Alabama SB346 Would Levy 8% Tax on Historical Horse Racing Receipts

Senators Figures, Sessions and Albritton introduced Senate Bill 346, filed as KHFGR5A-1 and carrying the header CMH (L)bm 2026-1220, which would levy an eight percent local privilege tax in Mobile County on net gambling revenue from historical horse racing computerized machines. The bill was first read in the legislature on March 5, 2026 and assigns collection responsibility to the Mobile County Racing Commission.

The bill spells out the taxable base in statutory language: "There is levied in Mobile County a privilege tax of eight percent of the net gambling revenue collected from pari-mutuel wagering on historical horse racing on computerized machines of a historical horse racing licensee of the Mobile County Racing Commission." The text further directs that "The tax shall be collected by the Mobile County Racing Commission from each historical horse racing licensee and distributed as provided by local law."

SB346 contains a supremacy clause aimed at consolidating local levies on historical horse racing pari-mutuel activity in Mobile County. The bill states the new levy "is exclusive of and supersedes any other local taxes, fees, or commissions now imposed on historical horse racing pari-mutuel activities in the county, including, but not limited to, the tax imposed pursuant to Section 45-49-151.14, Code of Alabama 1975." The sponsors explicitly single out Section 45-49-151.14 as an example of a tax the 8% privilege tax would replace for HHR receipts.

At the same time, the bill carves out non-HHR racing: "Nothing in this section shall change the existing tax structure contained in section 45-49-151.14, Code of Alabama 1975, for live greyhound racing, as well as simulcast live greyhound and thoroughbred racing in Mobile County, which is not historical horse racing." That language preserves the existing statutory treatment for live greyhound meets and simulcast thoroughbred or greyhound wagering under 45-49-151.14.

The proposal arrives against a backdrop of Alabama municipal tax law in which occupational or privilege taxes have a long judicial history. Section 11-51-90, Code of Alabama 1975, "has been interpreted by the courts as giving municipalities authority to levy a tax for the privilege of working in the municipality," and Almonline notes that such an occupational tax "operates in a manner similar to an income tax" and is in effect in "at least 20 cities and towns." Alabama decisions cited in background material include Estes v. Gadsden, McPheeter v. Auburn and a limitation in Mountain Brook v. Beaty on taxing those who work only in a police jurisdiction.

Several concrete data points remain absent from the SB346 excerpt provided: the bill fragment contains no fiscal note or estimate of annual revenue yield, it does not identify the historical horse racing licensees that would pay the tax, and it leaves "distributed as provided by local law" undefined. The excerpt also omits an effective date and any enforcement or audit provisions. The measure was formally introduced and first read on March 5, 2026; its next steps will include committee referral and potential fiscal analysis that will determine how the Mobile County Racing Commission would implement collection and how municipalities and licensees will be affected.