Anchorage considers local sales tax

ANCHORAGE, Alaska (AP) – Anchorage officials could soon consider a proposal to bring a sales tax to the city.

Anchorage Assembly member Bill Evans is drafting the ordinance that calls for a 4 percent tax on goods and services. He said it will help diversify the municipality’s revenue stream and offset property taxes “dollar for dollar.”

“People have been pretty upset about the rising property taxes. There’s a limit to what I think you can bear in property taxes in a municipality this size,” Evans told Alaska Public Media on Tuesday (http://bit.ly/2fE8zx1). “So diversifying the revenue stream, I think, makes a lot of sense, and takes in some people that currently aren’t paying taxes in Anchorage, people that are commuting here, tourists, things like that.”

Under the draft ordinance, essential goods such as food, rent, prescription medicine and gas would be exempt from the tax.

“I think one of the hardest hit groups right now are people that are the more or less ‘working poor,’ who have a house but that increasing property tax that they can’t get out from almost threatens their ability to keep their house,” Evans said.

The sales tax makes sense for Anchorage, as property taxes in the city could begin to decline amid the state’s multibillion-dollar budget deficit, Evans said.

“It would be much more sensible to have at least a couple irons in the fire as far as how you determine your revenues,” he said.

Evans plans to bring the proposal before the assembly in December or January. If approved, the measure would go on the ballot in the April municipal elections, where it would need at least 60 percent of Anchorage voters’ support to pass.

The municipality has never had a sales tax. A 2006 measure to introduce one failed.