Prescription drugs for human consumption are exempt from sales and use tax in the state of Alabama. However, a recent new release from the Alabama Department of Revenue reminds that prescriptions for animals are not tax exempt.
It doesn't matter where the drugs are purchased. Joe Walls, director of the ADOR Sales and Use Tax Division, notes that "[p]rescription items sold by licensed veterinarians, as well as prescription items sold by retail pharmacies, etc, for animal consumption are taxable."
Confusion has arisen because prescription drugs sold for human consumption are not subject to sales and use tax. In addition, medications are exempt "for livestock, poultry, or fish raised in commercial or farming enterprises."
Prescription drugs (for both humans and livestock) that are exempt from sales tax are listed in Code of Alabama 1975 Section 40-23-4.
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