Alabama sees surge in sales taxes collected thanks to online businesses

MONTGOMERY, AL (WSFA) - The state of Alabama is seeing a surge in tax collections, but not from a business segment you would expect. Millions of more dollars in taxes have poured in under a program started in 2015 by the Alabama legislature.

"The program started slowly, however, and it really kicked into high gear during the first quarter of calendar '16," said Alabama Department of Revenue Deputy Commissioner Curtis Stewart.

More than 85 retailers with no stores or physical presence in Alabama signed up for what's known as the 'Simplified Use Tax Program'.

"Particularly, Alabama has its extremely complex tax laws, a lot of local taxes, different rates, some things weren't taxable in some localities and some were and on-line sellers always complain that it's too complex to comply in some of those states," Stewart explained.

In other words, businesses outside of Alabama that sell their products in Alabama have so far paid around $15 million in sales taxes. The Alabama legislature passed the bill two years to authorize the program as a way to collect a consumer tax that had by and large gone unpaid.

"I see other sellers signing up," Steward explained. "We're getting interests from every few months from new sellers who've signed up. We've talked with people who aren't aware of the program because they are not Alabama businesses."

Amazon is the latest company to sign up and the list just keeps getting longer.

Here's the breakdown: 50 percent of that amount so far has gone to the General Fund. Of that amount, 75 percent goes to the General Fund and 25 percent to the Education Trust Fund.

Copyright 2017 WSFA 12 News. All rights reserved.