Sales Tax Simplification in Alaska

While Alaska does not have a state-level sales tax, many local governments impose a sales tax on taxable sales.  This impacts companies doing business in Alaska and remote sellers whose statewide sales meet the requirements to collect and remit sales tax.  In an effort to simplify the complexity associated with knowing when and where to collect sales tax, Alaska formed the Alaska Remote Seller Sales Tax Commission. 

The Alaska Remote Seller Sales Tax Commission

Local governments in Alaska signed an intergovernmental agreement to establish the Alaska Remote Seller Sales Tax Commission.  The Commission will provide streamlined, single-level administration of sales tax collection and remittance, with an active board of directors and members contributing to solutions that work for everyone.  The Commission is comprised of local government members with a current sales tax in place.  

The Alaska Remote Seller Sales Tax Commission recently passed a Uniform Code, as it applies to Remote Sellers and Marketplace facilitators.  This Uniform Code reduces the burden on companies and remote sellers by providing:

1. Single-level, statewide administration.
2. Software approved by local taxing authorities providing tax rates and taxability rules (what is taxable and exempt).
3. A Geographic Information System (GIS) allowing pin-point accuracy of tax rates for an exact location within Alaska.
4. Software that provides a single access point for registration, filing tax returns, and remitting tax.

Registration, Tax Returns, and Remittance

In coordination with MUNIRevs, companies can easily register, file tax returns, and remit tax using this website:  https://arsstc.munirevs.com/
If a remote seller or marketplace facilitator meets the criteria threshold set out in the Commission's Uniform Code then registration is encouraged immediately. Collection should begin according to the effective date of member municipalities. Please follow the collection and return policy adopted by the Commission.

Established in 2011, MUNIRevs works with states and communities to automate their business revenue collection.  With more than a billion dollars in paperless revenue collected, MUNIRevs has become the trusted source for payment processing, allowing residents the ease and convenience of on-time payment while helping cities and states eliminate approximately 95 percent of the manual data entry tasks.  To learn more, visit  www.munirevs.com.

GIS Sales Tax Rates, Taxability Rules, and API Connectors

Using TTR's GIS Sales Tax System, companies can easily look up tax rates and determine whether sales are taxable or exempt.  TTR's system may be accessed using the following website:  https://alaska.ttr.services/
TTR's GIS Sales Tax Lookup System provides up-to-date tax rates and accurate taxability rules (whether something is taxable or exempt) for anywhere in Alaska, with an Application Programming Interface (API) to automate looking up this information. 

TTR, The Tax Research Company, provides everything sales, use, and transaction tax related.  Access to tax laws, a best in class research system, the most accurate tax rates and taxability rules available anywhere; with 10,000 companies and counting, TTR has become a "best practice" in the area of sales, use, and transaction tax.  TTR also provides software solutions for companies and governments.  TTR's revolutionary Artificial Intelligence Enabled Exemption Certificate Management System (ECMS), Tax Automation software, and proprietary nationwide GIS Tax Rate System allow businesses and states to Get Tax Right.  To learn more, visit www.ttrus.com.

Does My Company Need to Register to Collect Sales Tax in Alaska?

Remote sellers or marketplace facilitators must collect and remit sales tax they have met one of the following Threshold Criteria ("Threshold Criteria") in the previous calendar year:

1. The remote seller's statewide gross sales, including the seller's marketplace facilitator's statewide gross sales, from the sale(s) of property, products or services delivered into the state meets or exceeds one hundred thousand dollars ($100,000); or 
2. The remote seller, including the seller's marketplace facilitator, sold property, products, or services delivered into the state in two hundred (200) or more separate transactions.

For purposes of determining whether the Threshold Criteria are met, remote sellers or marketplace facilitators shall include all gross sales, from all sales of goods, property, products, or services rendered within the state of Alaska.

(Section .040 – Obligation to Collect Tax – Threshold Criteria)

What's Next?

In the months to come, we expect dozens of additional local governments to adopt the Uniform Code.  Sellers will be notified on a rolling basis of their effective dates, and returns will become allowable as they adopt. The Commission expects that by the end of this fiscal year – June 30 – jurisdictions responsible for the majority of sales tax collected in Alaska will have adopted the Code and expect compliance.

If you have any questions about how to register or submit returns and remittance, look up rates and exemptions, or need guidance at all, then please don't hesitate to contact us at  amstp@akml.org or by phone at (907) 790-5304.

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SOURCE MUNIRevs