§ 5.18.450. Tax jurisdiction—Office location of seller.

A.

The rate of tax to be added to the sale price is based on the place of sale. The place of sale of goods and merchandise is the location of the retail outlet at which or from which delivery was made. This provision applies to goods delivered to buyers within the borough and to goods delivered to buyers outside the borough but within the state of Alaska. If the invoice includes a charge for installation, then the place of the sale for the goods and service is the retail outlet at which or from which delivery was made. When goods are delivered into the borough from a point outside of the borough and the seller maintains an ongoing physical presence in the borough, then the location of the seller's in-borough presence will determine the place of sale. If a seller has no ongoing physical presence in the borough but has established nexus with the borough, the point of delivery will determine the place of sale. If the seller has no ongoing physical presence in, or nexus with, the borough the sale is not subject to the borough sales tax. For purposes of this section the following terms are defined as shown below:

1.

"Nexus" means the seller has established a taxable connection within the borough by use of marketing techniques, such as directed advertising in the borough via telephone or internet, or door-to-door sales within the borough, or by use of contract workers or contract or commission agents or businesses, which are associated with the seller's efforts to establish or maintain a market for its goods or services, deliver those goods or services, or provide warranty or other repair or return services in the borough.

2.

The "point of delivery" where there is no ongoing physical presence in the borough is the place where physical possession of the goods is transferred to the customer.

B.

Sellers located outside the borough but which fulfill orders for buyers inside the borough that were solicited or facilitated by commission or fee agents, independent contractors or other persons located in the borough associated or affiliated with the seller shall be responsible for collecting and remitting sales tax on those orders, unless the tax is collected and remitted by the agent or contractor.

C.

The place of sale of services is where the services are delivered, which means the place where the services are rendered. The place of sale for freight, delivery, and courier services is the pickup location. The place of sale for services involving the transportation of passengers is the location where the passengers are picked up. The place of sale for vehicle towing services is the place where the vehicle is delivered. The place of sale for rentals is the place where the real property is located, or where the personal property is delivered to the renter. The borough shall determine the place of sale of a good, service, or rental pursuant to this section, and the borough's determination is final.

D.

When there is a question or dispute over the place where services are rendered, a seller of a service may, after requesting and receiving borough approval in writing, collect the tax based on the office location of the business selling such services. Approval of a request to collect a tax at the seller's office location is completely within the discretion of the borough, and shall not be granted if the borough has already determined that the place of sale for the seller's industry is not the office location.

E.

The seller is liable for any sales taxes due because of the seller's incorrect determination of the sales tax rate to be applied.

(Ord. No. 2016-31 , § 10, 9-6-16; Ord. No. 2002-39, § 13, 12-10-02; Ord. No. 94-27, § 13, 1994)