Will discuss at Tuesday evening’s work session
City attorneys’ memo says yes, city can collect taxes online
Could be hard to actually do unless all Alaska towns get uniform tax
Kodiak City Council will discussion on collecting sales taxes online based on a legal review which is part of Tuesday’s work session agenda.
A recent social media post got a lot of attention when a person said they got charged city sales tax for an online purchase.
The council will review a memo from the city’s attorneys addressing the legalities of charging a local sales tax for online sales.
The details according to the attorneys:
1) Yes the city has a legal right to collect sales taxes for online purchases,
2) The city needs to change its definition of when a sale is made within the city so that it includes online purchases, and
3) Even if the city changes the ordinance to collect online taxes, it is possible that sellers will resist complying until the cities in Alaska can agree on a uniform tax, which could include a standardized state-wide sales tax.
Currently each taxing community has different rules and exemptions, and following them creates a burden on the companies trying to collect the taxes.
Tonight’s work session begins at 7:30 in the Library multi-purpose room.