Alaska Sales Tax 2023 - 2024
Alaska does not impose a state sales tax, but local municipalities may. Following the Supreme Court ruling in Wayfair, many of these municipalities adopted the Remote Sellers Sales Tax Code.
Contents
Alaska Sales Tax is 0%, but individual municipalities have wide authority to implement their own rates up to 7%. Consequently, the local-level sales tax landscape can be very complex. The number of sales facilitated on its platform for each buyer determines a marketplace facilitator’s nexus in Alaska. This means that most businesses will be required to remit sales tax to the Alaska Remote Sellers Sales Tax Commission. In most cases, the remittance schedule will be quarterly. However, the Commission is currently considering a move to monthly reporting for all remote sellers. If the move goes through, the remittance schedule would change accordingly. For now, however, the remittance schedule remains as is.
Alaska Remote Seller Sales Tax Commission
Alaska is a destination-based sales tax state, meaning that the Alaska sales taxes collected are based on the buyer’s address. This is unlike some states where the tax is charged on the seller’s location. Because of this, the varying sales tax rates across local jurisdictions can be difficult to keep track of.
In order to simplify the process, the Alaska Remote Seller Sales Tax Commission (ARSSTC) was established as a single-level sales tax administrator. ARSSTC will collect, remit and administer sales tax for local jurisdictions that participate in the Streamlined Sales Tax Project.
The ARSSTC has a list of participating local sales tax jurisdictions on their website. You can use this list to determine which local sales taxes you are required to collect and remit.
Alaska Sales Tax Exemption
If you’re a business that sells in Alaska, there are several sales tax exemptions to be aware of. Alaska’s tangible products (e.g., food, drink and certain clothing) are taxable. Digital products, also known as Software as a Service (SaaS) are typically taxable, but rules can be unclear – check with the Alaska Department of Revenue to make sure your product falls within their definition of SaaS.
Services are taxable in Alaska, including professional services provided by lawyers, architects, landscapers, etc. Dues or fees paid to belong to a nonprofit club, labor union, or fraternal organization that has obtained an IRC 501(c) tax exemption certificate are exempt from sales tax. Freight and wharfage charges, unless included in a through bill of lading in conjunction with interstate commerce, are also exempt.
In response to the South Dakota v. Wayfair decision, local governments in Alaska established an intergovernmental remote seller sales tax commission and passed the Alaska Remote Sellers Sales Tax Code & Common Definitions. The code requires remote sellers and marketplace facilitators that exceed a threshold amount to register, collect, remit, and file sales taxes in member jurisdictions.
Alaska Sales Tax Due Date
If you sell to Alaska, the first due date to mark on your calendar is Wednesday, December 20. However, the rest of the year’s dates vary from month to month and depend on whether you file quarterly, monthly, or annually. Check each state’s website for specific criteria on how often you need to file.
