Sales tax plays a crucial role in Alabama’s revenue system, contributing a significant amount to the state’s public sector which includes education, transportation, entertainment, etc. If you own a business in Alabama and want to ensure its seamless operation, it is important to understand how sales tax in Alabama works. At Tax 365, we keep you updated on the latest sales tax in Alabama to avoid penalties. A sales tax is basically, a consumption tax that is imposed on the sale of goods and services. In Alabama, sales tax is imposed on both state and local levels which means the total tax varies depending on where the business transaction takes place. 

The statewide base sales tax rate in Alabama is 4% and it applies to the sale of goods and services.  This tax is applicable to tangible goods and services. The statewide Alabama sales tax rate is 4%. Along with this, the local taxes are added which varies from place to place. At TAX 365, we can help you calculate your tax seamlessly. All you have to do is to enter your PIN code in Alabama’s online tax calculator and it will provide you with the accurate sales tax rate that you need to collect and remit it to the government. Moreover, we will keep you updated on the latest Alabama sales and use tax. Certain goods and services are taxable in Alabama including retail goods, prepared food and beverages, and lodging. On the other hand, certain things that are exempted from sales tax in Alabama are prescription drugs, certain types of medical supplies, and groceries.