardless of rate, which is required by the second county under any county ordinance, resolution, or any act of the Legislature. The collecting agency shall require such proof of payment of the tax to another Alabama county as is deemed necessary and proper.

(c) This section applies to all municipalities in Alabama levying or administering a sales tax, gross receipts tax in the nature of a sales tax, use tax, or rental tax and all counties in Alabama levying or administering a sales tax, gross receipts tax in the nature of a sales tax, use tax, or rental tax. It is the intent of this section that only one municipal sales, use, rental, or gross receipts tax in the nature of a sales tax, and only one county sales, use, rental, or gross receipts tax in the nature of a sales tax be collected or paid on the same sale or rental transaction. To that end, if a sales tax, gross receipts tax in the nature of a sales tax, use tax, or rental tax owed to one municipality or county, hereinafter referred to as the "proper locality," is erroneously paid to a different municipality or county in good faith, based on a reasonable interpretation of the enabling ordinance, resolution, or act levying or authorizing the tax, but not under a requirement of law, the municipality or county receiving the erroneous payment shall refund the overpaid tax, without interest, to the taxpayer within 60 days of the taxpayer's compliance with the applicable refund procedures. In order to avoid the accrual of interest and any otherwise applicable penalties on the tax due the proper locality, the taxpayer making the erroneous payment must comply with the applicable refund procedures within 60 days of receiving notice from a county, municipality, or its agent of the erroneous payment. If the taxpayer complies with the refund procedure in a timely manner, the proper locality shall not assess or attempt to assess the tax, or any related interest or otherwise applicable penalty thereon, and no interest or penalty thereon shall accrue, until the date of receipt of the overpayment by the taxpayer or the taxpayer's agent. However, the taxpayer's failure to comply with the refund procedures within the requisite 60-day period shall cause interest and any applicable penalties to accrue on the tax to which the proper locality is entitled from the sixty-first day and until such time as the tax is paid. The taxpayer shall remit the disputed tax to the proper localities within 15 days after receipt. Provided, that if the applicable rate of sales tax or gross receipts tax in the nature of a sales tax imposed by the municipality or county receiving an erroneous payment of the sales or gross receipts tax exceeds the rate of sales or gross receipts tax imposed by the proper locality under a requirement of law, the municipality or county that erroneously received the tax shall not be obligated to refund the difference unless the taxpayer properly files the applicable petition for refund.

(Acts 1987, No. 87-579, p. 926, §§1-3; Act 98-192, p. 310, §9.)