Madison joins online sales tax lawsuit against state
MADISON – Madison city council voted last week to join other cities, including Tuscaloosa, in suing the state of Alabama on Simplified Sellers Use Tax.
SSUT was implemented in 2015 as a means of collecting sales tax on online commerce. Tuscaloosa filed a lawsuit in August of this year against the state on the policy, alleging that SSUT “poses a significant financial threat to Alabama communities by diverting tens of millions of locally generated tax dollars away from essential public services each year,” according to the city’s website. Tuscaloosa Mayor Walt Maddox joined the Madison city council in a Dec. 3 work session for a presentation on SSUT and his city’s lawsuit. The city of Madison faced a Dec. 10 deadline to join the lawsuit when it voted on the issue at the December 8 council meeting.
“This resolution has two main functions. The first is to express support for the city of Tuscaloosa in its efforts to change the administration of the SSUT through litigation and secondly, it authorizes the city of Madison to join in that litigation,” stated Madison City Attorney Megan Zingarelli at the Dec. 8 meeting.
The resolution ultimately passed 5-2. Councilmembers McKay and Bier were the 2 ‘nay’ votes.
Madison city councilmembers collectively agreed that the city suffers from the current administration of SSUT and spoke in support of reform. McKay and Bier urged refraining from joining the lawsuit out concerns of monetary expense and potential damage to relationships with other governing bodies among other reasons.
“I do hope that we can consider another opinion not to join the lawsuit but a potential amendment that would support that we are interested in change and interested in a different path but not necessarily join the litigation,” said Councilman David Bier.
McKay explained part of his reasoning behind his ‘nay’ vote, “Number 1: of course, the more parties that enter this lawsuit provides safety in numbers or political cover to our city, but there’s no mistaking that this will be and is a polarizing lawsuit. I do not think Madison should get pulled into a narrative we did not create. Number 2: with us being pulled into that narrative, there is a real possibility this will affect our current and future relationships with other cities and the counties around us.”
“I feel like part of our responsibility that when we’re elected is we are to be good stewards of the resources that are given to us by our taxpayers, and that is not currently happening,” commented Councilwoman Maura Wroblewski who voted in favor of joining the lawsuit.
“The Madison taxpayer has a right to expect benefit from the taxes they pay. The current way SSUT law is being applied by ADOR diverts Madison tax dollars to other parts of the state,” stated Mayor Ranae Bartlett at the city council meeting.
Madison joins Huntsville City Schools, Tuscaloosa, Alabaster, Hoover, Pelham, Mountain Brook, Foley, and Mobile in the lawsuit.
