Business Licenses Q&A: Authorities Thinking Locally

Audience Question: Many authorities think locally. They do not think about a company that is distributing nationally and therefore requires a municipal business license when a single product is sold in their municipality. Alabama is a prime example. I have more Alabama municipal business licenses than any other license. Are there other states trending toward such excessive licensing?

Joe's Response:I say a resounding “Yes!” California, Georgia, and Arizona are overt examples of states that are requiring separate licenses for all salespersons and business activities in each municipality. California, in particular, may be a bellweather for this trend.

Amanda's Response: We think that local jurisdictions are now better able to grab national distribution of products into their local net which is what we consider better enforcement. While the rules aren’t necessarily new, they are really getting better at forcing companies — especially national retailers — to pay their local business license fees because of revenue generation within their locality. On the other hand, there are still many localities that have a business license requirement but do exempt retailers shipping their product to consumers via common carrier and we haven’t seen those localities shift away from this.

(Author's Note: Business Licenses, LLC was pleased to host a webinar on April 30th, 2014 to discuss emerging trends in business license compliance. During the Q&A, the audience submitted many thought-provoking questions that our panelists didn’t have time to answer. We are going to periodically post those questions to this blog along with answers from the two panelists, Amanda Mattaliano and Joe Vitulli.)

By Alan Ruttenberg