Decatur, AL Hotels & Lodging: Transient Occupancy Tax (2026)

Article IV of chapter 14 of the Code of Decatur, Alabama, levies a privilege or license tax on every person renting rooms or lodgings to transients inside the corporate limits, in addition to all other taxes. A transient is a person renting a room or lodging for less than 180 continuous days (§ 14-101). The tax reaches any hotel, motel, inn, tourist camp, tourist cabin or other place that regularly furnishes rooms or lodgings to transients for a consideration. Section 14-103 sets 7 percent of the charge for the room, including the charge for use or rental of personal property and services furnished in the room. Subsection (4) adds a separate 3 percent for designated recreation and economic development purposes, and subsection (3) adds $2.00 per rented room for each day of occupancy, beginning September 1, 2007. Charges that must be included in the state sales tax computation are left out of the base, and the tax follows the exemptions in chapter 26 of title 40 of the Code of Alabama, 1975.

Outside the city limits but inside the police jurisdiction, § 14-104 sets 3.5 percent, plus 1.5 percent for recreation and economic development and $1.00 per rented room for each day of occupancy.

Filing is monthly. Under § 14-105 the tax is due on or before the twentieth day of the month after it accrues, and each operator renders a city-prescribed form showing gross proceeds for the prior month. A operator who lets rooms on credit can defer reporting credit rentals until collected (§ 14-107). Timely payers take a 1 percent discount on the tax paid, but § 14-106 allows no discount on the per-room levies in §§ 14-103(3) and 14-104(3). Records of gross proceeds must be kept and stay open to the revenue department or a city representative during regular business hours (§ 14-108).