The State of Alaska does not levy a sales tax; there are, however, several municipal governments that do. Therefore, if you are a business entity subject to sales taxes within the state, you will need to contact the local municipal government for their particular sales tax regulations and forms. You can access this local contact information through the Division of Community and Regional Affairs Research and Analysis section.
The state constitution and other state laws give very broad authority to cities and boroughs in enacting a sales tax ordinance and determining what is taxable. There are very few non-taxable items (exemptions) required by state law. For information on what is not taxable, contact the municipality directly. There are some exemptions spelled out in state law; however, other than these, exemptions are a local issue.
A sales tax is not authorized unless an election is held on the issue and it is approved by a majority of the voters. At one time there was a limit on the maximum amount a municipality could charge for a sales tax, but that limit has been removed. State law also allows municipalities that levy a sales tax to levy a use tax, which is a tax levied on the storage, use, or consumption of goods in a municipality.
Frequently Asked Questions
Can I get the proper form from the state to file my sales tax with the local municipality?
No. In order to file your return, you must get the form from the municipality in which you conducted your business and owe the tax.
Do I have to pay a use tax on goods that I have already paid a sales tax on?
Not necessarily. State law requires that if you furnish proof to the municipality that you have paid a sales tax on the item, you will only have to pay for the difference in the amount of the sales tax paid and the use tax, if there is a difference.
Where can I get a listing of all municipalities that levy a sales tax?
There are two places to find that information. The Alaska Taxable is a yearly publication that lists all municipalities and the types of tax each levies. Alaska Taxable also lists the amount of taxes collected by each of these municipalities. The information in Alaska Taxable is "dated," meaning that it reflects the information up to a given date, usually July 1 of the prior year. You can get more current information from the Department of Community and Economic Development's website: "Alaska Community Database Online" - see "Custom Data Queries."
Can I be charged a sales tax by both the city and the borough?
It is possible. State law allows both cities and boroughs to levy a sales tax. In many boroughs that levy a sales tax, it is not unusual for a city within that borough to also levy a tax. Please refer to Alaska Taxable, Table 1 or Table 2, for a reference guide on local sales tax levies. (AS 29.45.650 and AS 29.45.700).
What is a use tax and how does it work?
A use tax is a tax that is levied on goods that are bought outside the taxing authority's jurisdiction and then brought into the jurisdiction. This tax is designed to discourage the purchase of products that are not subject to a sales tax. By state law, this tax may be levied on the storage, use, or consumption of goods in the borough/city. The use tax must equal the sales tax rate and is levied only on buyers (AS 29.45.650(b)).
State of Alaska Constitution:
Article IX, Section 1 - taxing power, prohibitions
Article IX, Section 2 - non-discrimination in tax rate
Article IX, Section 3 - assessment standards, prescribed by law
Article IX, Section 4 - exemptions, authority to prescribe additional exemptions by law
Article IX, Section 5 - government property, taxability of private use of otherwise exempt property
Article X, Section 1 - provision for maximum local self government and non-duplication of taxing jurisdictions
Article X, Section 2 - dedication of taxing powers to boroughs and cities only
AS 29.10.200 - Limitation on home rule powers, taxation, assessment, collections, exemptions
AS 29.25.010 - Acts required to be by ordinance, levy taxes, establish penalty
AS 29.35.010 - General powers and duties of municipality, authorization to levy tax and enforce tax law
AS 29.45.020 - Taxpayer notice, format, delivery
AS 29.45.030 - Taxable property and mandatory exemptions, application for exemption, ordinance establishing procedures and deadlines, waiver for late application, state reimbursement for exemptions, definitions
AS 29.45.040 - Property tax equivalency payments, application process
AS 29.45.046 - River habitat protection credit, eligibility, calculation method, exemptions
AS 29.45.050 - Optional exemptions, ordinance ratification, mandatory cap on exemptions, home-rule provisions
AS 29.45.055 - Levy of flat tax on personal property exempted from ad valorem tax
AS 29.45.060 - Farm or agricultural land
AS 29.45.062 - Land subject to a conversation easement
AS 29.45.065 - Assessment of private airports open for public use.
AS 29.45.070-.070 - Mobile homes, classification
AS 29.45.080 - Tax on oil and gas production and pipeline property, DOR valuation
AS 29.45.090 - Tax Limitation and mill rate equity
AS 29.45.100 - No limitation to pay for bonds
AS 29.45.103 - Taxation records, availability
AS 29.45.105 - Errors in taxation procedures, state assessor notice, appeal
AS 29.45.110 - Full and true value, assessment date, low income housing credit valuation and exemption
AS 29.45.120 - Returns
AS 29.45.130 - Independent investigations
AS 29.45.140 - Violations; authorization to prescribe penalties by ordinance
AS 29.45.150 - Reevaluation
AS 29.45.160 - Assessment roll
AS 29.35.170 - Assessment and collection of tax, borough collection of city tax
AS 29.45.180 - Corrections
AS 29.45.190 - Appeal
AS 29.45.200 - Board of Equalization
AS 29.45.210 - Hearing
AS 29.45.220 - Supplementary assessment rolls
AS 29.45.230 - Tax adjustments on property affected by a natural disaster
AS 29.45.240 - Establishment of levy and determination of rate
AS 29.45.250 - Rates of penalty and interest
AS 29.45.550 - Cities outside boroughs
AS 29.45.560 - Cities inside boroughs
AS 29.45.580 - Differential tax zones
AS 29.45.590 - Limited property taxing power for second class cities
AS 29.45.600 - Combining property tax with incorporation of a second class city
AS 29.45.650 - Borough sales and use taxes, exemptions by ordinance, interest on delinquent sales tax - limitations, liens, lien priority, mandatory exemptions
AS 29.45.670 - Notice of tax, publication period, revenue sharing requirement
AS 29.45.670 - Referendum, adoption and modification
AS 29.45.680 - Combining sales and use tax with incorporation of a borough, incorporation subject to passage of tax
AS 29.45.700 - City sales and use tax, power of levy, borough levy, borough ordinance authorizing levy of tax, mandatory exemptions,
AS 29.45.710 - Combining sales and use tax with incorporation of a second class city, incorporation subject to passage of tax
AS 29.45.800-.810 - Stranded gas development contract, exemption
AS 29.60.010 - State revenue sharing tax equalization formula
AS 29.60.080 - Definitions
AS 29.45.010 - Authority to levy a property tax, areawide, non-areawide, service area, home rule, first class second class
AS 29.60.010 - State revenue sharing tax equalization formula
AS 29.60.080 - Definitions
AS 43.56.010 - Levy of municipal tax on oil and gas exploration, production, and pipeline property, limitation on tax assessment rate
AS 43.56.020 - Exemptions on levy of municipal tax on oil and gas exploration, production, and pipeline property
AS 43.56.030 - Tax in lieu of
AS 43.56.040 - State assessment review board
AS 43.56.060 - Commerce assessment of oil and gas and pipeline property subject to taxation
AS 43.82.210 - Payment in lieu of taxes on stranded gas development projects
3 AAC 131.010-.020 - certification and notification of population for oil & gas property tax limitations, alternate population determination methods
3 AAC 131.030 - definitions
3 AAC 135.010-.085 - senior citizen and disabled veteran exemptions, method of application and forms, deadlines and calculations, eligibility of spouse
3 AAC 135.095 - effect of exemption on other legal encumbrances
3 AAC 135.110 - appeal
3 AAC 135.120 - definitions
3 AAC 136.010-.045 - senior citizen and disabled veteran property tax equivalency payment forms, rent verification, eligibility, eligible costs, age verification, veteran's disability verification, computation of payment
3 AAC 136.060 - definitions
3 AAC 138.010 - 020 farm and agricultural land assessment and deferment application dorms, income verification
3 AAC 138.030 - appeal
3 AAC 138.040-.050 - municipal maintenance of agricultural land records, confidentiality
3 AAC 138.060 - definitions
3 AAC 139.010 - state assessor review of written complaint, review of municipal records
3 AAC 139.020 - state assessor notification of error
3 AAC 139.030 - appeal of state assessor's determination
3 AAC 139.900 - definitions
15 AAC 56.005-.010 - oil and gas exploration production and pipeline property tax, filing property statement with state, notice of assessment, municipal notification
15 AAC 56.015-.045 - standing to appeal, appeal to state, appeal to assessment review board, assessment review board hearing, supplementary assessments
15 AAC 56.050-.065 - credit and refund of oil & gas property tax, payment due date,
15 AAC 56.070 - average per capita full and true value determination and notification
15 AAC 56.075-.110 - taxable oil & gas property, exploration, production, pipeline property
15 AAC 56.120 - intangible drilling expenses
15 AAC 56.130 - preservation of municipal powers