The Mobile City Council is considering changes to how it collects business license fees for new businesses. Under the current system, in year one, a new business is asked to calculate its business license fee based on the first two months of receipts and then multiply that by six. That’s your license fee for year one. For the purposes of this story let’s call it “the two-month calculation.”
Council members are concerned this unfairly impacts businesses that start strong in their first two months but level off throughout the remainder of the year. Here’s the change. Businesses would still pay the first year business license fee. In year two the city would look at an annualized total of first-year receipts. If that annualized amount is less than the two month calculation businesses would get a break on the second year license based on the difference between the two. If the annualized amount is greater than the two month calculation then a business would have to pay the difference on top of the second year license fee as usual.
“It’s not driven by revenue it’s driven by fairness trying to make sure we kind of level the playing field for your business regardless of whether it starts off strong or starts off slow,” said City Councilman Joel Daves. The proposal seems likely to pass this morning.