Judge validates business license fees

Published 1:06 am Tuesday, February 16, 2010

A Montgomery County circuit court judge last week upheld the methods used by the City of Andalusia andthe City of Florala in assessing business license fees for pharmacies.

Charles Smith, owner of Pharm-A-Care in Andalusia and Florala Pharmacy in Florala, challenged those methods in court, arguing that the methods use in essence placed a sales tax on prescription drugs, which are not taxed in Alabama. Each city calculates business license fees based on total sales.

The suit also named Ala-Tax Inc., the company which collects sales taxes for local governments, and is now doing business as Revenue Discovery Systems.

In his order, Judge Eugene Reese stated that the tax ordinances were “plain and unambiguous and therefore … valid on their face.”

Tom Albritton represented the City of Andalusia in the suit, which was filed in 2008.