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Rural Alaska

Bethel joins coalition of Alaska municipalities that aim to collect online sales tax

BETHEL - Another Alaska city has joined a coalition of municipalities that may soon begin collecting sales tax from the online purchases of residents.

The Bethel City Council unanimously voted to join the Alaska Remote Sales Tax Commission, KYUK-AM reported.

The statewide commission would serve as a directory for online retailers, acting Bethel City Manager Bill Howell said.

"The vendors will be able to go to one spot, and they'll know what all our exemptions are. They'll know what our sales tax rate is," Howell said.

A 2018 U.S. Supreme Court decision declared retailers are required to collect and remit sales tax for online purchases. Yet many still do not because of the burden of collecting a different sales tax rate and remitting it to each city.

An aerial view of Bethel on Friday, August 7, 2015.

The Alaska Remote Sales Tax Commission was established through the Alaska Municipal League. Bethel became the 23rd member of the body that also includes Adak, Haines, Homer, Juneau, the Kenai Peninsula Borough, Kodiak, Ketchikan, Palmer, Seward, Soldotna, Toksook Bay, Wasilla, and Wrangell.

Joining the commission is the first of three steps, Howell said. The second will be sending a Bethel representative to help write commission bylaws, while the third will be adopting a sales tax code agreed by the commission.

Bethel would pay administrative fees to the commission, but Howell said the city stands to gain hundreds of thousands of dollars in additional revenue from the online sales tax.

Bethel Mayor Perry Barr said some residents in the community on the Kuskokwim River believe they are "already overtaxed," although he noted the tax revenue will return to the community in other ways.

“Maybe hire more police officers, maybe cut down on our water/sewer rates,” Barr said. “I think it’s a great way for us to provide better services.”

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