Alabama now allows an exemption from sales tax for tangible personal property sold to, or used, consumed or stored by certain private educational institutions located in the state. House Bill 129 took effect April 7, 2014; the exemptions may be applied retroactively to “all open tax periods and all periods for which a preliminary or final assessment of tax could be entered,” under Alabama law.
Eligible private educational institutions are those that offer “conventional and traditional courses of study,” such as offered by public schools, colleges, or universities” in Alabama. Nursery schools, day care facilities and home schools are not eligible for the exemption. Presumably, private educational institutions offering unconventional or nontraditional courses of study are also ineligible.
The tax exemption applies to “lunches sold within school buildings” to kindergarten, grammar school and high school students, public or private, so long as the lunches are “sold not for profit.”
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