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Seward City Council <br /> April 25, 2011 . <br /> Page 2 <br /> AS 29.45.090(a) ". . . all property on which an ad valorem tax is levied shall be <br /> taxed at the same rate during the year." (This provision applies only to property taxes <br /> and not to sales taxes.) Keane v. Local Boundary Commission, 893 P.2d 1239 (Alaska <br /> 1995). <br /> The business inventory would be valued on January 1 unless the City by <br /> ordinance adopts the average monthly method. AS 29.45.110(b). <br /> Business owners would be required to file an annual property return with the <br /> Borough. The Kenai Peninsula Borough would collect and remit the tax to the City of <br /> Seward pursuant to AS 29.35.170. <br /> b. Sales Tax on Alcoholic Beverage Sales. <br /> Currently alcohol is taxed with other retail sales according to SCC 5.35. State <br /> law requires that there must be at least one other item taxed at the same rate. AS <br /> 04.21.010(c)(2) and Interior Cabaret, Hotel, Rest. and Retailers Ass'n v. Fairbanks <br /> North Star Borough, 135 P.3d 1000 (Alaska 2006). <br /> A tax on the wholesale sales of alcohol may be prohibited as double taxation <br /> because the City taxes alcohol sales at the retail level.' Furthermore, there may be no <br /> actual wholesale sales of alcohol in Seward that would trigger a taxable event or <br /> provide the nexus for a taxable sale to occur. Quill Corp. v. North Dakota, U.S. <br /> (1992). Bragg/Fannon v. Matanuska-Susitna Borough, 192 P.3d 982 (Alaska 2008). <br /> The Alaska supreme court distinguished an excise tax from a sales tax on the basis that <br /> a sales tax involves a transfer of ownership for consideration within the jurisdiction of <br /> the taxing entity. There may be no taxable event at the wholesale level occurring within <br /> Seward, at least with regard to alcohol. <br /> 2. Sales Tax on Alcohol and Tobacco Products. <br /> As stated above, the sales tax should be at the retail level, and if there is going to <br /> be a differential sales tax rate on alcohol there must be at least one other item taxed at <br /> that rate. AS 04.21 .010(c)(2) and Interior Cabaret, Hotel, Rest. and Retailers Ass'n v. <br /> Fairbanks North Star Borough, 135 P.3d 1000 (Alaska 2006). <br /> The Kenai Peninsula Borough would be expected to collect, disburse and <br /> enforce this tax. <br /> 1 "Sales tax" is not defined by Alaska Statutes. Black's Law Dictionary defines the tax as being on retail <br /> sales. The State Assessor believes a sales tax could be on wholesale sales, but not if there is a retail <br /> sales tax in place. <br />