It shall be the duty of the Department of Revenue to assess for taxation all property of all railroad companies, street and suburban railroad companies or persons or companies operating railroad or street railroads, or suburban railroads or sleeping cars in this state; all express companies, including railroad companies doing an express business and all telephone and long distance telephone and all telegraph companies, person or persons doing an express, telephone or telegraph business; all persons, firms, or corporations doing a gas business, transporting gas or furnishing gas, natural, manufactured or by-product, in or through pipes or in drums, tubes, cylinders, or by any other method; all water, electric light or power, hydroelectric power companies, steam heat, refrigerated air, dockage or cranage, toll roads, toll ferries, railroad equipment, pipelines for transporting or furnishing natural, manufactured, or by-product gas, water, oil, gasoline, or other commodities of commerce, and the property of all public service or public utility corporations, and all property not required by law to be listed for taxation with the county tax assessor; and the owner, president, general manager, agent, trustee, receiver, or other person or persons having control of the company's affairs in this state shall make returns of all property of said company located in this state to the Department of Revenue.

Between January 1 and March 1 in each year, every company, corporation, association, and individual embraced within the provisions of Section 40-21-1, or coming otherwise within its scope and intent, shall make out and deliver to the Department of Revenue of Alabama a statement containing the information hereinafter prescribed, which statement shall be duly verified by the affidavit of one of the officers of the company, corporation or association or by the individual in whose behalf it is made.

Every person, firm, or corporation whose property is required by this title to be assessed for taxation by the Department of Revenue and not herein otherwise specifically required to make reports to the said department shall, on or before March 1 of each year, make a report of all its property of every nature and character whatsoever and such other and further information upon such forms and in such manner as may be required by the Department of Revenue.

Each such report shall show the following items and particulars as the same stood on the next preceding October 1, together with any other facts or information that may be called for by said Department of Revenue:

(1) The name and principal place of business of the company, corporation, association, or individual in whose behalf the statement is made and the character of the business engaged in;

(2) If a company, association or corporation, the state, or government under the laws of which it was incorporated or authorized to do business, the date of original organization, the date of reorganization, consolidation, or merger and the purpose of its incorporation as expressed in its charter or articles of association;

(3) The place where all books, papers, and accounts are kept, and the names and post-office addresses of the president, secretary, treasurer, superintendent, general manager, general counsel, directors, and all other general officers thereof;

(4) The location of its principal office, the total amount and any kind of business done by it in this state and the total gross receipts derived from its business in this state, including a due proportion of its interstate business, if it has done any business of that character, and its total gross receipts from business done everywhere;

(5) Its total authorized capital stock showing the number of shares of common stock authorized, issued, and outstanding in the hands of the public and in the company's treasury, separate from its preferred stock, and the par or face value of each of such shares;

(6) Its total authorized preferred stock, showing each issue separately and setting out each issue to show the number of shares authorized, issued, and outstanding in the hands of the public and in the company treasury and the rate of interest each issue bears;

(7) The par value and the market or actual value of each issue of common stock and the dividends paid and the par value and market or actual value of each issue separately of preferred stock and interest paid on each issue. If the common or preferred stock is issued without par value, then the number of shares authorized, issued, and outstanding in the hands of the public and in the company treasury must be shown giving the number of shares of each class separately and showing the amount received for the common stock and the market or actual value thereof, and the amount received for each issue of preferred stock and the market or actual value of each such issue and in addition thereto must be shown for each of the issues separately the average market or actual value during the next preceding 12 months. If 25 percent or more of the common stock is held by any one person, firm, or corporation, the number of shares, name, address, relation, and percent of control of the person, firm, or corporation holding such stock must be given. If 25 percent or more of the total number of shares of the several issues of preferred stock is held by one person, firm, or corporation, the number of shares, name, address, and relation of the person, firm, or corporation holding such stock must be given;

(8) A statement of each and every lien, mortgage, and other charge upon the whole or any part of the property of said company, corporation, or association, or individual, and a detailed statement of all series of bonds, debentures, and other securities forming a part of its funded debt, with date of issue, maturity, and rate of interest, together with a statement of the property encumbered or charged thereby, and of the total amount of unpaid debts secured by each mortgage, lien, or charge, and of the interest charged thereon, and to what extent interest has been paid, and the true and fair value of every such debt. A statement of the gross income and earnings for the preceding fiscal year of the person, firm, corporation, or association, including therein all interests on investments and all rents, profits, revenues, and receipts from every source whatsoever, and a statement of the income used for repairs and for betterments and the amount used for extension in this state; the amount of income paid in dividends on common stock and amount paid as interest specifying the amount of interest paid on each issue of preferred stock and upon each issue of bonds, or other forms of indebtedness, the amount set aside for depreciation, for obsolescence, for retirements, and the amount passed to surplus;

(9) A statement of the expense for the preceding fiscal year of the person, firm, corporation, or association, giving in detail the expense or other information of the different units, departments or subdivisions, taxes paid, itemized according to assessments, levies, or charges by the state, its counties, municipal corporations, school districts, or other taxing districts and to other states and to the federal government, on forms furnished by or in the manner required by the department;

(10) If a person, firm, or corporation by this title required to make return to the Department of Revenue keeps its records on a calendar year basis or on a fiscal year basis other than from October 1 to September 30, it may make return of its financial matters required by this title on the basis of the calendar year or on the basis of its fiscal year that ends nearest to October 1, stating in each case the period covered; and

(11) If the person, firm, or corporation does business in other states, then, in addition to the items called for in this chapter with respect to this state, the same items shall also be shown for the business or system as a whole. If any item called for in this section is prorated or allocated to this state, the reason for such proration or allocation and the method so used shall be given.

Whenever any person or association of persons, not being a corporation and having no capital stock, shall engage in this state in any character of business embraced within the provisions of this chapter, the capital and property, or the certificate or other evidence of the rights or interest of the person engaged in such business shall be deemed and treated as the capital stock of such persons or association of persons for the purpose of taxation and for all purposes under this title and shall be estimated and valued, and the intangible property values thereof, when ascertained, shall be apportioned and distributed and assessed and taxed under the provisions hereof in like manner as if such person or association of persons were a corporation, and each such person or association of persons shall annually, within the time and the manner provided in this chapter, make the statements and reports and give the information required by this chapter of the aforesaid corporations, companies and associations and shall be subject to all the penalties and to all the terms and provisions of this chapter.

Insofar as the other evidence and information adduced before said department does not make it appear to said department improper or unjust for it to do so, the said department shall, in fixing the true value of the entire property, tangible and intangible, of any company, corporation, association or individual embraced within the provisions of this title, consider as a factor the average net earnings, averaged over a period of five years, and also take as a basis therefor the aggregate average market value or true value for the preceding year of all its shares of stock and add thereto the average market or true value for the preceding year of its entire indebtedness secured by any mortgage, lien or other charge upon its property and assets, and the sum or sums so produced shall be treated and considered a factor in ascertaining the true value of said entire property, tangible and intangible, for purpose of ad valorem taxation. The department may likewise consider the value of the individual units and items of property and the sum of the values of such units or items.

On or before March 1 of each year, the president, secretary, or auditor of any railroad company whose track or roadbed or any part thereof is in this state or, if such railroad is in the hands of a receiver or trustee, such receiver or trustee shall, under oath, make to the Department of Revenue a return in writing of the total length of such railroad, including the right-of-way, roadbed, side tracks and main tracks in this state, specifying the total length in this state and in each county, city or incorporated town, school district, or other tax district in this state in which a special school tax or other tax is levied; and also of the number of locomotive engines or other units of motive power, and passenger, freight, construction, and other cars of such company for the entire system and the number of each allocated to this state, stating the method used in so allocating, and the location and a description of all other property owned by such company in the State of Alabama, and of the average amount of merchandise and supplies kept or carried on trains for sale or other disposition for profit by such companies to employees or other persons in this state for the year next preceding the return.

The president, secretary, auditor, or managing agent in this state of every telegraph or telephone company, whose line or any part thereof is located within this state, must annually, on or before March 1 of each year, make under oath to the Department of Revenue a return, in such reasonable detail as may be prescribed by such department, on all the property belonging to such company in this state and connected with the business, specifying the several counties in which such property is situated and the items of property situated in each of such counties, towns and school districts.

Every electric power, hydroelectric power, every telegraph, telephone, or long distance telephone company shall include in each return made by it the following particulars:

(1) The number of miles of right-of-way in the state belonging to such company and the number of miles of right-of-way along public roads or on government land or on or along the streets of incorporated cities and towns used by such company, showing the number of miles of each class separately and by what authority such use is granted;

(2) The total length of all transmission lines or telephone or telegraph lines, stated by the number of miles of poles and the number of miles of towers, whether poles are treated or untreated, and description of towers as to size and height, the number of miles of wire, of each material constructed, stated according to the number of miles of each class and size of wire, the number of miles of conduit or of cable, stated according to the number of pairs of wire or other capacity, and the voltage capacity of each electric transmission line shall be stated;

(3) The total length of all lines of said company, whether within or outside of the state; and

(4) The total length of so much of said lines as are within this state and the length of its lines in each of the counties, cities, towns, school districts, or other tax districts of this state into or through which its lines extend, stated according to the number of miles of towers, the number of miles of poles, the number of miles of each class of wire, and the number of miles of each size of conduit or cable. Electric transmission lines shall, in addition to the foregoing state their mileage according to the voltage capacity of each line.

Every water company, gas company and every pipeline company shall show in each statement made by them the following particulars, which are in addition to the foregoing requirements:

(1) The total length of all lines of said company, whether within or outside of the state, the total length of each size pipe and of what material each is constructed;

(2) The total length of so much of each of said lines as are within this state;

(3) The length of each size and kind of lines in each of the counties, cities, towns, school districts, or other tax districts of this state into or through which each size and kind of lines extend, or in which its distribution system, holders, reservoirs, standpipes, drums, tubes, cylinders, meters, services, or other means of storage or distribution are located or used; and

(4) The number of miles of right-of-way in the state belonging to such company and the number of miles of right-of-way along public roads or on government land or on or along the streets of incorporated cities and towns used by such company, showing the number of miles of each class separately and by what authority such use is granted.

Every sleeping car company, parlor or palace car company, dining car company, chair car company, or equipment company operating cars of any kind for carrying passengers or serving meals over any railroad in this state shall also, in addition to the said foregoing requirements, show by each of its statements:

(1) The total mileage traveled by the cars of said company during the next preceding 12 months, whether within this state or beyond its borders, and

(2) The total mileage traveled by such cars within the state during the same period.

All railroad, electric, hydroelectric, telephone and telegraph companies, and all water, gas, street, and interurban railroad companies and all docks, terminals, toll road, toll bridge, and ferry companies and all other public utility companies must make return of each item of real estate describing by metes and bounds and giving number of acres in each tract or by lot and block number, if in incorporated cities or towns, and of the improvements thereon, and all the buildings and structures, stating material of which constructed, and all machinery, fixtures, and appliances, and all other tangible property and assets owned and assessed, or liable to assessment for the same year, within this state, and the location and assessed value thereof, and the county, city, town, or school district, or other tax district wherein the same are assessed for taxation for state, county, municipal, school, or other tax district purposes, or are liable to assessment, and whether or not they are specifically used in business of the company making the return.

Every railroad company shall, in addition to the foregoing requirements, show in each statement made by it the total length of all lines of said company, whether within or outside of this state.

The statement of every public utility shall include a brief description of each tract of land and the improvements thereon, and of the buildings, structures, machinery, fixtures, and appliances and all other tangible property and assets having a fixed situs outside of the state, and the location of each item of such property, the purpose for which it is used, whether or not it is specifically used in the business of the company, corporation or association, or individual in whose behalf the report is made, its true and fair value, the sum of the value at which it is assessed for taxation and the locality in which it is assessed.

Every express company shall also, in addition to the foregoing requirements, show:

(1) Its total gross receipts from all business done under its charter, whether within this state or outside thereof, during the next preceding 12 months;

(2) Its total gross receipts within this state for the same kind of business done during the same period, including a due proportion of receipts from interstate business; and

(3) Its total gross receipts in each county or town in this state for the same kind of business done during the same period.

The Department of Revenue of Alabama shall receive all such statements offered to it under the provisions of this chapter, shall endorse upon each the date upon which it was received and sign the endorsement officially. It shall examine the statements as soon as may be practicable; and, if any of them are found to be insufficient or if said department shall believe other or further information to be necessary, it shall at once demand such additional statements and information as it may think proper.

The department shall proceed forthwith to examine the returns made by all persons, firms, and corporations required by law to make the same and also such information as the department may have obtained in addition thereto, shall determine the valuation of the different items of property required to be returned to it and shall assess such property for taxation at 30 percent of its reasonable value; and, in case no return has been made by or on behalf of such person, firm, or corporation on or before March 1 in each year, the department may add to the assessment which it makes against such person, firm, or corporation a penalty not exceeding 10 percent of the assessment as made therefor. The assessment herein required to be made shall be completed on or before July 1, or as soon thereafter as practicable, and reported to the tax assessor of every county in which any part of said tangible personal property is taxable under the provisions of this title. The report to the tax assessor shall contain a description of all property included in the assessment, the assessed value thereof, and an apportionment of the assessed value of such property to the county, to each municipality, to each special school district, and other districts levying a district tax within said county, with the name and residence or place of business of the owner thereof and all other information necessary to enable the tax assessor to set up such tax assessment upon the assessment books.

The Department of Revenue shall carefully examine and consider said statements and information and shall hear evidence and secure further and additional information as far as may be in its power, whenever it may deem it necessary to do so, to show the true value of properties of such corporations, associations, companies, and individuals and the true value of that portion thereof which is situated within this state and within the respective counties, cities, towns, or other tax districts in this state; and each interested company, corporation, association, or individual may appear before said department and introduce material and relevant testimony before the same touching the true value of said property within this state and the apportionment thereof. From these statements, evidence and information adduced before it, the Department of Revenue shall ascertain, fix, and determine the true value of such property and of the portion thereof which is situated within this state and the respective value of the several portions within the different counties and cities, towns and school districts, or other tax districts having a special assessment in this state, in which such portions are taxable; and for that purpose said department may require and compel by subpoenas to be issued by it any person or persons, or the officers and agents, or any of them, of any company, corporation, or association embraced by the provisions of this title to appear before it with such books, papers, documents, and information as the department may require and to submit themselves to examination by said department, and it shall have all the powers with respect thereto conferred upon it by this title.

If at any time after March 1 of any year the Department of Revenue shall not have in its possession satisfactory data upon which to base an estimate of the value of the property with the assessment of which it is charged or from any other cause it is not able to make or complete any assessment, it shall have power to call upon any officer or agent of any person, firm, or corporation, or upon any receiver or trustee in charge of the property of any person, firm, or corporation for any records, books, or documents of any description pertaining to the business of any such person, firm, or corporation for the answers to any interrogatories which it may deem necessary to an intelligent discharge of its duties; and it shall also have power to require the attendance of any officer of any corporation or any other person where the testimony of such officer or person may to it seem material.

In arriving at the value of such taxable property, whenever used in this chapter or whenever required, the Department of Revenue, the tax assessors, deputy tax assessors, board of equalization, or other assessing authorities and the courts shall be authorized to consider and may consider original costs, reproduction cost new less depreciation, recent sales of contiguous or similar property, the nature of the property, its location, whether in town, city or county, whether it is vacant or occupied, its proximity to local advantages, its use, its fitness for the use to which employed, or its fitness for other uses, the quality of soil, its growth of timber, its mines, minerals, coal beds, oil or gas deposits, the amount and character of improvements thereon, the amount of insurance carried on each item of property, the gross and net income received therefrom during the year or years preceding the date of assessment, the market value of its shares of stock or bonds, or both, if sold in the open market, or if not quoted in the open market, the value thereof, the amount of any bonded indebtedness, loans or mortgages upon it and any and all evidence and information that may be adduced before the assessing authorities or which he or it may procure, shedding light on the value of such property. In assessing any property where such information is obtainable and has or may have any bearing on the values of such property, the tax assessing authorities shall consider the average market or actual value of the stock and bonds of such companies during the preceding year and also shall take into consideration the estimated investment as returned by the duly authorized officer or employee of such company to the Public Service Commission or to the Interstate Commerce Commission, Tennessee Valley Authority, Reconstruction Finance Corporation or Railroad Credit Corporation, or other similar commissions, agencies, or associations of the United States or this state, or value stated in folders, schedules, or prospecti. Any valuation made for rate-making or other purposes of the Public Service Commission of the state, the Interstate Commerce Commission, or other state or governmental bodies shall also be considered.

There shall be subject to taxation in this state the franchises or intangible property and assets of each and every corporation, whether organized under the laws of this state or of any other state or government, and of each and every individual, association, or partnership, or company engaged as a common carrier, wholly or partly in this state, in the business of transporting freight of any description or passengers, or both, over any railroad, including street railroads, or of operating any cars of any kind over any railroads for the transportation of passengers or of property of any kind for others or for the public, including sleeping cars, parlor or palace cars, chair cars, equipment cars of any kind, or engaged in the business of maintaining or operating for gain any telegraph or telephone lines, plant or business, or any plant or business for the production, transportation, piping, distribution, or sale of natural gas, manufacture, distribution, or sale of gas, by or through pipes, drums, tubes, cylinders, or other containers or conveyances, or for manufacture, distribution, or sale of electricity, electric light, electric power, water, steam heat, and refrigerated air, or other similar substance, including the piping of oil or gasoline, by means of wires, pipes, or conduits constructed, operated, or maintained on, over, under, or through any territory or any street, alley, or highway in this state, or in the business of operating for gain any dockage, wharfage, canal, freight, or passenger depots, boats, barges, station, or terminals, toll bridges, and toll ferries, or engaged in any business which may be dependent upon the grant of public powers or privileges, or which may involve the operation of any public utility; and of each and every individual, association, partnership, company, or corporation which has and exercises, under authority granted by charter, statute, or other provision of law, whether of this state or any political subdivision thereof, or of any other state or government, any special or exclusive privilege, franchise, or function which is or may be dependent upon the grant of public power or privilege, or which involves the operation of any public utility.

Where the person, association, company, or corporation operates a water system, express business, electric property, toll bridge, toll ferry, street, or interurban railroad or railroad or car line of any kind, telegraph or telephone line, pipeline, gas line, or gas distributing system of any kind, docks or terminal companies or other public utilities, the lines or properties of which extend beyond the state, there shall also be deducted from the true value of the entire property, tangible and intangible, ascertained as above provided, the market or true value ascertained from the information furnished by said statements, if the value thereof is given in said statements, of all real and personal property of said person, association, company, or corporation not specifically used in its business, and the remainder shall be treated as the true value of all its property, tangible and intangible, actually used in its business. The Department of Revenue shall then ascertain and fix the value of the total property, tangible and intangible, in this state by taking such proportion of the value of the entire property, tangible and intangible, of such persons, association, company, or corporation which is specifically used in its business, ascertained as provided by this chapter, as its total lines or business within this state bear to the total lines or business both inside and outside this state, or as its total receipts from within this state bear to its total receipts from both within and without the state. From the entire value of the property within this state, tangible and intangible, when ascertained as above provided, there shall be deducted the total value of the entire real and personal property of said person, association, company, or corporation in this state, and 30 percent of the residue and remainder of value shall be by the said Department of Revenue fixed and determined as the true value for taxation of the franchise or intangible property of such person, association, company, or corporation so operating said water system, express business, electric property, toll bridge, toll ferry, street or interurban railway, railroad, car line, telegraph line, telephone line, pipeline, gas line, or gas distributing properties, docks or terminal companies, or other public utilities made subject to taxation by the provisions of this title.

After computing the valuation of the tangible and intangible property of a public utility taxpayer, the Department of Revenue shall notify the taxpayer and assess such value in accordance with the procedures set forth in Chapter 2A of this Title 40.

From 30 percent of the value of said entire property, tangible and intangible, thus ascertained, there shall be deducted the assessed value of the entire tangible real and personal property of such persons, association, company, or corporation, and the remainder of the true value shall by said Department of Revenue be fixed and determined as the true value for taxation of the franchise, or intangible properties owned and held by said persons, association, company, or corporation and made subject to taxation by the provisions of this title, where the business and property of such persons, association, company or corporation is within this state.

Every individual, association, partnership, company, and corporation engaged in any business embraced or set out in the preceding sections shall, in addition to the ad valorem taxes on the tangible property which are now imposed upon them by law, annually pay to the state a tax for each year on their franchises or intangible property and assets and shall pay local taxes thereon to each county and municipal corporation, school district and other tax district in which their business is or shall hereafter be carried on. Said tax shall be at the same rate as the tax on tangible property, shall be and become due and delinquent at the same time as the taxes on tangible property, shall be payable and collected in the same manner and shall be assessed and levied in the manner herein provided. The place or places where such local taxes on such property are to be paid and the manner of the apportionment of the same in cases where more than one jurisdiction is entitled to a share of such tax shall be determined and the valuation of such property for taxation shall be ascertained in accordance with the provisions of this title.

The Department of Revenue shall apportion the value of such franchise or intangible property thus ascertained as in this title provided among and between the counties and cities, towns, school districts, or other tax districts having a special assessment, in which such person, association, company, or corporation does business, in proportion to the amount of business done in and receipts derived from each locality, except in case of a railroad or railway company, which apportionment shall be on single track main line basis, telephone or telegraph companies and electric power companies on pole or wire mileage, pipelines and car companies other than express companies on mileage basis.

The said property shall thereupon be entered by the county tax assessor and the local authorities of such city or town for taxation in like manner as other property and shall be taxed, and the taxes thereon shall be collected as in the case of other property.

Repealed by Act 99-665, 2nd Sp. Sess., § 9. As to effective date, see the Code Commissioner's Notes in the code supplement.

In any assessment by a state, county, or municipal authority of the franchise or intangible property of any person, association, company, or corporation subject to the provisions of this title, it shall be sufficient to describe the franchise or intangible property herein made subject to taxation on the assessment books or rolls as intangible property in (here give name of county, city, town, school district or other tax district) of the franchise or intangible tax of (here give name of owner of such franchise or intangible property).

If any person, association, company or corporation embraced within the provisions of this chapter shall fail to make the returns and statements, or any of them, required by the provisions of this chapter, or to furnish any other information lawfully required of it within the time limited, the Department of Revenue must procure the necessary information from some other sources upon which to base an ascertainment of the values of the tangible and intangible property or franchise of such person, association of persons, company, or corporation, and shall proceed to ascertain the value of such property.

If the property of any person, association, company, or corporation shall be in the hands of any receiver, assignee, trustee in bankruptcy or other person holding under any court, or for the benefit of any creditor or creditors, then the statements, reports, information, books, and papers aforesaid shall be furnished by said receiver, assignee, trustee or other person, or by some officer or agent acting under him, in the same manner and to the same extent as is hereinbefore provided in cases where the individual or the corporation, company or association is in possession.

(a) The Department of Revenue, after having first determined and fixed the true value of any property within this state of individuals, companies, corporations, and associations embraced within and in accordance with the provisions of this chapter, shall annually on or before July 1, or as soon thereafter as practicable, report to the tax assessor of every county and to the proper local authorities of each municipality in this state in which any part of said property is taxable hereunder, giving a general description of the property, the value of such property apportioned to said county and to said municipality, school district, or other district having a special assessment and the name and residence or place of business of the owner and all other necessary particulars.

(b) The assessor must enter in the book of assessments, in addition to the assessment of other real estate or personal property to be assessed as other taxable property owned by private citizens of his county, the property with description and value as reported to him by the Department of Revenue.

(c) The Department of Revenue shall also send to the owner or operator of such property so assessed a copy of its notification to the tax assessor touching assessment.

For each person operating a public utility, such as a street railroad or interurban railroad operated by electricity or other motive power, waterworks, gas company, pipeline company for transporting or carrying gas, oil, gasoline, water or other commodities, gas distributing companies, whether by means of pipeline or by tanks, drums, tubes, cylinders or otherwise, heating companies or other public utility, except electric, hydroelectric, telephone or telegraph companies, railroad or sleeping car companies and express companies which are otherwise licensed, shall pay to the state a license tax equal to two and two-tenths percent on each $1 of gross receipts of such public utility in this state for the preceding year. For the first year's business, where an existing public utility is taken over, such license tax payable to the state shall be equal to two and two-tenths percent on each $1 of the gross receipts for the preceding year of the public utility taken over, less whatever sum the prior operators have paid as such license tax on the gross receipts for that year. Where no existing public utility is taken over, such license tax for the first year, as well as for the second year, shall be based on the first year's business, but shall in no event be less than $100 for the first year's business; provided, that where business is started after April 1 the payment shall be not less than $50. Any person establishing a new public utility shall pay to the state the sum of $100 where operation is begun between October 1 and April 1 and $50 when operation is begun after April 1 and shall also at the same time execute a bond, payable to the State of Alabama, to insure payment of whatever sum, in addition to the $100 or $50, which may be due when, at the end of the first year or if operation began after April 1, the amount of the gross receipts is ascertainable. Such license tax shall be paid to the Department of Revenue by check made payable to the treasurer and shall be paid quarterly, one fourth on October 1, one fourth on January 1, one fourth on April 1 and one fourth on July 1 and shall become delinquent on the fifteenth day of each said month, based upon gross receipts for the preceding year, or half year if operations began after April 1. The payment of such license shall be accompanied by a sworn statement made on forms furnished by the Department of Revenue by the president, manager or operating officer of the public utility, or by the owner, receiver, or trustee thereof, giving the name of the person, firm, or corporation owning and operating said public utility and the principal place of business thereof, showing the gross receipts of such public utility for the preceding year. The books of every person operating a public utility shall be at all times open to the inspection of the Department of Revenue. Any person failing to make such sworn statement or willfully making a false statement of the gross receipts of such public utility shall be guilty of a misdemeanor and upon conviction shall be fined not exceeding $500 and shall also forfeit to the state three times the amount of the license on said utility, but no license under this schedule shall be paid to the county or counties.

All revenues collected under the provisions of Section 40-21-50 shall, after deduction of the cost of collection, be distributed in the following manner:

(1) Eighty-five percent of the balance remaining after deduction of the cost of collection shall be deposited in the Special Mental Health Fund to be used for mental health purposes; and

(2) Fifteen percent of the balance remaining after deduction of the cost of collection shall be deposited in the State General Fund.

Any person, firm, joint-stock association, or corporation, wherever organized or incorporated, engaged in the business of operating, renting, leasing, or furnishing cars not otherwise listed for taxation in this state for the transportation of freight, whether such freight is owned by such company or any other person, firm, joint-stock association, or corporation, over any railroad or railway line or lines in whole or in part within this state, such line or lines not being owned, leased, or operated by such person, firm, joint-stock association, or corporation, whether such cars are termed box, flat, coal, ore, tank, stock, gondola, furniture, automobile, refrigerator, or some other name, shall be deemed to be a freight line or equipment company. Each freight line or equipment company doing business, owning, operating, renting, leasing, or furnishing cars which are operated in this state shall, on or before March 1 each year, make and file with the Department of Revenue on a form or forms prescribed by the Department of Revenue a statement under oath by its president, secretary, treasurer, superintendent, manager, receiver, trustee, or owner, showing the number of miles run by all its cars over the line or lines of each separate railroad or railway in this state, naming each separate railroad or railway, and the total number of miles run by all of its cars over all line or lines of all railroads or railways in this state, and the total number of miles run by its cars over line or lines or railroads or railways everywhere outside of this state, such mileage to be shown as made for the 12-month period preceding October 1 of each year. There shall be shown on the statement the principal place of business, together with the street address of each freight line or equipment company, together with the names and addresses of persons to whom correspondence or tax notice should be sent. It shall be the duty of the Department of Revenue to examine the statement of each freight line or equipment company, and the reports of each railroad or railway company over whose lines such freight line or equipment moved, and from such statements and reports to compute the average number of cars within the state of each freight line or equipment company for the 12 months preceding October 1 of each year; for the average number of cars found to be in the state for such 12-month period, the reasonable value of such cars shall be computed, and the sum total value of the average number of cars shall be reduced to 30 percent thereof. There is hereby levied and it shall be the duty of the Department of Revenue to assess a license tax of three and one-half percent of the 30 percent value of the average number of cars within the state for the period of 12 months preceding October 1 of each year. Such tax shall be assessed pursuant to the procedures for assessment of tax as set out in Chapter 2A of this title.

The tax shall become due on the date of entry of the preliminary assessment and shall be delinquent 30 days after the due date. The tax shall be paid to the Department of Revenue, by check made payable to the Treasurer, and the license tax so paid shall be placed to the credit of the State General Fund. Each railroad or railway company in this state shall also, annually before March 1 of each year, make and file with the Department of Revenue, under oath of some executive officer of the company and on forms prescribed by the Department of Revenue, a report containing as to all its lines in Alabama all the data required of freight line or equipment companies and any additional information deemed necessary by the Department of Revenue. Any person, firm, corporation, or association operating, renting, leasing, or otherwise furnishing cars as above mentioned, except a regularly organized and operated railroad, is deemed to be a freight line equipment company.

(a) Each person, firm, or corporation, including any corporations operating an electric or hydroelectric public utility or gas public utility or any other public or municipal utility now paying the two and two-tenths percent shall be subject to the provisions of this section and shall pay to the state a license tax equal to two and two-tenths percent on each $1 of gross receipts of such public utility for the preceding year; except, that gross receipts from the sale of electricity for resale by such electric or hydroelectric public utilities and gross receipts from the sale of electricity to the persons identified in subsection (b) of this section shall be deducted in computing the amount of tax due hereunder. For the first year's business, where an existing electric public utility is taken over, such license tax payable to the state shall be equal to two and two-tenths percent on each $1 of gross receipts for the preceding year of the electric utility taken over, after deduction of gross receipts derived from sales of electricity for resale and gross receipts from the sale of electricity to the persons identified in subsection (b) of this section and less whatever sum the prior operators shall have paid as such license tax on the gross receipts for that year. Where no existing electric public utility is taken over, the license tax for the first year upon such utility shall be based upon the first year's business, computed as provided hereinabove, but shall in no event be less than $100 for the first year's business. Any person, firm, or corporation establishing a new electric public utility shall pay to the state the sum of $100 and shall also at the same time execute a bond payable to the State of Alabama to insure payment of whatever sum in addition to such $100 may be due when, at the end of the first year the amount of gross receipts for the year is ascertainable. Such license tax shall be paid to the Department of Revenue by check made payable to the Treasurer and shall be paid quarterly, one fourth on October 1, one fourth on January 1, one fourth on April 1 and one fourth on July 1 and shall become delinquent on the fifteenth day of each of said months. Payment shall be accompanied by a statement made by the president or other officer of the public utility or by the owner thereof, giving the name of the person, firm, or corporation owning and operating such public utility and the principal place of business thereof, together with a statement under oath of the amount of gross receipts of such public utility for the preceding year. The books of every person, firm, or corporation operating such public utility shall be at all times open to the inspection of the Department of Revenue. Any person failing to make such sworn statement or willfully making a false statement of the gross receipts of such public utility shall be guilty of a misdemeanor and, upon conviction thereof, shall be fined not exceeding $500 and shall also forfeit to the state three times the amount of the license for such public utility, but no license under this schedule shall be paid to the county or counties.

(b)(1) On or after October 1, 1981 any person who is 62 years of age or older or totally and permanently disabled and such person is head of a household and does not share his or her residence with more than one other adult person who is less than 62 years of age and who receives electricity at such residence from a utility which is subject to the 2.2 percent license tax levied in subsection (a) of this section shall be entitled to qualify, in accordance with the provisions of subdivision (2) of this subsection, for a credit on his or her monthly electric bill in the amount of the exemption from the 2.2 percent license tax with respect to sales of electricity to such person provided in subsection (a) of this section; provided that the combined gross incomes of all persons who live at the residence of such person 62 years of age or older or such totally and permanently disabled person shall not exceed $12,000 annually. Eligibility for this credit applies only to the extent and amount that it is billed to the customers as a normal requirement under its rates.

(2) Any person who seeks to qualify for the credit provided in subdivision (1) of this subsection shall make application to the Department of Human Resources in accordance with the rules promulgated by the Department of Human Resources for the implementation and enforcement of this section. The Department of Human Resources shall periodically notify, in writing, each electric utility in the state which is subject to payment of the 2.2 percent license tax levied in subsection (a) of this section regarding those customers who are entitled to receive the monthly credit. Within 45 days after receipt of notification for such monthly credit the electric utility shall commence providing such credit for gross receipts license tax that otherwise would be billed.

(3) Any person who wrongfully qualifies for such exemption by giving false information shall be guilty of a misdemeanor and upon conviction may be fined not to exceed $500.

The provisions of any state, county or municipal ordinance or law to the contrary notwithstanding, the tax levied and collectible pursuant to Section 40-21-53 shall be deductible from and shall not constitute a part of gross receipts for purposes of computing the amount due under any state, county or municipal tax, excise, license, or fee which is based upon or measured by the gross receipts of any person, firm, municipality, or corporation operating an electric or hydroelectric public utility subject to the tax levied by said section.

All revenues collected under the provisions of Section 40-21-53 shall, after deduction of the cost of collection, be distributed in the following manner:

(1) Eighty-five percent of the balance remaining after deduction of the cost of collection shall be deposited in the Special Mental Health Fund to be used for mental health purposes; and

(2) Fifteen percent of the balance remaining after deduction of the cost of collection shall be deposited in the General Fund.

In addition to all other taxes of every kind now imposed by law or otherwise imposed by this title, there is hereby levied a license or privilege tax upon each person, firm, corporation, agent or officer engaged in the business of manufacturing and selling hydroelectric power in the State of Alabama for the privilege of engaging in such business; said license or privilege tax shall be due and payable in advance, on or before September 25 of each year, and shall be in sum equal to two fifths of a mill upon each kilowatt hour of hydroelectric power manufactured and sold during the preceding calendar year.

In addition to all other taxes of every kind imposed by this title, there is hereby levied a license or privilege tax upon each person engaged in the business of operating an express company in the State of Alabama for the privilege of engaging in such business; said license or privilege tax shall be due and payable to the Department of Revenue by check made payable to the Treasurer annually in advance, on or before October 1 of each year, and shall be in a sum equal to two and one-half percent of the gross receipts of such express company from all the intrastate business within the State of Alabama during the preceding calendar year.

There shall be levied and collected from every person doing an express business between points wholly within this state and without reference to its interstate business, whether incorporated under the laws of this state or any other state or whether incorporated at all, a license or privilege tax of $4,000, which shall be paid to the Department of Revenue by check made payable to the Treasury by said company on or before the expiration of the fifteenth day of each fiscal year; provided, that any express company which operates on less than 50 miles of railroad, street railway, motor line, or boat line shall pay an annual tax of $250; and provided, that any express company which operated on 50 miles of railroad, street railway, motor line, or boat line, and less than 200 miles of railroad, street railway, motor line or boat line, shall pay an annual license of $500; and provided further, that all express companies that operate on 200 and not over 500 miles shall pay an annual tax of $2,500. It is not intended that the taxpayer under this section and Section 40-21-60 shall pay both the taxes therein mentioned, but that the taxpayer shall pay the larger of the two. The tax levied by this section and Section 40-21-60 shall not apply to bus lines which pay a license and mileage tax under Chapter 19 of this title and which carry express as a regular part of their business of hauling passengers.

In all cases where a public utility is required under this title to pay a privilege or license tax on gross receipts, such public utility shall make report to the Department of Revenue of such gross receipts to which such tax is applicable in a manner and form which will show the correct and true amount of such gross receipts upon which the tax is computed.

The Department of Revenue shall, upon receipt of any amount of money due for tax on gross receipts of any public utility, mail to such utility paying the tax a receipt therefor. Such a receipt shall state specifically the section of this title levying the tax for which such receipt is given.

No county shall levy a privilege or license tax on any business or occupation on which a privilege or license tax is levied by this article or on any telephone or telegraph utility business.

(a) For the purpose of this article, the following terms shall have the respective meanings ascribed by this section:

(1) DEPARTMENT. The Department of Revenue of the State of Alabama.

(2) DOMESTIC WATER. All water except water that is sold to persons for use or consumption in industrial processes and not primarily for human consumption.

(3) GROSS RECEIPTS. The value proceeding or accruing from the furnishing of utility services, all receipts actual and accrued, without any deduction on account of the cost of the utility services sold, the cost of the materials used, labor or service cost, interest paid, or any other expenses whatever, and without any deductions on account of losses.

(4) GROSS SALES. The value proceeding or accruing from the furnishing of utility services, and including the proceeds from the sale of any utility services handled on consignment by the taxpayer, without any deduction on account of the cost of the utility services sold, the cost of the materials used, labor or service cost, interest paid, or any other expenses whatever, and without any deductions on account of losses.

(5) PERSON. An individual, firm, copartnership, association, trust, receiver, corporation, or other entity, and shall specifically include the State of Alabama, every county in the State of Alabama, every municipal corporation in the State of Alabama, the United States of America and its agencies, and every public corporation or entity organized under the laws of the United States of America or under the laws of any state of the United States of America and operating in the State of Alabama, as well as every private or nonpublic entity.

(6) RETAIL SALE. All sales except those defined herein as wholesale sales.

(7) TAXPAYER. Any person liable for taxes under the provisions of this article.

(8) UTILITY. Every person regularly engaged in furnishing utility services to another person in the State of Alabama.

(9) UTILITY SERVICES. Electricity, domestic water, natural gas, telegraph services, and telephone services; provided, however, that 'utility services' shall not mean electricity, domestic water, natural gas, telephone services, or telegraph services stored, used, or consumed by a utility regularly engaged in furnishing the same such service to the public.

(10) WHOLESALE SALE. A sale or exchange of utility services by a utility to any person or any other utility engaged in the resale of such utility services in the regular course of business.

(11) TELEPHONE SERVICES. Local telephone service, interstate telephone service which originates or terminates within this state but does not both originate and terminate in this state and is charged to a service address in this state, and intrastate toll telephone service, private communications service, teletypewriter, and computer exchange service. The term 'telephone services' includes transmission by or through any media such as wires, cables, microwaves, light waves, or any combination of those or similar media. It includes, but is not limited to, telephone services sold by motels and hotels to their customers or to others, telephone services sold by colleges and universities to their students or to others, and telephone services sold by hospitals to their patients or to others. The term 'telephone services' shall not include:

(i) Telephone services provided through any pay telephone;

(ii) Any excise, franchise, or similar tax or like fee or assessment levied by the United States, by the State of Alabama, or by any political subdivision, upon the purchase, sale, use, or consumption of any telephone services, which tax, fee, or assessment is collected by the seller from the purchaser;

(iii) The furnishing of any telephone services for resale, including access charges paid by an interexchange carrier, provided that any utility making a sale of telephone services for resale shall obtain a certificate from the purchaser of such services certifying that such services are purchased for the purpose of resale, the form of the certification to be determined by rules and regulations to be promulgated by the department;

(iv) Charges for customer premises equipment, including such equipment that is leased or rented by the customer from any source;

(v) Cable television service, paging services, specialized mobile radio, or mobile telecommunications service; or

(vi) Services which are ancillary to the provision of telephone service but are not directly related to the transmission of voice, data, or information such as directory advertising and installation and repair of equipment and inside wiring.

The term 'local telephone service' means the access to a local telephone system, and the privilege of telephonic-quality communication with substantially all persons having telephone stations constituting a part of such local telephone system.

The term 'toll telephone service' means (A) a telephonic-quality communication for which there is a toll charge which varies in amount according to the distance and elapsed transmission time of each individual communication, or (B) a service that entitles the subscriber or user, upon the payment of a periodic charge that is determined as a flat amount or upon some basis of total elapsed transmission time, or upon some combination thereof, to the privilege of an unlimited number of telephonic communications to or from all or a substantial portion of the persons having telephone or radio telephone stations in a specified area which is outside the local telephone system area in which the station provided with this service is located. The term 'toll telephone service' includes wide-area telephone service charges.

The term 'private communications service' means a communication service that entitles the subscriber or user to exclusive or priority use of a communication channel or group of channels, regardless of whether such channel or group of channels may be connected through switching with a service described in this subparagraph.

The terms 'teletypewriter' and 'computer exchange service' mean the access from a teletypewriter, telephone, computer, or other data station of which such station is a part, and the privilege of intercommunication by such station with substantially all persons having teletypewriter, telephone, computer, or other data stations constituting a part of the same teletypewriter or computer exchange system. The terms 'teletypewriter' and 'computer exchange service' do not include the storage of data or information for subsequent retrieval, the retrieval of data or information, or the processing, or reception and processing, of data or information intended to change its form or content, and the term 'computer exchange service' shall not include access to the Internet.

The term 'intrastate,' as applied to telephone services, includes only those services originating and terminating wholly in this state.

(b) 'Herein,' 'hereby,' 'hereunder,' 'hereof,' and other such words of reference shall refer to this article as a whole, and not solely to the particular section or portion of this article in which any such word may be used.

(c) The definitions set forth in this section shall be deemed applicable whether the words defined are used in the singular or the plural.

It is the intention of the Legislature of Alabama that the tax herein levied shall apply to all utilities, as defined herein, in the State of Alabama. With respect to every tax exemption which may be enacted into law subsequent to the enactment of this article, there shall be a presumption that such exemption does not apply to the tax herein levied unless the statute containing such exemption shall make a specific reference to this article and shall clearly show a legislative intention to make such exemption applicable to the tax herein levied.

(a) There is hereby levied, in addition to all other taxes of every kind now imposed by law, and shall be collected as herein provided, a privilege or license tax against every utility furnishing electricity, domestic water, or natural gas in the State of Alabama. The amount of said tax shall be determined by the application of rates against gross sales or gross receipts, as the case may be, from the furnishing of such services in the State of Alabama. The tax shall be computed monthly with respect to each person to whom such services are furnished, in accordance with the following table:

(b) There is hereby levied a privilege or license tax against every utility furnishing telegraph or telephone services in the State of Alabama. The amount of said tax shall be determined by the application of rates against gross sales or gross receipts, as the case may be, from the furnishing of such services in the State of Alabama. The tax shall be applied to interstate telephone service beginning with bills dated on and after February 1, 2002, regardless of when the services being billed were provided. The tax shall be computed monthly with respect to each person to whom such services are furnished, in accordance with the following table:

Beginning with bills dated on or after April 1, 2002, the tax shall be computed at the rate of six percent on all gross sales or gross receipts. The utility furnishing such telegraph or telephone services shall be entitled to deduct and retain from the gross amount of tax billed by the utility nine-tenths of one percent of the amount of such tax billed on or after February 1, 2002, in consideration of the costs incurred by the utility in collecting and remitting the tax levied by this subsection; provided, however, that on and following October 1, 2002, the amount deducted and retained by such utility shall be one-fourth of one percent of the gross amount of such tax billed.

(c) If charges for a nontaxable service are aggregated with and not separately stated from charges for telephone or telegraph service that are subject to taxation, then the charges for the nontaxable service are subject to taxation unless the utility can reasonably identify the charges not subject to taxation from its books and records that are kept in the regular course of business.

(d) The provisions of subsection (c) do not create any customer right to require that, for purposes of determining the amount of tax applicable to a transaction, either the utility or the department allocate or attribute the bundled charge to the different portions of the transaction in order to minimize the amount of tax charged to the customer.

(a) Smith's Water Authority in Lee County, Alabama, is exempt from all taxes levied under Section 40-21-82.

(b) The Northeast Crenshaw Water and Fire Protection Authority in Crenshaw and Montgomery Counties, Alabama, is exempt from all taxes levied under Section 40-21-82.

(c) The Bakerhill Water Authority in Barbour County, Alabama, is exempt from all taxes levied under Section 40-21-82.

(d) The Russell County Water Authority is exempt from all taxes levied under Section 40-21-82.

(e) The Chambers County E911 Authority is exempt from all taxes levied under Section 40-21-82.

There are specifically excluded from the gross receipts or gross sales of a utility, all revenues derived from any of the following:

(1) The furnishing of utility services which the State of Alabama is prohibited from taxing under the Constitution or laws of the United States of America or the Constitution of the State of Alabama.

(2) The furnishing of utility services which are otherwise taxed under Sections 40-23-1 to 40-23-36, inclusive.

(3) Wholesale sales.

(4) The furnishing of electricity, natural gas, or domestic water for use or consumption by, in, or for the direct production, generation, processing, storage, delivery, or transmission of electricity, natural gas, or domestic water.

(5) The furnishing of electricity to a manufacturer or compounder for use in an electrolytic or electrothermal manufacturing or compounding process.

(6) The furnishing of natural gas to a manufacturer or compounder as a chemical raw material in the manufacturing or compounding of tangible personal property, but not as fuel or energy.

(7) The furnishing of natural gas to be used by a manufacturer or compounder to chemically convert raw materials prior to the use of the converted raw materials in an electrolytic or electrothermal manufacturing or compounding process.

(8) The use or consumption of electricity by an incorporated municipality, a board, or corporation organized under the authority of any incorporated municipality in furnishing or providing street lighting or traffic-control systems; the use or consumption of telephone services by an incorporated municipality in providing fire alarm systems; and the use or consumption of domestic water by an incorporated municipality in extinguishing fires, explosions, or conflagrations.

(9) The furnishing of natural gas or electricity for use or consumption as fuel or energy in and for the heating of poultry houses.

(10) The furnishing of utility services through the use of a prepaid telephone calling card.

Any person regularly engaging in any business for which a privilege tax is imposed by Section 40-21-82 shall apply for and obtain from the department a license to engage in and to conduct the business of furnishing utility services for the then current tax year. Such license shall be granted upon the condition that the applicant must pay all taxes accruing to the State of Alabama under the provisions of this article; provided, however, that no such license shall be issued to any person who has not complied with the provisions of this article. No provision of this article shall be construed as relieving any person from the payment of any license or privilege tax now or hereafter imposed by law.

(a) The provisions of this article shall be administered and the tax herein levied shall be collected in accordance with the uniform procedures set forth in this title, along with the procedures set forth in Division 1 of Article 1 of Chapter 23 of this title, for administering and collecting the tax therein levied, and for such purposes there are hereby incorporated into this article by reference the provisions of Sections 40-23-8 through 40-23-12, 40-23-25 and 40-23-27 through 40-23-31, together with the definitions applicable to said sections contained in Section 40-23-1; provided, that in the event of the repeal of such division, such repeal shall not operate to eliminate the tax collection procedures contained therein to the extent they are incorporated in this article by reference, unless the legislation providing for such repeal shall clearly indicate such a result.

The taxes herein levied shall be due and payable as follows:

(1) Any taxpayer liable for taxes under the provisions of this subdivision whose average monthly tax liability was less than $10,000 during the preceding calendar year shall remit such taxes in accordance with Section 40-23-7.

(2) Any taxpayer liable for taxes under the provisions of this subdivision whose average monthly tax liability was $10,000 or greater during the preceding calendar year shall make estimated payments to the Revenue Department on or before the twentieth day of the month in which the liability occurred.

(b) The amounts of the payment shall be at least equal to the taxpayer's actual tax liability for the same calendar month of the preceding year.

(c) Any outstanding credit or deficit arising from the taxpayer's overpayment or underpayment of its final liability shall be applied to either increase or reduce, as the case may be, that month's final tax liability which shall be reported and paid not later than the twentieth of the month next succeeding the month in which the tax accrues. The provisions of Section 40-23-7 shall apply to the filing of the monthly tax liability report.

(d) In those instances where a taxpayer due to divestiture compliance with a lawful order of a court of competent jurisdiction, or the sale of a portion of the business on which said tax is applicable, where such divestiture compliance or sale reduces the gross revenues of the taxpayer, the Commissioner of Revenue shall determine for a period of 12 months following such divestiture compliance or sale the monthly estimated tax liability and shall consider among others, the financial historical data and the percentage of divestiture or sale of said business of the taxpayer. Following the 12-month period, taxes shall be remitted in accordance with subsection (c) of this section.

(e) In those instances where there is no preceding calendar year for purposes of determining the tax liability of any taxpayer, the Commissioner of Revenue shall determine for a period of 12 months the monthly estimated tax liability for the taxpayer. Following the 12-month period, taxes shall be remitted in accordance with subsection (c) of this section.

Section 40-21-86

Responsibilities of utilities.

Every person engaged in the State of Alabama in the furnishing of utility services shall add to the price or charge for such utility services to every purchaser thereof an amount equal to the prescribed percentage of the gross price or gross charge therefor and shall collect said amount from every purchaser of such utility services. It shall be unlawful for any person furnishing utility services to fail or refuse to collect from the purchaser the amount required by this section to be collected, and it shall likewise be unlawful to refund or offer to refund all or any part of the amount collected or to absorb or advertise directly or indirectly the absorption or refund of said amount or any portion thereof. The provisions of this section that the tax herein levied shall be collected from the purchaser shall in no way relieve any utility of the tax herein levied; nor shall the inability, impracticability, refusal, or failure so to collect from such purchaser the amounts provided herein relieve such utility of the tax herein levied. All taxes paid in pursuance of this article shall be conclusively presumed to be a direct tax on the purchaser precollected for the purpose of convenience and facility only.

(Acts 1969, Ex. Sess., No. 21, p. 46, §7A; Acts 1992, No. 92-623, p. 1466, §6.)

All taxes or other funds received or collected by the Department of Revenue of the State of Alabama under the provisions of this article remaining after the payment of the expenses of administration and enforcement of this article shall be without delay deposited into the State Treasury to the credit of Education Trust Fund except that, beginning the fiscal year ending September 30, 1993, $14,600,000 annually shall be deposited to the Special Mental Health Trust Fund, of which one-fourth is to be deposited quarterly.

Any law to the contrary notwithstanding, any retailer, who relies in good faith on any state utility gross receipts tax exemption number that has been authorized by the Department of Revenue and the exemption claim has been made on a form provided or approved for use by the Department of Revenue, when a state tax exemption number holder violates the tax exempt privileges or uses the number illegally, shall not be liable to the Department of Revenue or others for the utility gross receipts tax on sales to the purchaser.

(a) For the purpose of this article, the following terms shall have the respective meanings ascribed by this section:

(1) BUSINESS. All activities relating to the furnishing of utility services.

(2) DEPARTMENT. The Department of Revenue of the State of Alabama.

(3) DOMESTIC WATER. All water except water that is sold to persons for use or consumption in industrial processes and not primarily for human consumption.

(4) GROSS RECEIPTS. The value proceeding or accruing from the furnishing of utility services, all receipts actual and accrued, without any deduction on account of the cost of the utility services sold, the cost of the materials used, labor or service cost, interest paid, or any other expense whatever, and without any deductions on account of losses.

(5) GROSS SALES. The value proceeding or accruing from the furnishing of utility services, and including the proceeds from the sale of any utility services handled on consignment by the taxpayer, without any deduction on account of the cost of the utility services sold, the cost of the materials used, labor or service cost, interest paid, or any other expenses whatever and without any deductions on account of losses.

(6) PERSON. An individual, firm, copartnership, association, trustee, receiver, corporation, or other entity, and shall specifically include the State of Alabama, every county in the State of Alabama, every municipal corporation in the State of Alabama, the United States of America and its agencies, and every public corporation or entity organized under the laws of the United States of America or under the laws of any state of the United States of America and operating in the State of Alabama, as well as every private or nonpublic entity.

(7) PURCHASE. Utility services which are acquired, with or without consideration, whether such acquisition is effected by a transfer of title or of possession, or of both, or a license to use or consume, whether such transfer is absolute or conditional, and by whatsoever means the same shall have been effected.

(8) RETAIL SALE. All sales except those defined herein as wholesale sales.

(9) SALES PRICE. The total amount for which utility services shall have been sold, or, if not sold or sold for only a nominal amount, the fair market value thereof, valued in money, whether paid in money or otherwise, and includes any amount for which credit is given to the purchaser by the seller, without any deduction therefrom on account of the cost of the utility services sold, the cost of the materials used, labor or service cost, interest charged, losses, or any other expenses whatever; provided, that cash discounts allowed and taken shall not be included.

(10) STORAGE. Any keeping or retention in the State of Alabama of utility services for any purpose, except sale in the regular course of business or subsequent use solely outside the State of Alabama.

(11) TAXPAYER. Any person liable for taxes under the provisions of this article.

(12) USE. The exercise of any right or power over utility services or the disposition thereof incident to a proprietary or possessory interest therein, except that it shall not include the sale of utility services in the regular course of business.

(13) UTILITY. Every person regularly engaged in furnishing utility services to another person in the State of Alabama.

(14) UTILITY GROSS RECEIPTS TAX. The tax levied by Article 3 of this chapter.

(15) UTILITY SERVICES. Electricity, domestic water, natural gas, telegraph services, and telephone services; provided, however, that 'utility services' shall not mean electricity, domestic water, natural gas, telephone services, or telegraph services stored, used, or consumed by a utility regularly engaged in furnishing the same such services to the public, other than by a municipality or other municipal entities organized by a municipality.

(16) WHOLESALE SALE. A sale or exchange of utility services by a utility to any person or any other utility engaged in the resale of such utility services in the regular course of business.

(17) TELEPHONE SERVICES. Local telephone service, interstate telephone service which originates or terminates within this state but does not both originate and terminate in this state and is charged to a service address in this state, and intrastate toll telephone service, private communications service, teletypewriter, and computer exchange service. The term 'telephone services' includes transmission by or through any media such as wires, cables, microwaves, light waves, or any combination of those or similar media. It includes, but is not limited to, telephone services sold by motels and hotels to their customers or to others, telephone services sold by colleges and universities to their students or to others, and telephone services sold by hospitals to their patients or to others. The term 'telephone services' shall not include:

(i) Telephone services provided through any pay telephone;

(ii) Any excise, franchise, or similar tax or like fee or assessment levied by the United States, by the State of Alabama, or by any political subdivision, upon the purchase, sale, use, or consumption of any telephone services, which tax, fee, or assessment is collected by the seller from the purchaser;

(iii) The furnishing of any telephone services for resale, including access charges paid by an interexchange carrier, provided that any utility making a sale of telephone services for resale shall obtain a certificate from the purchaser of such services certifying that such services are purchased for the purpose of resale, the form of the certification to be determined by rules and regulations to be promulgated by the department;

(iv) Charges for customer premises equipment, including such equipment that is leased or rented by the customer from any source;

(v) Cable television service, paging services, specialized mobile radio, or mobile telecommunications service; or

(vi) Services which are ancillary to the provision of telephone service but are not directly related to the transmission of voice, data, or information such as directory advertising and installation and repair of equipment and inside wiring.

The term 'local telephone service' means the access to a local telephone system, and the privilege of telephonic-quality communication with substantially all persons having telephone stations constituting a part of such local telephone system.

The term 'toll telephone service' means (A) a telephonic-quality communication for which there is a toll charge which varies in amount according to the distance and elapsed transmission time of each individual communication, or (B) a service that entitles the subscriber or user, upon the payment of a periodic charge that is determined as a flat amount or upon some basis of total elapsed transmission time, or upon some combination thereof, to the privilege of an unlimited number of telephonic communications to or from all or a substantial portion of the persons having telephone or radio telephone stations in a specified area which is outside the local telephone system area in which the station provided with this service is located. The term 'toll telephone service' includes wide-area telephone service charges.

The term 'private communications service' means a communication service that entitles the subscriber or user to exclusive or priority use of a communication channel or group of channels, regardless of whether such channel or group of channels may be connected through switching with a service described in this subparagraph.

The terms 'teletypewriter' and 'computer exchange service' mean the access from a teletypewriter, telephone, computer, or other data station of which such station is a part, and the privilege of intercommunication by such station with substantially all persons having teletypewriter, telephone, computer, or other data stations constituting a part of the same teletypewriter or computer exchange system. The terms 'teletypewriter' and 'computer exchange service' do not include the storage of data or information for subsequent retrieval, the retrieval of data or information, or the processing, or reception and processing, of data or information intended to change its form or content, and the term 'computer exchange service' does not include the Internet nor access thereto.

The term 'intrastate,' as applied to telephone services, includes only those services originating and terminating wholly in this state.

(b) 'Herein,' 'hereby,' 'hereunder,' 'hereof' and other such words of reference shall refer to this article as a whole and not solely to the particular section or portion of this article in which any such word may be used.

(c) The definitions set forth in this section shall be deemed applicable whether the words defined are used in the singular or the plural.

It is the intention of the Legislature of Alabama that the tax herein levied shall be supplemental to and complementary with the utility gross receipts tax so as to prevent discrimination in the effect of the utility gross receipts tax upon either intrastate or interstate commerce. It is the intention of the Legislature of Alabama that the tax herein levied shall apply to purchases of utility services from any utility. With respect to every tax exemption which may be enacted into law subsequent to the enactment of this article, there shall be a presumption that such exemption does not apply to the tax herein levied unless the statute containing such exemption shall make specific reference to this article and shall clearly show a legislative intention to make such exemption applicable to the tax herein levied.

(a) There is hereby levied, in addition to all other taxes of every kind now imposed by law, and shall be collected as herein provided, an excise tax on the storage, use, or other consumption of electricity, domestic water, and natural gas in the State of Alabama. The amount of said tax shall be determined by the application of rates against the sales price of such services in the State of Alabama. The tax shall be computed monthly in accordance with the following table:

(b) There is hereby levied an excise tax on the storage, use, or other consumption of telegraph services or telephone services in the State of Alabama. The amount of said tax shall be determined by the application of rates against the sales price of such services in the State of Alabama. The tax shall be applied to interstate telephone service beginning with bills dated on or after February 1, 2002, regardless of when the services being billed were provided. The amount of said tax shall be computed monthly, in accordance with the following table:

Beginning with bills dated on or after April 1, 2002, the tax shall be computed at the rate of six percent. The utility furnishing such telegraph or telephone services shall be entitled to deduct and retain from the gross amount of tax billed by the utility nine-tenths of one percent of the amount of such tax billed on or after February 1, 2002, in consideration of the costs incurred by the utility in collecting and remitting the tax levied by this subsection; provided, however, that on and following October 1, 2002, the amount deducted and retained by such utility shall be one-fourth of one percent of the gross amount of such tax billed.

(c) Every person storing, using, or otherwise consuming utility services in the State of Alabama shall be liable for the tax imposed herein. Such liability shall not be extinguished until the tax has been paid to the State of Alabama.

(d) If charges for a nontaxable service are aggregated with and not separately stated from charges for telephone or telegraph service that are subject to taxation, then the charges for the nontaxable service are subject to taxation unless the utility can reasonably identify the charges not subject to taxation from its books and records that are kept in the regular course of business.

(e) The provisions of subsection (d) do not create any customer right to require that, for purposes of determining the amount of tax applicable to a transaction, either the utility or the department allocate or attribute the bundled charge to the different portions of the transaction in order to minimize the amount of tax charged to the customer.

The storage, use, or other consumption of utility services in the State of Alabama is hereby specifically excluded from the tax herein levied:

(1) Whenever the State of Alabama is prohibited from taxing such storage, use, or consumption under the Constitution or laws of the United States of America or the Constitution of the State of Alabama;

(2) Whenever any tax relating to the sale, use, storage, or consumption of said utility services shall be levied under the provisions of Article 2 of Chapter 23 of this title, or under the provisions of Sections 40-23-1 through 40-23-36 or the Alabama Transaction Tax Act of 1992 if enacted into law;

(3) Whenever the purchase of said utility services shall have been at a wholesale sale;

(4) Whenever electricity, natural gas, or domestic water shall have been used or consumed directly in or for the production, generation, processing, storage, delivery, or transmission of electricity, natural gas, or domestic water;

(5) Whenever electricity purchased for storage, use, or other consumption is used or consumed by a manufacturer or compounder in an electrolytic or electrothermal manufacturing or compounding process;

(6) Whenever natural gas purchased for storage, use, or other consumption is used or consumed by a manufacturer or compounder as a chemical raw material in the manufacturing or compounding of tangible personal property, but not as fuel or energy;

(7) Whenever natural gas purchased for storage, use, or other consumption is used by a manufacturer or compounder to chemically convert raw materials prior to the use of such converted raw materials in an electrolytic or electrothermal manufacturing or compounding process;

(8) Whenever the sales price of said utility services shall be included as a part of the gross receipts or gross sales of a utility subject to the utility gross receipts tax for the purpose of calculating the utility gross receipts tax payable by said utility;

(9) Whenever electricity purchased for storage, use, or other consumption is used or consumed in a process for the isotopic enrichment of uranium and when said electricity is purchased from a subsidiary corporation of the corporation engaged in the isotopic enrichment of uranium; and

(10) Whenever utility services are furnished through the use of a prepaid telephone calling card.

Every utility, except as hereinafter provided, engaged in making retail sales of utility services for storage, use, or other consumption in the State of Alabama shall register with the department and give the name and address of its officers and directors, the location of each of its offices in the State of Alabama, the names and addresses of all persons with whom said utility has contracts for furnishing utility services by said utility, the names and addresses of all persons who have purchased utility services from said utility during the then next preceding 12 months, the amounts of the sales prices of all utility services furnished by said utility and such other information as the department may require with respect to matters pertinent to the enforcement of this article; provided, that this section of this article shall not apply to persons holding a license under the provisions of the utility gross receipts tax; provided further, that this section of this article shall not apply to the United States of America or to any agency or department of the United States of America or to any corporation exempted from so registering with the department under the Constitution or laws of the United States of America.

Every seller making sales of utility services for storage, use, or other consumption in this state, not exempted under the provisions of Section 40-21-103, shall at the time of making such sales or, if the storage, use, or other consumption of the utility services is not then taxable hereunder, at the time such storage, use or other consumption becomes taxable hereunder, collect the tax imposed by this article from the purchaser and give to the purchaser a receipt therefor in the manner and form prescribed by the department. The tax required to be collected by the seller from the purchaser shall be displayed separately from the list, advertised in the premises, marked or other price on the sales check or other proof of sales. It shall be unlawful for any such seller to advertise or hold out or state to the public or to any customer, directly or indirectly, that the tax or any part thereof imposed by this article will be assumed or absorbed by the seller or that it will not be added to the selling price of the property sold or, if added, that it or any part thereof will be refunded. Any person violating any of the provisions of this section shall be guilty of a misdemeanor. The tax herein required to be collected by the seller shall constitute a debt owed by the seller to this state.

In the event that a seller making sales of utility services for storage, use or other consumption in this state, not exempted under the provisions of Section 40-21-103, is exempted from collection of the tax herein levied by any provisions of the Constitution or laws of the United States of America, then the purchaser of such utility services shall pay the said tax directly to the department each month pursuant to such regulations as the department may prescribe from time to time.

The tax herein levied shall be administered and collected in accordance with the uniform procedures set forth in this title, along with the procedures set forth for collecting the use tax described in Article 2 of Chapter 23 of this title, and for that purpose there are hereby incorporated into this article by reference the provisions of Sections 40-23-68, 40-23-74, 40-23-75, and 40-23-77, 40-23-82, 40-23-83, and 40-23-88; provided, that wherever in said provisions the words 'this article' shall appear, the same for the purposes of this article shall be construed to mean 'this article'; provided further, that wherever in said provisions reference shall be made to March 1, 1939, the same for the purposes of this article shall be construed to mean September 1, 1969; provided further, that wherever in said provisions reference shall be made to June 30, 1939, the same shall for the purposes of this article mean that certain day one calendar month subsequent to September 1, 1969; provided further, that none of the said provisions shall apply to the United States of America or to any agency or department of the United States of America; provided further, that the tax herein levied shall be collected monthly, and all reports and records respecting the said tax herein levied shall be made on a monthly basis; and, to that end, wherever in said provisions the word 'quarterly' shall appear, the same for the purpose of this article shall be construed to mean 'monthly'; and wherever in said provisions the words 'three months' shall appear, the same for the purposes of this article shall be construed to mean 'one month'.

All taxes or other funds received or collected by the Department of Revenue of the State of Alabama under the provisions of this article remaining after the payment of the expenses of administration and enforcement of this article shall be without delay deposited into the State Treasury to the credit of Alabama Education Trust Fund.

As used in this article, the following words and phrases shall have the following meanings respectively ascribed to them unless the context clearly indicates otherwise:

(1)a. CUSTOMER. The person or entity that contracts with the home service provider for mobile telecommunications service or, for the purposes of determining the place of primary use, if the end user of the mobile telecommunications service is not the contracting party, the end user of the mobile telecommunications service. The term does not include a reseller of mobile telecommunications service or a serving carrier under an arrangement to serve the customer outside the home service provider's licensed service area.

b. HOME SERVICE PROVIDER. The facilities-based carrier or reseller with which the customer contracts for the provision of mobile telecommunications service.

c. LICENSED SERVICE AREA. The geographic area in which the home service provider is authorized by law or contract to provide mobile telecommunications service.

d. MOBILE TELECOMMUNICATIONS SERVICE. Commercial mobile radio service, as defined in Section 20.3 of Title 47 of the Code of Federal Regulations as in effect on June 1, 1999.

e. MONTHLY CHARGES. The monthly recurring access charges and local airtime charges only. However, effective for customer bills dated on or after February 1, 2002, monthly charges shall be the monthly recurring access charges and all airtime charges, regardless of when the services being billed were provided.

f. PLACE OF PRIMARY USE. The street address representative of where the customer's use of the mobile telecommunications service primarily occurs, which must be the residential street address or the primary business street address of the customer and within the licensed service area of the home service provider.

g. RESELLER. A provider who purchases telecommunications services from another telecommunications service provider and then resells, uses as a component part of, or integrates the purchased services into a mobile telecommunications service. This term does not include a serving carrier with which a home service provider arranges for the services to its customers outside the home service provider's licensed service area.

h. SERVING CARRIER. A facilities-based carrier providing mobile telecommunications service to a customer outside a home service provider's or reseller's licensed service area.

i. TAXING JURISDICTION. This state or any political subdivision within this state, including those operating under a home rule charter, with the authority to impose a tax, charge, or fee.

(2) Mobile telecommunications service and providers are not included in and are excluded from the coverage and application of, and are not subject to, the provisions of Title 37, and the levy of taxes and assessment of property under Articles 1 through 4, inclusive, of Chapter 21 of this title.

(a) There is hereby levied, in addition to all other taxes of every kind now imposed by law, and shall be collected as provided herein, a privilege or license tax against every home service provider doing business in the State of Alabama on account of the furnishing of mobile telecommunications service to a customer with a place of primary use in the State of Alabama by said home service provider. The amount of the tax shall be determined by the application of the rates against gross sales or gross receipts, as the case may be, from the monthly charges from the furnishing of mobile telecommunications service to a customer with a place of primary use in the State of Alabama and shall be computed monthly with respect to each person to whom services are furnished at the rate of four percent on bills dated prior to February 1, 2002, and at the rate of six percent on bills dated on or after February 1, 2002, regardless of when the services being billed were provided. The home service provider furnishing such mobile telecommunications services shall be entitled to deduct and retain from the gross amount of tax billed by the home service provider nine-tenths of one percent of the amount of such tax billed on or after February 1, 2002, in consideration of the costs incurred by the home service provider in collecting and remitting the tax levied by this article; provided, however, that on and following October 1, 2002, the amount deducted and retained by such provider shall be one-fourth of one percent of the gross amount of such tax billed.

(b) Every home service provider subject to the tax herein levied in subsection (a) shall add to the price or charge for such services and collect from every customer thereof an amount equal to the prescribed percentage of gross price or gross charge therefor. It shall be unlawful for any home service provider to fail or refuse to collect from the customer the amount required by this section to be collected, to refund or offer to refund all or any part of the amount collected, or to absorb or advertise directly or indirectly the absorption or refund of the amount or any portion thereof. The provisions of this subsection that the tax herein levied shall be collected from the customer shall in no way relieve any home service provider of the tax herein levied. Nor shall the inability, impracticality, refusal, or failure so to collect from such customer the amounts provided herein relieve such provider of the tax herein levied. All taxes paid in pursuance of this section shall be conclusively presumed to be a direct tax on the customer precollected for the purpose of convenience and facility only.

(c) Monthly charges for mobile telecommunications service provided to a customer and billed by or for the customer's home service provider are deemed to be provided at the customer's place of primary use. Such monthly charges are subject to the tax imposed by this chapter if the customer's place of primary use is located in this state.

(d) If nontaxable charges for mobile telecommunications service are aggregated with and not separately stated from charges that are subject to taxation, then the charges for nontaxable mobile telecommunications service may be subject to taxation unless the home service provider can reasonably identify charges not subject to taxation from its books and records that are kept in the regular course of business.

(e) If charges for mobile telecommunications service are not subject to taxation, a customer may not rely upon the nontaxability of charges for mobile telecommunications service unless the customer's home service provider separately states the charges for nontaxable mobile telecommunications service from taxable charges or the home service provider elects, after receiving a written request from the customer in the form required by the provider, to provide verifiable data based upon the home service provider's books and records that are kept in the regular course of business that reasonably identifies the nontaxable charges.

(f)(1) A home service provider is to be held harmless from any tax, charge, or fee liability in this state that otherwise would be due solely as a result of an assignment of a street address to an incorrect taxing jurisdiction if, subject to subsection (i), the home service provider employs an enhanced zip code to assign each street address to a specific taxing jurisdiction for each level of taxing jurisdiction and exercises due diligence at each level of taxing jurisdiction to ensure that each street address is assigned to the correct taxing jurisdiction. If an enhanced zip code overlaps boundaries of taxing jurisdictions of the same level, the home service provider must designate one specific jurisdiction within the enhanced zip code for use in taxing the activity for the enhanced zip code for each level of taxing jurisdiction. Any enhanced zip code assignment changed in accordance with subsection (i) is in compliance with this subsection. For purposes of this subsection, there is a rebuttable presumption that a home service provider has exercised due diligence if the home service provider demonstrates that it has all of the following:

a. Expended reasonable resources to implement and maintain an appropriately detailed electronic database of street address assignments to taxing jurisdictions.

b. Implemented and maintained reasonable internal controls to promptly correct misassignments of street addresses to taxing jurisdictions.

c. Used all reasonably obtainable and usable data pertaining to municipal annexations, incorporations, reorganizations, and any other changes in jurisdictional boundaries that materially affect the accuracy of the database.

(2)a. The department may elect to provide an electronic database that satisfies the requirements of 4 U.S.C. § 119. If the department provides such database, a home service provider using the data contained in such database shall be held harmless from any liability, including tax, interest, and penalties, which would otherwise be due solely as a result of an assignment of a place of primary use to an incorrect local jurisdiction.

b. Paragraph a shall apply to a home service provider who is in compliance with the terms of such subdivision until the later of (i) 18 months after the approval described in 4 U.S.C. § 119(a), or (ii) 6 months after the department provides an electronic database that satisfies the requirements of 4 U.S.C. § 119.

(g) A home service provider is responsible for obtaining and maintaining the customer's place of primary use. Subject to subsection (i) and if the home service provider's reliance on information provided by its customer is in good faith, a taxing jurisdiction shall allow a home service provider to rely on the applicable residential or business street address supplied by the home service provider's customer and not hold a home service provider liable for any additional taxes, charges, or fees based on a different determination of the place of primary use for taxes, charges, or fees that are customarily passed on to the customer as a separate itemized charge.

(h) Except as provided in subsection (i), a taxing jurisdiction shall allow a home service provider to treat the address used by the home service provider for tax purposes for any customer under a service contract or agreement in effect on or before July 28, 2002, as that customer's place of primary use for the remaining term of the service contract or agreement, excluding any extension or renewal of the service contract or agreement, for purposes of determining the taxing jurisdictions to which taxes, charges, or fees on charges for mobile telecommunications service are remitted.

(i) A taxing jurisdiction or the state on behalf of any taxing jurisdiction may:

(1) Determine that the address used for purposes of determining the taxing jurisdictions to which taxes, charges, or fees for mobile telecommunications service are remitted does not meet the definition of place of primary use and give binding notice to the home service provider to change the place of primary use on a prospective basis from the date of notice of determination if the taxing jurisdiction making the determination is not the state, the taxing jurisdiction obtains the consent of all affected taxing jurisdictions within this state before giving the notice of determination, and before the taxing jurisdiction gives the notice of determination, the customer is given an opportunity to demonstrate in accordance with applicable state or local tax, charge, or fee administrative procedures that the address is the customer's place of primary use.

(2) Determine that the assignment of a taxing jurisdiction by a home service provider under subdivision (1) does not reflect the correct taxing jurisdiction and give binding notice to the home service provider to change the assignment on a prospective basis from the date of notice of determination if the taxing jurisdiction making the determination is not the state, the taxing jurisdiction obtains the consent of all affected taxing jurisdictions within the state before giving the notice of determination, and the home service provider is given an opportunity to demonstrate in accordance with applicable state or local tax, charge, or fee administrative procedures that the assignment reflects the correct taxing jurisdiction.

(j) Nothing in this section modifies, impairs, supersedes, or authorizes the modification, impairment, or supersession of any law allowing a taxing jurisdiction to collect a tax, charge, or fee from a customer that has failed to provide its place of primary use.

(k) If a customer believes that an amount of tax, charge, or fee or an assignment of place of primary use or taxing jurisdiction included on a billing is erroneous, the customer shall notify the home service provider in writing. The customer shall include in this written notification the street address for the customer's place of primary use, the account name and number for which a customer seeks a correction, a description of the error asserted by the customer, and any other information that the home service provider reasonably requires to process the request. Within 60 days of receiving a notice under this section, the home service provider shall review its records to determine the customer's taxing jurisdiction. If this review shows that the amount of tax, charge, or fee or assignment of place of primary use or taxing jurisdiction is in error, the home service provider shall correct the error and refund or credit the amount of tax, charge, or fee erroneously collected from the customer for a period of up to two years. If this review shows that the amount of tax, charge, or fee or assignment of place of primary use or taxing jurisdiction is correct, the home service provider shall provide a written explanation to the customer. The procedures in this section shall be the first course of remedy available to customers seeking correction of assignment of place of primary use or taxing jurisdiction, or a refund of or other compensation for taxes, charges, and/or fees erroneously collected by the home service provider, and no cause of action based upon a dispute arising from such taxes, charges, or fees shall accrue until a customer has reasonably exercised the rights and procedures set forth in this section.

There are hereby specifically excluded from the gross receipts or gross sales of a cellular provider, upon which the tax herein levied is calculated, all portions thereof derived from the following:

(1) The furnishings of cellular services which the State of Alabama is prohibited from taxing under the Constitution or laws of the United States of America or the Constitution of Alabama of 1901;

(2) The furnishing of cellular services which are otherwise taxed under the provisions of Sections 40-23-1 through 40-23-36;

(3) Wholesale sales; and

(4) The furnishing of cellular telecommunications service through the use of a prepaid telephone calling card, a prepaid authorization number, or both.

The tax herein levied shall be collected and administered in accordance with the procedure set forth in Section 40-21-85, and for those purposes the provisions of Section 40-21-85 are hereby incorporated into this section by reference. All tax revenue and other funds received or collected under subsection (a) of Section 40-21-121 shall be deposited into the State Treasury and used for the following purposes:

(1) So much thereof as necessary is hereby appropriated to be used by the State Treasurer to pay at their respective maturities the principal and interest due in the fiscal year on the outstanding bonds issued by the Alabama Revolving Loan Fund Authority.

(2) Beginning in March of 2002, one-third of the remaining proceeds, plus $1 million in the fiscal year ending September 30, 2002, and $1.5 million each fiscal year thereafter, shall be credited to the Education Trust Fund.

(3) The residual balance thereof remaining shall be credited to the State General Fund.

If any person after February 1, 1990 shall engage in or continue in any business for which a tax is imposed by this article, as a condition precedent to engaging or continuing in such business, the person shall apply for and obtain from the Department of Revenue of the State of Alabama a license to engage in and to conduct the business of furnishing cellular telecommunication services for the then current tax year upon the condition that he or she shall pay the taxes accruing to the State of Alabama under the provisions of this article. No license shall be issued under the provisions of this article to any person who shall not have complied with the provisions of this article, and no provision of this article shall be construed as relieving any person from the payment of any license or privilege tax now or hereafter imposed by law.

Any law to the contrary notwithstanding, any cellular telecommunication services provider, who accepts in good faith from a purchaser a cellular telecommunication services tax exemption form provided or approved for use by the Department of Revenue, shall not subsequently be liable to the Department of Revenue or others for the cellular telecommunication services tax on sales to that purchaser.

There is hereby levied a tax on mobile radio communication services as defined in Section 20.3 of Title 47 of the Code of Federal Regulations as in effect on June 1, 1999, at the same rate as the tax levied in Section 40-21-121, effective February 1, 2002. The Department of Revenue shall exercise its rulemaking authority to ensure that the application of this tax complies with all applicable federal laws and regulations.