AlabamaAlabama tax definitions use newer industry codes and plan references
The enrolled text uses 2022 industry classifications and the CatALyst economic plan in definitions tied to Alabama tax abatements and incentives, effective June 1, 2026.
What it does
Economic-development tax and incentive definitions refer to 2022 industry classifications and the CatALyst plan, including later amendments or successor plans.
Qualifying projects must invest at least $2 million, mainly carry out an approved activity, and meet job rules before receiving the covered economic-development treatment.
A county or municipality must approve certain tax abatements by resolution before they can take effect for a qualifying tourism attraction.
Argument forUsing current industry codes and the state's current development plan could help agencies and businesses apply the incentive rules more consistently.
Argument againstBusinesses may face uncertainty if agencies, tax officials, and applicants must adjust records and applications to different industry codes and plan references.
More detail
Definitions used in several economic-development tax and incentive laws refer to the 2022 NAICS system and the CatALyst economic development plan. The references apply to industrial or research enterprises, approved activities, qualifying research, and qualifying projects covered by the listed laws. The definitions also recognize similar future industry classification systems developed with federal commerce agencies. References include CatALyst and any amended or successor comprehensive economic development plan, along with certain Department of Commerce rules. The act states that these provisions take effect on June 1, 2026.
The Secretary of Commerce must find that a qualifying project carries out an approved activity and meets the required job standard. A qualifying project must invest at least $2 million, mainly conduct an approved activity, and have no project agreement with the Governor for other incentives. Projects in chemical manufacturing, data centers, renewable energy generation, engineering, design, research, metalworking technology, or toolmaking may employ any number of new employees. Other qualifying projects must employ at least 50 new employees unless the Secretary finds extraordinary circumstances. Excluded main activities include most farming and retail businesses, shopping centers, restaurants, entertainment businesses, gaming facilities, and establishments serving the local community; related activities may be included when they are secondary. The act states that these provisions take effect on June 1, 2026.
A county or municipality's governing body must adopt a resolution before a specified tax abatement for a qualifying tourism attraction takes effect. The condition covers abatements of specified county or municipal property taxes, construction-related taxes, or related payments for a qualifying tourism destination attraction. The attraction must qualify as an enterprise under the covered economic-development definitions. The resolution must approve the abatement or abatements. The abatement takes effect only after the governing body adopts the resolution; the act states that this provision takes effect on June 1, 2026.
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Where it stands
- Introduced
- Passed House
- Passed Senate
- To Governor
- Became Law
Looking ahead
No hearings or votes scheduled.
History
- 2026
- Apr 17EnactedBecame Law
- Apr 8Signature Requested
- Apr 8Delivered to GovernorTo Governor
- Apr 7Third Reading in Second House
- Vote recorded Motion to Read a Third Time and Pass - Adopted Roll Call 1192. Result: pass.Upper
- Vote recorded Third Reading in Second House. Result: pass.Upper
- Apr 7Motion to Read a Third Time and Pass - Adopted Roll Call 1192Passed Senate
- Apr 7Ready to Enroll
- Apr 7Enrolled
- Mar 17Reported Out of Committee Second House
- Mar 17Read for the Second Time and placed on the Calendar (Fiscal Responsibility and Economic Development)Minor
- Feb 26Third Reading in House of Origin
- Vote recorded Third Reading in House of Origin. Result: pass.Lower
- Vote recorded Motion to Adopt - Adopted Roll Call 634. Result: pass.Lower
- Vote recorded Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 635. Result: pass.Lower
- Feb 26Economic Development and Tourism Engrossed Substitute Offered (Economic Development and Tourism)Minor
- Feb 26Motion to Adopt - Adopted Roll Call 634Major
- Feb 26Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 635Passed House
- Feb 26Engrossed
- Feb 26Read for the first time and referred to the Senate Committee on Fiscal Responsibility and Economic DevelopmentMinor
- Feb 26Pending Committee Action in Second House (Fiscal Responsibility and Economic Development)
- Feb 12Read for the Second Time and placed on the Calendar (Economic Development and Tourism)Minor
- Feb 11Reported Out of Committee House of Origin (Economic Development and Tourism)
- Feb 5Read for the first time and referred to the House Committee on Economic Development and TourismMinor
- Feb 5Pending Committee Action in House of Origin (Economic Development and Tourism)Introduced
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