Alaska State Sales Tax – A Quick Guide for Businesses

State Spotlight Series AK

Alaska State Skyline

Alaska State Sales Tax: None
Income Tax: None

Though a state sales tax doesn’t actually exist, there are still a variety of taxes found throughout the state. In fact, a pack of cigarettes could cost you almost ten dollars after the sin tax is applied in Anchorage. But the good news is that since there are no state taxes, there are no complicated nexus rules!

So where does Alaska get it’s income?

We can’t discount that Alaska is the third highest proven oil reserve in the country; it’s Alaska’s biggest income source. And while Anchorage’s cigarette sin tax brought in over 22,500,000 dollars, it certainly doesn’t pay for everything. The income is taken from a mixture of tourism, natural resources, and local sales tax.

City and Borough Sales Tax in Alaska

While places like Anchorage and Fairbanks have a sin tax on tobacco products, they don’t have sales tax. However, there are several cities like the capital, Juneau that do.

Alaska State Flag
  • Kodiak: 7.0%
  • Anderson 6.0%
  • Haines Borough: 5.5%
  • Juneau: 5.0%
  • Homer: 4.5%

Bed Tax

Many cities in Alaska levy a bed tax of up to 12%. Usually called a lodging tax, the bed tax is applied to hotels and lodging facilities, mostly used for tourism. Rather, it is a lodging and tourism tax. This tax brings in millions of dollars every year.

Weirdest Tax Law:

Arguably, the weirdest tax-related law Alaska has is the lack of both sales and personal income tax legislation. Including Alaska, there are five states without sales tax: Delaware, Montana, New Hampshire, and Oregon. Only seven states do not levy personal income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. With a public debt of 14.26 billion dollars, it’s easy to find the lack of taxes odd.

For more information visit the Alaska Department of Revenue

We’re making our way though all fifty states. Check out our State Spotlight category to see all that we’ve done so far.

Please note: this blog is for informational purposes and should not to be considered, or used in place of, professional advice for your specific situation.

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