Alabama Cities Sue Over Online Sales Tax Distribution
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MOBILE, Ala. Several Alabama cities have joined a legal challenge this week seeking to change the state's distribution of the Simplified Sellers Use Tax (SSUT), arguing online sales revenue is not allocated equitably. Counties and Association of County Commissions of Alabama intervened to defend existing system. Municipal councils from Madison, Prichard and Mobile voted to join the suit, while all 67 counties and hundreds of municipalities have filed briefs supporting current allocations. Plaintiffs filed the case in Montgomery Circuit Court in August; courts will now consider competing statutory and constitutional claims. Based on 6 articles reviewed and supporting research.
Prepared by Lauren Mitchell and reviewed by editorial team.
Timeline of Events
- 2015: Alabama establishes SSUT to tax online sales for participating retailers.
- August 2025: Tuscaloosa, Mountain Brook and Tuscaloosa city schools file suit in Montgomery Circuit Court.
- Late 2025: Counties and ACCA mobilize to defend the current SSUT allocation system.
- Early December 2025: Multiple cities (Madison, Prichard, Mobile) vote to join plaintiffs before intervention deadline.
- Deadline passes: All 67 counties and numerous municipalities have filed to defend or intervene in the case.
- Articles Published:
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- Left Leaning:
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- Neutral:
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- Distribution:
- Left 0%, Center 100%, Right 0%
If plaintiffs prevail, municipalities that joined the lawsuit could receive larger shares of SSUT revenue, increasing funds available for local public safety, infrastructure, and municipal services; counties and entities currently receiving allocations could see reduced distributions.
Counties and county-funded services that currently receive SSUT allocations could face reduced revenue shares if courts order reallocation; businesses may experience changed collection or remittance responsibilities under any altered implementation.
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Alabama Cities Sue Over Online Sales Tax Distribution
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