Decatur, AL Local Taxes & Fees: Business Tax Classification (2026)

Chapter 14 of the Code of Decatur, Alabama, classifies businesses in two steps. Section 14-35 says every business required to buy a license under the chapter is classified into one or more of the 2002 North American Industrial Classification System sectors. The dollar amount then comes from the license schedule in § 14-38, which prices each trade by flat fee, by tiers of gross annual receipts, or by pointing to another rate table with phrases such as "Service rates apply" or "Merchant, retail rates apply." A contractor pays $75 below $20,000 in gross annual receipts, rising by tier to $500 at $500,000 and over. A new automobile dealer pays $250 below $200,000 and $500 at or above it, plus one-twentieth of one percent of receipts above $200,000.

When a business fits more than one classification, § 14-32 picks the one with the highest license tax. If the revenue department finds that a lower-priced license was issued in error, it is authorized to recall and cancel it and require the higher one, without penalty unless the department, supported by a city council resolution, finds the licensee tried to misinform or misrepresent the business. Section 14-37 treats each leased department in a department store as its own license, although the store licensee can elect to combine all leased-department receipts with the store's own receipts.

Section 14-33 requires a sworn statement of total business done, gross receipts, stock or space occupied so the classification and amount can be set. The city enters a preliminary assessment where the numbers do not add up, the taxpayer has 30 days to file a petition for review with the municipal license officer, and the officer completes the review within 90 days whenever practicable. A final assessment can be appealed to circuit court within 30 days. Licenses are due January 1 and become delinquent on or after February 1 (§ 14-31), are not transferable (§ 14-30), and a business in the police jurisdiction outside the city limits pays one-half of the scheduled amount (§ 14-2). Anyone owing $200 or more in combined chapter 14 taxes must pay through the state paperless filing system (§ 14-4).