Revenue & Taxes

The Revenue Division applies all laws and regulations dealing with the collection of various taxes and fees due to the city. The Finance Department will provide complete, accurate, and timely information and services to businesses and taxpayers.

The City of Pelham administers and self-collects the following taxes: sales, seller's use, consumer's use, rental, lodging, wine, liquor, and gasoline. State rules are followed on definitions, exceptions, exemptions, and deductions. Returns are due by the 20th of each month for the preceding month.

  1. Sales Tax Information
  2. Sales Tax Exemptions
  3. Other Tax Information
  4. Revenue & Tax Forms

Sales Tax

  • Sales tax is due on the sale of tangible personal property and is due from the consumer (customer). If a business is engaged in selling tangible personal property, it should add the tax to the sales invoice and collect the sales tax from the customer at the time of purchase.
  • Sales tax is also due on the gross receipts from places of amusement or entertainment.
  • The general sales tax rate in the City of Pelham is 10% 
    • State of Alabama - 4%
    • Shelby County - 1%
    • Pelham City Schools - 1%
    • City of Pelham - 4%
  • The food and grocery sales tax rate (Act 2023-554) in the City of Pelham is 8%
    • State of Alabama - 3%
    • Shelby County - 1%
    • Pelham City Schools - 1%
    • City of Pelham 3%

If applicable, businesses may check with each agency to obtain their automotive, farm equipment, and manufacturing rates. In the City of Pelham, all sales are taxed at the City's general rate, with the exception of automotive vehicles. The automotive tax rate is 1%.