Alabama cities and counties depend more than ever on business or occupational license revenues to provide a reliable and sustainable revenue source for their communities.
Revenue commissioners and finance directors across the state are looking for ways to ensure they are maximizing license and tax revenue collections to meet their funding needs.
Business license fees are required by many cities and counties. In addition to licenses, many jurisdictions in the state also collect sales and use tax locally. Taken together, fees and taxes fund a significant portion of city and county operating budgets.
But how can cities and counties ensure they are collecting all the fees and taxes they are owed?
1. Help Businesses Calculate the Right Fees
The first step to ensuring that you are collecting all revenues is to make it easier for businesses to navigate complex fee and payment schedules. The best way to do this is to remove the guesswork and offer businesses an online solution that helps them calculate the accurate fee based on business type and gross receipts.
2. Offer an Online Portal That Acts as a One-Stop-Shop for Businesses
Manual and paper-based processes take business owners away from what they should be doing to maximize their revenues. By offering an online portal that helps business owners submit all renewals, documentation, and payments easily and on time, cities and counties can save business owners money. Providing new tools and capabilities, like bulk filings for tax preparers, can also save time.
3. Establish a Direct Connection With Your Tax System of Record
It costs agencies time when staff have to hand-key renewal and payment information into their tax system of record (often Excel). Adopt a solution that collects all licensing, registration, and tax payment data in a centralized system that can be integrated with financial systems or used to power reporting and compliance.
4. Empower Staff With Audit Tools
To improve collections, cities and counties must focus staff time on audit and compliance activities. To do this, they need to automate the easy steps and give staff the tools to find inconsistencies in filings. Provide staff with proper auditing tools that help them identify and collect more revenue.
Adopting a solution that provides auditing and reporting functionality—and connects to the city’s accounting system—while providing a business owner portal with fee calculations ensures maximum revenues for the city or county.
Key Results From Adopting a Business License Solution
Cities and counties using a business license filing portal report:
- 20% increase in on-time payments
- 95% payment accuracy—improving revenues and predictability
- 20 hours per week in staff time savings with tools that help automate accounting and compliance
Alabama cities and counties adopting business license and tax software solutions should look for cloud-based, built-for-purpose tax management software that reduces manual accounting and reporting to ensure they are maximizing revenues for their communities.
