What is the sales tax in Alabama?
Combined rate, the threshold that makes you register, and the rules that decide what you charge.
The Alabama state sales tax rate is 4%. Local rates average 5.46%, for a combined average of 9.46%, and reach 12.5% in the highest jurisdictions. A remote seller has to register once sales into Alabama pass $250,000 in sales into the state over the previous calendar year. Charge the rate at the buyer’s address.
- State rate
- 4%
- Average local rate
- 5.46%
- Combined average
- 9.46%
- Highest in the state
- 12.5%
Do you have to register?
Economic nexus threshold
$250,000
Measured over the previous calendar year. Order count does not matter here, only the dollar figure. Physical presence — staff, an office, or stock sitting in a 3PL in the state — creates the obligation immediately, before any threshold applies.
What you charge, and on what
- Which address sets the rate Charge the rate at the buyer’s address.
- Is shipping taxed Depends how you state it. Delivery by common carrier is exempt when separately stated and shipment is optional to the buyer.
- Clothing Taxed at the same rate as everything else.
- Groceries Reduced rate
- Marketplace sales Amazon, Walmart, Etsy, and eBay collect and remit on the orders they process. Sales through your own store stay yours to collect on.
- Registering Register directly with the Alabama Department of Revenue. This state runs its own registration.
Worth knowing about Alabama
- Remote sellers can elect the Simplified Sellers Use Tax program and collect one flat 8% statewide instead of tracking every local rate.
- Local rates are collected by more than 300 separate jurisdictions, several of which self-administer.
Alabama sales tax questions
What is the sales tax rate in Alabama?
The state rate is 4%. Local jurisdictions add an average of 5.46% on top, which puts the typical combined rate at 9.46% and the highest at 12.5%. Because the rate follows the address, the figure you charge depends on where the order is going.
When does a remote seller have to register in Alabama?
Once sales into the state pass $250,000 in sales into the state over the previous calendar year. Order count does not matter here — the dollar figure is the only trigger. Physical presence, including inventory held at a 3PL in the state, creates the obligation immediately, before any threshold applies.
Is shipping taxable in Alabama?
Depends how you state it. Delivery by common carrier is exempt when separately stated and shipment is optional to the buyer.
Is clothing taxed in Alabama?
Clothing is taxed at the same rate as other goods. Alabama does not exempt apparel.
Where the authoritative number is
Rates and thresholds change, and the Alabama Department of Revenue sets them. Check there before you register or file.
Other states with a $250,000 threshold
Know before you cross the line
The threshold above is easy to read and hard to track, because it counts sales from your store, your marketplaces, and your wholesale accounts together. Endless keeps those on one source of truth, so what you have sold into Alabama this year is a number you already have rather than one you assemble after the fact.
This page is a reference, not tax advice. Confirm registration and filing decisions with the Alabama Department of Revenue or a tax professional.