At a meeting on April 21, 2015, the Birmingham City Council voted to reduce business license fees for certain professions, such as physicians, accountants, attorneys, engineers, and various others. The City Council Agenda, as well as a video recording of the meeting is available here. Birmingham’s business license fees are assessed annually on businesses, based on gross receipts from services rendered in the City. At the meeting, the City Council discussed the recent history of business license fees in Birmingham, actions by previous City Councils and fee increases during Mayor Larry Langford’s administration, as well as the reasons for the current reduction. According to Finance Director Tom Barnett, as quoted in an article by Joseph D. Bryant on Al.com, the city has collected about $243 Million from increased business license fees since 2008.
The reduction will be effective in 2016. According to Mr. Bryant’s article referenced above, the total tax break next year amounts to $6 Million. Also discussed at the City Council meeting were several ideas regarding further possible changes to business license fees, such as relief for businesses in Birmingham that have paid business license fees and that have stayed in Birmingham.
Attracting business to the City and job creation were the primary reasons offered by the City Council for the reduction. Relative to surrounding areas, this change reduces expenses for professionals practicing in Birmingham. If the City Council’s goals are realized and businesses move in to the city from surrounding areas, the impact ultimately could be felt in lease rates for commercial real estate.