UPDATE: The City of Mobile has just announced it is joining a lawsuit against the Alabama Department of Revenue (ADOR) over the contentious handling of the Simplified Sellers Use Tax (SSUT). This urgent legal action aims to address the inequities in an 8 percent tax on online sales that has been in place since 2015.
The SSUT has faced scrutiny for disproportionately affecting rural Alabamians while depriving cities like Mobile of vital tax dollars. Currently, the state collects this flat rate regardless of where the purchase is made, leading to a staggering loss of $34 million annually for Mobile. Mayor Spiro Cheriogotis emphasized that local tax revenue should be reinvested in the community to support essential services like public safety and infrastructure.
“Cities like Mobile cannot maintain the services citizens expect if local dollars are continually redistributed across the state,” warned Mayor Cheriogotis. The lawsuit, originally filed by the City of Tuscaloosa, challenges ADOR’s allowance of large online retailers to opt into SSUT, bypassing local and state tax obligations.
The ramifications of this lawsuit extend beyond Mobile. The current structure of SSUT risks exacerbating financial pressures on municipalities across Alabama. The city’s leaders have made it clear that they will continue to push for a solution that protects local tax dollars while ensuring fair treatment for all Alabama communities, regardless of size.
Despite joining this critical legal battle, Mayor Cheriogotis remains hopeful for collaboration with state legislators. “Whether you live in a small town or a major city, every Alabama community deserves to be treated fairly,” he stated, reinforcing the need for systemic change to the SSUT.
Residents are encouraged to stay informed as this lawsuit unfolds, as its outcome could significantly impact local economies and the quality of services provided to citizens throughout Alabama. As online sales continue to surge, the stakes for local governments have never been higher. This developing story will be closely monitored for further updates.
