Job tax possibly illegal

Published 2:29 pm Tuesday, June 23, 2009

When is a tax too taxing? Obviously, when it is the Jefferson County occupational tax.

How is it that residents of Shelby County and other neighboring counties have to pay a tax just because their jobs happen to be located in Jefferson County?

Why, if the courts have affirmed that this tax was repealed by the legislature in 1999, are some of our citizens still having this tax withheld from their paychecks?

It’s important to know that under the Alabama Constitution of 1901, counties do not have authority to levy taxes unless authorized by the Legislature.

Consequently, the Legislature enacted Act 1967-406 to authorize counties with populations above 500,000 to levy a license fee or privilege tax upon any person engaged in business, as long as that person was not already paying a license tax to the State of Alabama.

In 1987, the Jefferson County Commission decided that Act 1967-406 provided them the needed authority to enact the occupational tax on top of the business license fees already being collected.

At its very core, this tax is unfair and potentially unconstitutional in Alabama.

Applying the tax to residents of Shelby County and other counties, who receive no governmental representation from Jefferson County, is exactly why our forefathers believed in “no taxation without representation.”

The 25th Amendment to the state Constitution provides for a state income tax, but does not openly grant such authority to a county.

In my opinion, Act 1967-406 only provides for the collection of a business license tax or privilege tax, so any tax on gross receipts is an income tax and could be unconstitutional.

With a history of six lawsuits following the 1987 introduction of the occupational tax, it’s obvious this tax has always been on shaky legal ground.

Even though the most recent lawsuit brought against the occupational tax resulted in a decision that the legislature legally repealed the tax in 1999, no action was taken to suspend collection of the tax. The case is on appeal to the State Supreme Court.

Hopefully, the troubled history of the Jefferson County occupational tax is nearing a final resolution.