The issue of an online sales tax in Bethel has been postponed. The city council voted to table the proposed Uniform Remote Sellers Sales Tax Code until its April 14 regular meeting.
The decision came after former mayor Richard Robb spoke out against the tax.
“Alaska Statute 29.45.670: ‘A new sales or use tax or an increase in the rate of levy of a sales tax approved by ordinance does not take effect until ratified until the majority of the voters at an election,’” Robb recited. “So even if you passed this tonight, it would still require a vote of the people, according to Alaska Statutes.”
City Clerk Lori Strickler has said that this is not a new tax, but the enforcement of one that already exists. A 2018 U.S. Supreme Court decision requires online retailers to comply with such a tax, but many currently do not because of the administrative burden of collecting a different sales tax rate and remitting it to each city.
The Alaska Municipal League created an organization to serve as a middle-man between Alaskan municipalities and online sellers. If city council does vote to adopt AML’s tax code, Bethel residents would start paying the online sales tax after 30 days. They would pay the same tax rates that are charged in Bethel, with the same exceptions: 6 percent on purchases, with exceptions for Elders.
Mayor Perry Barr made the motion to postpone voting on the tax ordinance until consulting with the incoming city attorney. The other council members agreed. New city attorney Elizabeth “Libby” Bakalar starts work for the City of Bethel on March 16.