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Senior Sales Tax Exemptions Scaled Back in Juneau

  • Sep 23, 2015 | Gail Cole

 Juneau seniors are about to have their sales tax exemption limited.

The sales tax exemptions available to senior citizens in Juneau have been under fire for some time. After lengthy public discussion on Monday night, the Juneau Assembly approved Ordinance 2015-41, which scales back the exemption and stands to increase revenue by $1 million per year. The new tax policy will take effect January 1, 2016.

Although low-income seniors will still have all exemptions under the new senior sales tax exemption policy, other seniors will pay the local 5% sales tax on many previously exempt retail purchases, such as restaurant meals and jewelry. Essentials such as food, heating fuel, and city water and sewer will remain exempt, and the exemption will be extended to garbage removal and recycling services. Alaska has no state sales tax.

High cost of living

The senior sales tax exemption is one reason Alaska is thought to be a good place to grow old. But since this issue was first raised, seniors have been saying that they could not remain in Juneau without the sales tax exemption because their fixed incomes do not keep up with inflation. That concern was raised again during Monday’s meeting, when one woman said it was the exemption that allowed her to stay in Juneau after her retirement. She also pointed out that seniors give back to the community in numerous ways.

Online shopping

Retailers worried that seniors will shop for non-essential items from Internet sellers not required to collect sales tax. During the assembly meeting, Seaside Yarns owner Melissa Highfill pointed out that 10 percent of her sales come from seniors with exemption cards. She said, “I can’t afford to lose up to 10 percent of my business by people buying online.”

Too many seniors

Yet Juneau’s senior population has doubled since the inception of the exemption and the number of seniors is expected to rise. Assembly member Kate Troll said during the meeting, “As many people here have said, we know the state’s fiscal situation isn’t very rosy. And we need to make sure we keep the programs and services the seniors depend upon” (KTOO).

Additional information about the senior citizen exemption is available through the City/Borough of Juneau.

photo credit: senior citizens via photopin (license)

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.