Alaska communities consider online sales tax
Communities across the state may start taxing online shopping. It's a proposal up for consideration by the Alaska Municipal League at its annual conference in Anchorage this week.
Much of Alaska already has a local sales tax for goods sold in physical stores, but online retailers are a relatively new frontier -- one that the 165 Alaskan cities and boroughs, who make up the league, want to explore.
In June, the U.S. Supreme Court determined it is legal to apply local sales tax to internet retailers who sell in a location, but have no physical property or employees there. The case, South Dakota v. Wayfair, stemmed from a state tax in South Dakota. There's no state sales tax and governor-elect Mike Dunleavy says he doesn't plan to implement one, but AML Executive Director Nils Andreassen says he doesn't have to.
"The fact is that there are existing taxes for a hundred different municipalities across the state, and so it's not a new tax," Andreassen said Tuesday. "It's just implementing current taxes at the local level, and it doesn't require a statewide tax, at all."
Andreassen says municipalities that already have sales taxes may be able to boost revenue and level the playing field for local businesses, who have to charge sales tax of their customers.
The online sales tax proposal is still in draft form, and the league hasn't taken a formal position on the idea. It's slated for review by community leaders on Thursday.
Andreassen notes that there are still many logistics to sort through before AML take any decisive action. For example, communities would have to agree on which items would be subject to the tax, and whether to provide exemptions for certain need-based items.
"It does require a lot of coordination between all of those municipalities that have current taxes," Andreassen said.
If AML does move forward with the proposal, Andreassen says concrete policy decisions won't likely be made until next year.
Copyright 2018 KTVA. All rights reserved.