NOTICE OF PROPOSED CHANGES TO EXCISE TAX ON TRAVEL ABOARD COMMERCIAL PASSENGER VESSELS IN THE REGULATIONS OF THE DEPARTMENT OF REVENUE
BRIEF DESCRIPTION
Added 10.22.2020:
Department of Revenue’s Clarification Statement Regarding the Department’s Notice of Proposed Changes to Excise Taxes on Travel Aboard Commercial Passenger Vessels dated September 24, 2020 for Proposed Changes to Department Regulations under 15 AAC 52, Transportation Taxes, and Extension to Public Comment Period.
The Department of Revenue has received several comments and questions regarding its Notice of Proposed Changes to Excise Taxes on Travel Aboard Commercial Passenger Vessels dated September 24, 2020 for Proposed Changes to Department Regulations under 15 AAC 52, Transportation Taxes. In light of the public’s interest in this matter, the Department offers the below clarification statement and will also respond to each question separately.
The State of Alaska levies an excise tax of $34.50 on each passenger traveling on a commercial passenger vessel that meets certain qualifications. AS 43.52.200 – 43.52.295. The amount of state tax imposed on a passenger ($34.50), however, is reduced by the total amount of a tax or fee on a passenger traveling on a commercial passenger vessel that is imposed and collected by a home rule or general law municipality under a law enacted before December 17, 2007, as provided in AS 43.52.255. The City and Borough of Juneau and the City of Ketchikan are the only home rule or general law municipalities that had tax or fee laws enacted before December 17, 2007. Recently, the City of Ketchikan voted to increase its local levy for commercial passenger vessels mooring at a city or privately owned facility and for the lightering of passengers to those facilities, effective April 1, 2021. In light of this local levy increase, the Department determined that it was necessary to clarify through its proposed regulation that the state tax imposed under AS 43.52.200 – 43.52.295 may be reduced only by the total amount of a tax or fee on a passenger traveling on a commercial passenger vessel that is imposed and collected by a home rule or general law municipality under the tax or fee rates enacted before December 17, 2007. Thus, the passenger subject to the state tax imposed under AS 43.52.200 – 43.52.295 is liable for paying (1) the state tax of $34.50 less the total amount of applicable local levies calculated using the pre-December 17, 2007 rates; and (2) the applicable local levies calculated using the current applicable local rates. What local levies apply to each passenger is based on whether the passenger visits the City and Borough of Juneau, the City of Ketchikan, both, or neither. The proposed regulation will not change how the tax imposed under AS 43.52.200 – 43.52.295 is collected and distributed to port communities and it will not reduce the amount of tax or fees port communities can collect.
The public comment period has been extended. You may comment on the proposed regulation changes, including the costs to private persons of complying with the proposed changes, by submitting written comments to: Susan Jakonis, Income & Excise Tax Specialist, Alaska Department of Revenue, 550 W. 7th Ave., Ste. 500, Anchorage, AK 99501. Additionally, the Department of Revenue will accept comments by electronic mail to susan.jakonis@alaska.gov, or by facsimile at (907) 269-6644. Comments must be received no later than 4:00 p.m. on Thursday, November 12, 2020.
Original Notice:
The Department of Revenue proposes to change regulations on commercial passenger vessels taxes. The Alaska Department of Revenue ( department) proposes to add regulations in Chapter 52 of Title 15 of the Alaska Administrative Code: 15 AAC 52, Transportation Taxes. The proposed regulations add language for the tax rates used in the tax reduction for local levies in effect as of December 17, 2007. Other minor changes or additions proposed by the public may also be considered by the department.
The Department of Revenue proposes to add regulations under 15 AAC 52, Transportation Taxes of the Alaska Administrative Code as follows:
The following is necessary:
15 AAC 52.255, Tax reduction for local levies, establishes tax rates and law in effect on December 17, 2007.
You may comment on the proposed regulation changes, including the costs to private persons of complying with the proposed changes, by submitting written comments to: Susan Jakonis, Income & Excise Tax Specialist, Alaska Department of Revenue, 550 W. 7th Ave., Ste. 500, Anchorage, AK 99501. Additionally, the Department of Revenue will accept comments by electronic mail to susan.jakonis@alaska.gov, or by facsimile at (907) 269-6644. Comments must be received no later than 4:00 p.m., on Monday, October 26, 2020.
You may submit written questions relevant to the proposed action to Susan Jakonis. The questions must be received at least 10 days before the end of the public comment period. The department will aggregate its response to substantially similar questions and make the questions and responses available on the Alaska Online Public Notice System and Tax Division website at (http://www.tax.alaska.gov).
A copy of the proposed regulation changes is available on the Alaska Online Public Notice System, the Tax Division website, and by contacting Susan Jakonis.
After the public comment period ends on Monday, October 26, 2020, the department will either adopt the proposed regulation changes or other provisions dealing with the same subject, without further notice, or decide to take no action. The language of the final regulation may be different from that of the proposed regulation. You should comment during the time allowed if your interests could be affected. Written comments received are public records and are subject to public inspection.
Statutory Authority: AS 43.05.080.
Statutes Being Implemented, Interpreted, or Made Specific: AS 43.52.255.
Fiscal Information: The proposed regulation changes are not expected to require an increased appropriation.
The department keeps a list of individuals and organizations interested in its regulations. Those on the list will automatically be sent a copy of all of the department's notices of proposed regulation changes. If you would like to be added or removed from the department's "Interested Parties" list server to receive email notification of any proposed action you may do so at
http://list.state.ak.us. Simply scroll down to the links beginning with "tax-".
The department reserves the right to waive technical defects in this publication. Individuals with disabilities who may need auxiliary aides, services, or special modifications to participate in this process must contact the above address, email, or the TDD number (907) 269-8411 by 4:00 pm, Monday, October 19, 2020.