*** Newsflash ***
During the 2015 legislative session, the Alabama Legislature revamped many of the incentives listed below. Policies and regulations are still being drafted. When these are finalized, this page will be updated to reflect the new incentives offered by the State of Alabama. For more information, call MCEDC directly or visit www.MadeInAlabama.com
Alabama is a pro-business state, offering competitive tax incentives to help businesses thrive within the state. Tax abatements and incentives are available to qualifying businesses that are expanding or locating to Alabama. Additional information about Alabama tax rates and incentives can be found at the Alabama Department of Commerce website.
Corporate Income Tax Incentives
Alabama’s corporate income tax rate is 6.5% and is based on a company’s net taxable income in Alabama. In addition to deductions for qualifying pollution control equipment, companies in Alabama can deduct the full amount of federal income taxes apportioned to Alabama.
Other incentives include:
Income Tax Capital Credit
Projects approved by the Alabama Department of Revenue may qualify for Alabama’s income tax capital credit. The annual credit is available every year, for 20 years. Companies can receive a 5% credit for the total capital costs of qualifying projects.
Business Privilege Tax Incentives
The business privilege tax is based upon a company’s ability to pay and determined by the company’s federal tax income in Alabama. Companies who have invested in certain types of pollution control equipment or aircraft equipment may qualify for deductions to their business privilege tax responsibility.
Property Tax Incentives
Property tax incentives include deductions for certain types of pollution control equipment, as well as exemptions for qualifying raw materials and finished goods inventory. Alabama does not levy property taxes on inventory (unless used for lease or rental purposes).
Sales and Use Tax Incentives
Alabama’s sales and use tax statues contain many advantages for businesses, including exemptions for specific organizations and commodities.
Common exemptions include:
Property and Sales Tax Abatements
Abatements for non-educational property and sales and use taxes are available for qualifying companies from Marshall County and individual cities located within the county. For information about local tax abatements, contact the Marshall County Economic Development Council staff at 256-582-5100.