Alaska Internet Sales Tax
Learn about the Internet sales tax rules for Alaska.
Alaska, along with Delaware, New Hampshire, Montana, and Oregon, is one of five states with no state sales tax. Therefore, if you are selling goods or products over the Internet to customers located in Alaska, sales tax for your Alaska customers should be a non-issue under current law.
However, at the federal level, Congress has repeatedly considered legislation that would affect large Internet retailers and how online sales taxes are collected in all states. The most recent form of a proposed federal law is the Marketplace Fairness Act of 2015. As in previous versions, the 2015 Act would allow states to require sellers not physically located in their state to collect taxes on online and catalog sales made to people in their state. Sellers that make $1 million or less in annual sales and have no physical presence in the state would be exempt from this requirement. States would have to meet certain criteria to simplify their sales tax laws and make sales tax collection easier before they could require sellers to collect the tax.
Alaska Local Sales Taxes
Keep in mind that although there is no state sales tax in Alaska, Alaska’s Office of the State Assessor states that some Alaska municipalities have local sales taxes. However, unless you happen to be located in one of those municipalities, those local sales taxes should not be a concern.
The current default rule throughout the United States is that you must collect sales tax on Internet sales to customers in those states where your business has a physical presence. The physical presence rule is based on a 1992 United States Supreme Court decision, Quill Corp. v. North Dakota, that addressed the obligations of mail order businesses to collect sales tax on out-of-state sales. The decision has been extended to include online retailers. Generally speaking, physical presence means having:
- a warehouse in the state
- a store in the state
- an office in the state, or
- a sales representative in the state.
The corollary to the physical-presence rule is that if you do not have a physical presence in the state, you generally are not required to collect sales tax for an Internet-based sale to someone in that state.
Because Alaska has no state sales tax, these rules are not relevant to sales you make to Alaska customers.
Updated: April 14, 2016