Chapter 17.10
SALES TAX

Sections:

17.10.010    Sales tax.

17.10.015    Sales tax returns.

17.10.018    Extension of time to file tax return.

17.10.020    Exceptions.

17.10.030    Exemptions.

17.10.040    Tax based on selling price.

17.10.050    Application for exemption.

17.10.060    Sales tax licensing.

17.10.071    Amended returns.

17.10.080    Remittance of tax.

17.10.082    Repayment plans.

17.10.085    Use of information on sales tax returns.

17.10.090    Termination, sale or transfer of retail business.

17.10.100    Penalties and interest.

17.10.105    Application of sales tax payments.

17.10.110    Estimated tax.

17.10.120    Tax evasion.

17.10.130    Tax audits.

17.10.150    Tax liens interest.

17.10.160    Enforcement remedies.

17.10.170    Situs of taxable transaction.

17.10.175    Resale certificate.

17.10.180    Definitions.

17.10.200    Regulations.

17.10.010 Sales tax.

(a) There shall be levied and collected a sales tax of five percent of the selling price on all retail sales and rentals of goods and services in the city, except as provided in NCO Section 17.10.020, during the months of September, October, November, December, January, February, March and April.

(b) During the months of May, June, July, and August there shall be levied and collected a sales tax of seven percent of the selling price on all retail sales and rentals of goods and services in the city, except as provided in NCO Section 17.10.020. (Ord. O-16-10-09 § 1, 2016: Ord. O-03-07-2 § 1, 2003: Ord. O-93-6-6 § 1 (part), 1994)

17.10.015 Sales tax returns.1

(a) For each separate business entity which has made transactions subject to tax the preceding month, a seller shall complete a Nome sales tax return reporting, in a manner established by the form, all retail sales during the preceding calendar month; provided, however, that a business entity that is current with filing of all sales tax returns and payment of sales tax and whose average monthly sales are less than five thousand dollars may, upon written authorization from the assessor, submit quarterly returns. Authorization to submit quarterly returns may be withdrawn upon subsequent failure to timely file sales tax returns or remit sales tax. Each sales tax return shall set forth the gross receipts of the retail business for the reporting period, including all taxable and nontaxable transactions; the dollar amount and exemption certificate identification number for each exempted transaction and such other information as the city clerk may require. Each sales tax return shall be signed and sworn or affirmed under oath by the seller, and shall be received at the office of the city clerk or postmarked with sufficient postage on or before the twentieth day of the month succeeding the end of that reporting period. In the event that the due date is a Saturday, Sunday or legal holiday, the sales tax return shall be received or postmarked with sufficient postage on or before the next following business day. All taxes, penalties and interest due shall be remitted with the sales tax form.

(b) As part of the reporting requirement of this section a permittee, vendor or operator conducting a charitable gaming business and acting as a seller in the city shall file with the city copies of all reports reflecting sales in the city which are required to be filed by a permittee, vendor or operator with the state pursuant to AS 05.15.080 and AS 05.15.083. The permittee, vendor or operator shall file these reports with the city with the first succeeding sales tax return due to the city after the time required for the permittee, vendor or operator to file the report under AS 05.15.080 and AS 05.15.083. In the event a permittee, vendor or operator has obtained from the state an extension of time to file a report from the state, the time for the permittee, vendor or operator to file the report required by this section shall likewise be extended provided that the permittee, vendor or operator files with the city written authorization of any extension from the state before the next succeeding sales tax report is due. In the event a permittee utilizes a vendor to sell pull-tabs on its behalf, the vendor acting as a seller in the city shall, as part of the reporting requirement of this section, file with the city copies of all reports provided by the vendor to the permittees to enable the permittees to file their quarterly and annual reports under AS 05.15.080.

(c) For purposes of this section, the terms “operator,” “permittee” and “vendor” have the meanings given to those terms in AS 05.15.690. (Ord. O-12-09-02 §§ 1, 6, 2012; Ord. O-01-11-3 § 2, 2001: Ord. O-93-6-6 § 1 (part), 1994. Formerly 17.10.070)

17.10.018 Extension of time to file tax return.

Upon written application of a seller other than a remote seller or marketplace facilitator, stating the reasons therefor, the city clerk may extend the time to file a sales tax return but only if the city clerk finds each of the following:

(a) For reasons beyond the seller’s control, the seller has been unable to maintain in a current condition the books and records that contain the information required to complete the return;

(b) Such extension is a dire necessity for bookkeeping reasons and would avert undue hardship upon the seller;

(c) The seller has a plan to cure the problem that caused the seller to apply for an extension and the seller agrees to proceed with diligence to cure the problem;

(d) At the time of the application, the seller is not delinquent in filing any other sales tax return, in remitting sales tax or otherwise in violation of this chapter;

(e) No such extension shall be made retroactively to cover existing delinquencies. (Ord. O-20-02-01 § 6, 2020)

17.10.020 Exceptions.

No sales tax shall be levied or collected on the following retail sales, rentals of goods, and services:

(a) Medical, dental, optometric and hospital services;

(b) Prescription medicines, oxygen used for medical purposes, blood and blood plasma, artificial limbs, eyes, organs, hearing aids, prescription eyeglasses, teeth, crutches, wheelchairs and walking aids sold or rented by a registered or certified doctor, nurse, dentist, optician, audiologist, pharmacist or hospital institution;

(c) Services and construction materials for actual use and either consumption or absorption in a construction project for which:

(1) A building permit has been issued; or

(2) A construction contract has been awarded by the state or a state agency, or a subcontract has been awarded in connection with the project funded under the construction contract;

(d) That portion in excess of one thousand five hundred dollars of the selling price of each retail sales transaction of a snowmachine or an all-terrain vehicle (ATV);

(e) Rentals, leases or transfers of an interest in real property for a period in excess of twenty-seven days;

(f) Gross receipts or proceeds from carrier sales made directly to consumers or users of newspapers or any other periodicals;

(g) Purchases made with food coupons, food stamps or other type of certificate issued under 7 U.S.C. 2011-2025 (Food Stamp Act);

(h) Purchases made with food instruments, food vouchers, or other type of certificate issued under 42 U.S.C. 1786 (Special Supplemental Food Program for Women, Infants and Children);

(i) Incidental and de minimus use of residential housing for income-producing purposes;

(j) That portion in excess of one thousand five hundred dollars of the selling price of each retail sales transaction of an automobile, minivan, suburban, van or pickup truck;

(k) The following fees charged by banks, savings and loan associations, credit unions and investment banks:

(1) Maintenance of banking accounts and credit card accounts,

(2) Interest for loans and on credit card accounts,

(3) Loan origination services,

(4) Points on assessed loans,

(5) Set up services for any financial service such as escrow accounts,

(6) Closing costs on loans but only such costs that are not exact reimbursement of third party services such as credit checks, title insurance or appraisal fees,

(7) Overdraft and NSF fees,

(8) Stop payment fees,

(9) Wire transfer fees,

(10) Debit card fees,

(11) Telephone banking charges,

(12) Foreign currency exchange services,

(13) Notary services,

(14) Signature guarantee services,

(15) Fees for the purchase of checks, cashier checks, money orders, travelers checks;

(l) Dues or fees to clubs, labor unions or fraternal organizations;

(m) Child care, pre-elementary school and baby-sitting services;

(n) Goods or services, other than charitable gaming, sold by student organizations to raise funds for extracurricular activities or events;

(o) Retail sales of food are exempt in the following:

(1) When served in cafeterias or lunchrooms of elementary, secondary, post-secondary schools, colleges or universities which are operated primarily for students and staff, and are not operated for the public or for profit,

(2) Meals delivered by a nonprofit organization to handicapped or senior citizens at their place of residence; or meals served on the premises of a nonprofit senior citizen organization which receives funding from the state of Alaska or a political subdivision of the state; provided the sale price of such meals does not exceed the cost of delivery or service of such meals;

(p) Wharfage charges, whether arising out of foreign, interstate or intrastate commerce. (Ord. O-12-09-02 § 2, 2012; Ord. O-07-04-01 § 1, 2007; Ord. O-03-10-2 § 1, 2003; Ord. O-03-01-6 § 1, 2003; Ord. O-01-4-2 § 2, 2001; Ord. O-96-5-6, 1996; Ord. O-93-6-6 § 1 (part), 1994)

17.10.030 Exemptions.2

(a) Gross receipts deriving from transactions in the following categories shall be exempt from sales taxation upon presentation of reasonable identification by the buyer:

(1) Retail sales and rentals of goods and services directly to a municipality, a state, or the United States government;

(b) Gross receipts deriving from transactions in the following categories shall be exempt from sales taxation upon presentation by the buyer of a valid exemption certificate and reasonable identification:

(1) Retail sales and rentals of goods or services except the rental of hotel or motel rooms directly to a nonprofit religious, charitable, cemetery, hospital or educational entity, and used exclusively for nonprofit religious, charitable, cemetery, hospital or educational purposes;

(c) A retail sale or rental of goods or services described in subsection (b) of this section, from which the otherwise exempt buyer derives income, is exempt only if that income is solely from use of the goods and services by nonprofit religious, charitable, hospital or educational groups for classroom space. (Ord. O-12-09-02 § 3, 2012: Ord. O-00-6-2 § 3, 2000: Ord. O-93-6-6 § 1 (part), 1994)

17.10.040 Tax based on selling price.

The seller shall apply the applicable sales tax percentage to the selling price and add the amount of the sales tax to the sale or rental price. The tax shall be stated separately on all invoices, receipts and other documents of the sale. (Ord. O-06-09-07 § 2, 2006: Ord. O-03-07-2 § 3, 2003: Ord. O-93-6-6 § 1 (part), 1994)

17.10.050 Application for exemption.

(a) Except for entities listed in NCO Section 17.10.030(a)(1), no exemption may be granted except upon written application for the exemption on a form supplied by the assessor. The claimant must file the application no later than December 1st prior to the calendar year for which the exemption is sought, but during the same year the city council for good cause shown may waive the claimant’s failure to make timely application for the exemption for that year and authorize the assessor to accept the application as if timely filed. The claimant must file a separate application for each calendar year in which the exemption is sought. If an application is filed within the required time and is approved by the assessor, he or she shall allow an exemption in accordance with the provisions of NCO Section 17.10.030. If a claimant whose failure to file by December 1st has been waived as provided in this subsection and the application for exemption is approved, the amount of tax which the claimant has already paid for the calendar year on exempt sales shall be refunded to him or her.

(b) The city clerk or the clerk’s designee, hereinafter referred to as the assessor, shall have the authority to initially determine whether a sale is exempt from tax. The assessor may at any time require proof, in the form he or she considers necessary, of the grounds for the exemption and the amount of the exemption claimed under this section. The claimant shall have the burden of establishing his or her qualifications for an exemption, and the exemption ordinance and statutes shall be strictly construed. (Ord. O-16-10-08 § 1, 2016; Ord. O-12-09-02 § 4, 2012: Ord. O-07-04-01 § 2, 2007; Ord. O-93-6-6 § 1 (part), 1994)

17.10.060 Sales tax licensing.

(a) No person, other than a remote seller subject to Chapter 17.15 NCO, may engage in any retail sales transaction as a seller within the city without first procuring either:

(1) An annual sales tax license from the office of the city clerk; or

(2) A transient merchant license under Chapter 3.15 NCO; or

(3) An annual motor bus, chauffeur’s, or taxicab license under Chapter 3.10 NCO.

(b) An application for a sales tax license shall include the name of the applicant; the mailing, residential, and business addresses of the applicant; certification by the applicant that he or she has not had any business license or tax license suspended or revoked within six months prior to the date of the application; proof of compliance with all state and federal licensing and registration requirements; and such other information as the city clerk may deem reasonably necessary for the proper administration of this chapter. The information contained in the application shall be submitted under oath or affirmation of the applicant.

(c) No sales tax license shall be issued to or renewed for a person who is required to have a state business license registration or permit, until that applicant submits evidence (1) that he or she has in his or her possession, or has applied for, the state business license, registration or permit; and (2) that all license, registration and permit fees have been paid current. A licensee, registrant or permittee whose fee falls due annually shall have thirty days after the due date in which to submit proof that the state license, registration or permit has been obtained. No sales tax license may be issued to or renewed for a person owing a judgment, delinquent taxes, or a utility bill to the city, except by terms and conditions established in each such case by the city manager.

(d) The license shall be renewed annually by February 1st upon completion of a renewal form as provided by the city clerk. The sales tax license shall be nontransferable. (Ord. O-20-02-01 § 3, 2020: Ord. O-12-09-02 § 5, 2012: Ord. O-00-11-E § 2, 2000; Ord. O-93-6-6 § 1 (part), 1994)

17.10.071 Amended returns.

(a) A seller may file with the city an amended sales tax return with supporting documentation, and the city clerk may accept the amended return, but only in the following circumstances:

(1) The original return was filed by the due date;

(2) The amended return is filed within one year of the original due date for the return;

(3) The seller provides a written justification for amending the return; and

(4) The seller held a current city sales tax license for the period for which the amended return was filed.

(b) The city clerk shall notify the seller in writing whether the city accepts or rejects an amended return, including the reasons for any rejection. (Ord. O-12-09-02 § 7, 2012)

17.10.080 Remittance of tax.

(a) A full remittance of all sales tax levied shall be due and owing from the seller to the city on the twentieth day of the month succeeding the end of the calendar month of the taxable transaction, whether or not the same tax has been collected from the buyer.

(b) A person doing business within the city who has obtained or is required to obtain a daily transient merchant license under NCO Section 3.15.030(a) shall file a sales tax return and remit in full the tax due within twenty-four hours following the expiration of the license. (Ord. O-20-02-01 § 5, 2020: Ord. O-19-08-01A § 2, 2019; Ord. O-12-09-02 § 9, 2012; Ord. O-93-6-6 § 1 (part), 1994)

17.10.082 Repayment plans.

(a) The city may agree to enter into a repayment plan with a delinquent seller. No repayment plan shall be valid unless agreed to by both parties in writing.

(b) A seller shall not be eligible to enter into a repayment plan with the city if the seller has defaulted on a repayment plan in the previous two calendar years.

(c) The repayment plan shall include a secured promissory note that substantially complies with the following terms:

(1) The seller agrees to pay a minimum of ten percent down payment on the tax, interest and penalty amount due. The down payment shall be applied first to penalty, then to accumulated interest, and then to the tax owed.

(2) The seller agrees to pay the balance of the tax, penalty and interest owed in monthly installments over a period not to exceed two years.

(3) Interest at a rate of fifteen percent per annum shall accrue on the principal sum due. Interest shall not apply to penalties owed or to interest accrued at the time the repayment plan is executed or accruing during the term of the repayment plan.

(4) If the seller is a corporation or a limited liability entity the seller agrees to provide a personal guarantee of the obligations under the repayment plan.

(5) The seller agrees to pay all future tax bills in accordance with the provisions of this chapter.

(6) The seller agrees to provide a security interest in the form of a sales tax lien for the entire unpaid balance of the promissory note to be recorded by the city at the time the repayment plan is signed. The seller shall be responsible for the cost of recording the tax lien.

(d) If a seller fails to pay two or more payments as required by the repayment plan agreement, the seller shall be in default and the entire amount owed at the time of default shall become immediately due. The city clerk will send the seller a notice of default. The city may immediately foreclose on the sales tax lien or take any other remedy available under the law. (Ord. O-20-02-01 § 8, 2020)

17.10.085 Use of information on sales tax returns.

(a) Except as otherwise provided in this chapter, all returns, reports and information required to be filed with the city under this chapter, and all information contained therein, shall be kept confidential and shall be subject to inspection only by:

(1) Employees and agents of the city whose job responsibilities are directly related to such returns, reports and information;

(2) The person supplying such returns, reports and information; and

(3) Persons authorized in writing by the person supplying such returns, reports and information.

(b) The city clerk will release information described in subsection (a) of this section pursuant to subpoena, order of a court or administrative agency of competent jurisdiction, and where otherwise required by law to do so.

(c) Notwithstanding subsection (a) of this section, the following information is available for public inspection:

(1) The name and address of a person who holds a current city sales tax license; and

(2) Whether a holder of a city sales tax license is more than thirty days delinquent in filing a return or remitting sales tax; and, if so, the number of returns not filed.

(d) Notwithstanding subsection (a) of this section, the city clerk may publish the name of any seller that is delinquent in remitting sales tax, and the amount of the delinquent tax unless the city has received written notice from the seller establishing the existence of a good faith dispute regarding either the existence of or the amount of a delinquency. The city clerk also may provide to the public statistical information related to sales tax collections; provided, that no information identifiable to a particular seller is disclosed. (Ord. O-12-09-02 § 10, 2012)

17.10.090 Termination, sale or transfer of retail business.

(a) A seller who sells, transfers or assigns a substantial portion of his or her retail business interest to another person shall make a final sales tax return within twenty days after the date of said conveyance. The purchaser of the business shall withhold a portion of the purchase money sufficient to pay any sales tax, penalties and interest which may be due, unless the seller displays a receipt from the city clerk showing that all tax obligations imposed by this chapter have been paid in full. Any purchaser of a business who fails to withhold said moneys due and owing to the city shall be personally liable for said taxes, penalties and interest owed by the seller to the city.

(b) A seller who terminates his business without the benefit of a purchaser, successor or assign, shall make a final tax return and settlement of tax obligations within fifteen days of said termination.

(c) Any person who has filed a sales tax return shall be presumed to be making sales in succeeding months unless he or she files a subsequent return declaring the termination or sale of the retail business. (Ord. O-93-6-6 § 1 (part), 1994)

17.10.100 Penalties and interest.

(a) A penalty of five percent of the sales tax due and owing shall be added to the tax for the first month or fraction thereof of delinquency or failure to file a sales tax return with the information required under NCO Section 17.10.015, and an additional five percent of the sales tax due and owing shall be added to the tax for subsequent months until a maximum penalty of twenty percent has been accrued. Any surcharge required by AS 12.55.039 shall also be imposed. The filing of an incomplete return shall be treated as the filing of no return.

(b) In addition to penalties, interest shall accrue on the principal amount of the delinquent tax at the rate of fifteen percent per annum from the date of the delinquency until paid.

(c) Regardless of whether any taxes were due, the penalty for late filing of the sales tax return shall be twenty-five dollars.

(d) Penalties and interest shall be assessed and collected in the same manner as the sales tax is assessed and collected.

(e) A penalty assessed under this section for the delinquent remittance of sales tax or failure to file a sales tax return may be waived by the city clerk, upon written application of the seller accompanied by a payment of all delinquent sales tax, interest and penalty otherwise owed, within forty-five calendar days after the date of delinquency. A seller may not be granted more than one waiver of penalty under this subsection in any one calendar year. (Ord. O-20-02-01 § 7, 2020: Ord. O-12-09-02 § 11, 2012: Ord. O-01-11-1 § 2, 2001: Ord. O-99-1-8 § 2, 1999: Ord. O-99-11-3 § 34, 1998: Ord. O-93-6-6 § 1 (part), 1994)

17.10.105 Application of sales tax payments.

(a) Payments on sales tax accounts shall be applied to the amount due for each reporting period, in chronological order, and within the amount due for each reporting period first to accrued penalty, second to accrued interest and then to sales tax payments owed by the seller.

(b) Amounts of delinquent sales tax, interest or penalty that have been reduced to judgment, are the subject of a confession of judgment, or are the subject of a written payment agreement between the city clerk and the seller are payable as provided in the judgment, confession of judgment or payment agreement, respectively, and, except as provided otherwise in the judgment, confession of judgment or payment agreement, thereafter cease to be subject to the further accrual of interest or penalty under this chapter. (Ord. O-12-09-02 § 12, 2012)

17.10.110 Estimated tax.

(a) If a seller fails to file a sales tax return, or if the city clerk has reasonable cause to believe that any information on a sales tax return is not accurate, the city clerk may estimate the sales tax due based on any information available.

(b) The city shall notify the seller in writing that the city clerk has estimated the amount of sales tax that is due from the seller, stating the estimated amount. The city shall serve the notice on the seller by delivering the notice to the seller’s place of business, or by mailing the notice by certified mail, return receipt requested, to the seller’s last known mailing address.

(c) The city’s estimate of the amount of sales tax that is due from a seller shall become a final determination of the amount that is due unless the seller, within fifteen days after service of notice of the estimated sales tax, gives the city a written request for a hearing.

(d) A hearing requested under subsection (c) of this section shall be conducted before the city manager, or the city manager’s designee, who may be a city employee or independent contractor. At the hearing, the seller shall have the burden of proving, by testimony or documentary evidence, that the amount of sales tax that is due is less than the amount that the city estimated. After the hearing, the person conducting the hearing shall issue a written decision determining the amount of sales tax that is due from the seller. The city shall serve the decision on the seller by delivering the notice to the seller’s place of business, or by mailing the notice by certified mail, return receipt requested, to the seller’s last known mailing address.

(e) A decision under subsection (d) of this section determining the amount of sales tax that is due may be appealed to the city council by filing written notice of appeal with the city clerk no later than ten days after receipt of the decision of the city manager. The appeal hearing before the city council shall be held no later than thirty days after receipt of the notice of appeal and will be conducted in accordance with the procedures of NCO Sections 17.20.060 and 17.20.070.

(f) A decision of the city council may be appealed to the superior court as provided in the Alaska Rules of Appellate Procedure.

(g) The amount of sales tax finally determined to be due under this section shall bear interest and penalty as provided in NCO Section 17.10.100, from the date that the sales tax originally was due. If the amount determined to be due under this section is less than the amount previously remitted by the seller, the city shall refund the difference plus interest in the amount set forth in NCO Section 17.10.100 calculated from the date of receipt of payment from the seller. (Ord. O-12-09-02 § 13, 2012)

17.10.120 Tax evasion.

Any person who fails to file a statement required by this chapter or Chapter 17.15 NCO, or who makes a false affidavit of the amount, location, kind or value of property subject to sales taxation, with intent to evade the taxation, is guilty of a misdemeanor. Upon conviction, he or she is punishable by a fine of not more than one thousand dollars plus any surcharge required to be imposed by AS 12.55.039, or by imprisonment for not more than ninety days, or by both, together with the costs of prosecution. (Ord. O-20-02-01 § 9, 2020: Ord. O-99-11-3 § 35, 1998: Ord. O-93-6-6 § 1 (part), 1994)

17.10.130 Tax audits.

(a) The assessor is not bound to accept a sales tax return as correct. He or she may make an independent investigation of all retail sales transactions. In such case, the assessor may make his or her own valuation of the taxable property, which shall be prima facie evidence in a court of law.

(b) For the conduct of an investigation, the assessor or his or her agent may enter any premises during reasonable hours, and may examine all books, records and other documents and property that may reasonably lead to the discovery of evidence of retail sales transactions. A person shall, upon request, furnish to the assessor or his or her agent every facility and assistance for the purposes of the investigation.

(c) An assessor may examine a person on oath. Upon request during reasonable hours, the person shall present himself or herself for examination by the assessor.

(d) Each seller liable to collect and pay sales tax shall maintain for a period of six years all books, records and other documents containing evidence of retail sales transactions, and shall produce any and all said books, records and other documents for examination and inspection at any reasonable time by the assessor.

(e) In the event the assessor, upon completion of an audit, discovers more than five hundred dollars in additional sales taxes due from a merchant resulting from a merchant’s failure to accurately report sales and taxes due thereupon, the merchant will bear responsibility for the cost of the audit. The audit fee assessment will be in addition to interest and penalties applicable to amounts deemed to be delinquent by assessor at the time of the conclusion of the audit but shall not exceed one thousand dollars.

(f) A merchant may appeal audit assessments and penalties. The appeal will be conducted in a manner that is consistent with the appeal procedures set forth in NCO Sections 17.10.110(d) and (e). (Ord. O-20-02-01 § 10, 2020: Ord. O-12-09-02 § 14, 2012; Ord. O-93-6-6 § 1 (part), 1994)

17.10.150 Tax liens interest.

(a) The tax, interest, penalties and other costs due and owing under this chapter shall constitute a lien of the city upon the assets or property of the delinquent seller.

(b) A notice of lien for amounts described in subsection (a) of this section may be filed in the office of the district recorder, Nome recording district, second judicial district; however failure to so record said interests shall not be construed as a waiver or abrogation of any and all priorities, rights and interests of the city at law and in equity. Upon full satisfaction of payment of all taxes, interest, penalties and costs due and owing to the city, the assessor shall file a certificate discharging the lien. (Ord. O-93-6-6 § 1 (part), 1994)

17.10.160 Enforcement remedies.

(a) Each of the following is a violation of this chapter:

(1) A seller engaging in retail sales without obtaining or renewing a valid sales tax license.

(2) A buyer failing to pay sales tax to a seller as required by this chapter.

(3) A seller failing to collect sales tax from a buyer as required by this chapter.

(4) A seller failing to file a sales tax return or remit sales tax when due.

(5) A buyer or seller knowingly submitting false information in a document filed with the city under this chapter.

(6) A seller falsifying or concealing information related to its business activities in the city for the purpose of avoiding payment of sales tax.

(7) A seller failing to permit the city to inspect records of the seller as required by this chapter.

(8) A seller failing to maintain records as required by this chapter.

(9) A buyer giving false information when applying for a certificate of exemption, or using a certificate of exemption in a transaction that was not exempt from sales tax under the exemption for which the certificate was issued.

(10) A seller failing to notify a transferee of the seller’s business of the transferee’s withholding obligation under NCO Section 17.10.090.

(11) A person causing or permitting a corporation of which the person is an officer or director, a limited liability company of which the person is a member or manager, or a partnership of which the person is a partner, to commit a violation of this chapter described in subsections (a)(1) through (10) of this section.

(b) A person who is convicted of a violation of this chapter is guilty of an infraction and shall be subject to a fine of not more than five hundred dollars plus any surcharge required to be imposed by AS 29.25.074.

(c) Each act or omission in violation of this chapter, and each month in which the act or omission occurs, is a separate violation of this chapter.

(d) A seller that fails to file a sales tax return or remit sales tax when due, in addition to any other liability therefor imposed by this chapter, shall pay to the city all costs incurred by the city to determine the amount of the seller’s sales tax liability or to collect the sales tax, including without limitation costs of obtaining, reviewing and auditing the seller’s business records, collection agency fees, and actual reasonable attorney’s fees.

(e) A person who causes or permits a corporation of which the person is an officer or director, a limited liability company of which the person is a member or manager, or a partnership of which the person is a partner, to fail to collect sales tax or to remit sales tax to the city as required by this chapter shall be liable to the city for the amount that should have been collected or remitted, plus any applicable interest and penalty.

(f) Pursuant to AS 29.45.650 there is created a lien on the real and personal property of a seller to secure the payment of sales tax, interest, penalty and costs of collection. The city clerk shall cause notice of the lien to be recorded with respect to the property of a seller when the city clerk finds that the seller is delinquent in remitting sales tax to the city. The notice shall state the name of the seller; the amount of delinquent sales tax, interest, penalty and cost of collection owed by the seller as of a specified date; and that interest, penalty and costs will continue to accrue until payment is made. Within ten days after recording the notice, city shall mail a copy of the notice by certified mail, return receipt requested, to the last known address of the seller; provided, that failure of the seller to receive it shall not affect the validity or priority of the lien.

(g) The city may bring a civil action to:

(1) Enjoin a violation of this chapter. On application for injunctive relief and a finding of a violation or threatened violation, the superior court shall enjoin the violation;

(2) Collect delinquent sales tax, penalty, interest and costs of collection, either before or after estimating the amount of sales tax due under NCO Section 17.10.110;

(3) Recover a civil penalty of not less than three hundred dollars and not more than one thousand dollars for each violation of this chapter; and

(4) Foreclose a recorded sales tax lien as provided by law.

(h) All remedies for violations of this chapter are cumulative and are in addition to any others existing at law or in equity. (Ord. O-14-01-02 § 41, 2014; Ord. O-12-09-02 § 15, 2012)

17.10.170 Situs of taxable transaction.

(a) Whenever any element or constituent part of a retail sale or rental of goods or services occurs in the city, the transaction shall be construed as occurring in the city for tax purposes except as provided in this section.

(b) Sales and rentals of goods and services resulting from orders received from a buyer outside the city by mail, telephone or other similar public modes of communications shall not be construed as a taxable transaction if delivery of the ordered goods to the buyer is made outside the city by mail or common carrier, or if the performance of the service ordered occurs wholly outside the city.

(c) If a service is performed both inside and outside of the city, that fractional portion of the service performed outside the city shall be excepted from taxation, except that the full selling price of the service shall be taxed if the service commences and terminates in the city.

(d) Nothing in this section is intended to create a taxable transaction if the goods sold or rented do not reside, or have never been within, the city of Nome’s boundaries, and there is no intention for the goods to ever enter into city boundaries. (Ord. O-20-02-01 § 11, 2020; Ord. O-19-08-01A § 3, 2019: Ord. O-12-09-02 § 17 (part), 2012; Ord. O-93-6-6 § 1 (part), 1994)

17.10.175 Resale certificate.

(a) No sale will be considered a “sale for resale without alteration” for purposes of taxation under this chapter and Chapter 17.15 NCO unless, at the time of sale, the buyer presents the seller with a valid city resale certificate applicable to the good or service purchased.

(b) Any person may apply for a resale certificate by submitting an application on a form prepared by the city clerk together with an application fee of one-hundred fifty dollars. The form shall contain the following information:

(1) Name of applicant;

(2) Identification of the good or service the applicant intends to resell without alteration;

(3) Copy of the applicant’s city sales tax certificate;

(4) Description of the manner in which the good or service will be resold;

(5) Such other and further information reasonably requested by the city clerk.

(c) Upon receipt of a complete application, the city clerk or the clerk’s designee shall grant or deny the application in whole or in part within five business days from the date the application was submitted.

(d) Any applicant whose application is denied may appeal the denial to the city manager. The appeal shall be made in writing, state the reasons therefore and shall be submitted within ten calendar days fro the date of issuance of the city clerk’s decision.

(e) The city manager shall issue a written decision on an appeal no later than twenty calendar days from the date of receipt of the appeal. The city manager’s decision shall be final.

The applicant may appeal the city manager’s decision by filing a written notice of appeal with the Superior Court for the Second Judicial District of Nome, in accordance with court rules for administrative appeals. Any appeal must be filed no later than thirty days from the date of issuance of the city manager’s decision.

(f) The city clerk may issue regulations regarding resale certificates. Such regulations shall be approved by the city council by resolution.

(g) Resale certificates shall expire the end of each calendar year unless renewed. The renewal application fee shall be one-hundred fifty dollars. A renewal application shall identify any information that has changed since the date of the previous application. The city clerk may require submission of additional information with a renewal application. (Ord. O-20-02-01 § 12, 2020; Ord. O-12-09-02 § 16, 2012; Ord. O-03-07-1 § 3, 2003. Formerly 17.10.190)

17.10.180 Definitions.

For purposes of this chapter and Chapter 17.15 NCO, the following words and phrases shall have the meanings respectively ascribed to them in this section:

“ATV” or “off-highway vehicle” or “all-terrain vehicle” means a vehicle designed or adapted for cross-country operation over unimproved terrain, ice or snow, and which has been declared by its owner at the time of registration and determined by the Department of Motor Vehicles to be unsuitable for general highway use, although the vehicle may make incidental use of a highway as provided by state law; it does not include implements of husbandry and special mobile equipment.

“Buyer” means a person to whom a sale of property or product is made or to whom a service is furnished.

“Charitable” means an entity eligible under the Internal Revenue Code to receive tax-deductible donations (e.g., 501(c)(3) and volunteer fire company or veteran organization 501(c)(4)).

“Child care” means a regular service of care and education provided for compensation for any part of a day less than twenty-four hours to a child or children under sixteen years of age whose parents work outside the home, attend an educational program or are otherwise unable to care for their children.

“Common carrier” means an individual or a company, which is in the regular business of transporting freight for hire. This is distinguished from a private carrier which transports its own goods and equipment and makes deliveries of goods sold to its customers.

“Construction materials” means an item of tangible personal property that is used to construct or renovate a building, a structure, or an improvement on land and that typically loses its separate identity as personal property once incorporated into the real property. “Construction material” includes building materials, building systems equipment, landscaping materials, and supplies.

“Dues, membership and subscription” means monies paid for the purpose of membership, or qualifying or becoming eligible for goods or services, or discounts to goods or services.

“Food” means any food or food product for home consumption except alcoholic beverages, tobacco, and prepared food. Food or food products include property, whether in liquid, concentrated, solid, frozen, dried, or dehydrated form, that is sold for ingestion or chewing by humans and is consumed for its taste or nutritional value.

“Food stamps” means obligations of the United States government issued or transferred by means of food coupons or food stamps to enable the purchase of food for the eligible household.

“Gaming” means any game defined in AS 05.15.690, as amended or renumbered.

“In-state” means in the state of Alaska, and as applied to sale means any sale where the buyer receives custody, control, access to, or use of the goods in the state and where the buyer receives a service, or the benefit of a service, in the state.

“Loan” means an extension of credit resulting from direct or indirect negotiations between a lender and a debtor.

“Marketplace” is a physical or electronic setting, including, but not limited to, a store, a booth, an internet website or exchange, catalog, or software application, where goods or services are offered for sale. A marketplace does not include the digital network, as defined by AS 28.23.180, of a transportation network company.

“Marketplace facilitator” means a person that contracts with remote sellers to facilitate for consideration, regardless of whether deducted as fees from the transaction, the sale of the remote seller’s property or services through a physical or electronic marketplace operated by the person, and engages:

(1) Directly or indirectly, through one or more affiliated persons, in any of the following:

(A) Transmitting or otherwise communicating the offer or acceptance between the buyer and remote seller;

(B) Owning or operating the infrastructure, electronic or physical, or technology that brings buyers and remote sellers together;

(C) Providing a virtual currency that buyers are allowed or required to use to purchase products from the remote seller; or

(D) Software development or research and development activities related to any of the activities described in subsection (2) of this definition, if such activities are directly related to a physical or electronic marketplace operated by the person or an affiliated person; and

(2) In any of the following activities with respect to the seller’s products:

(A) Payment processing services;

(B) Fulfillment or storage services;

(C) Listing products for sale;

(D) Setting prices;

(E) Branding sales as those of the marketplace facilitator;

(F) Order taking;

(G) Advertising or promotion; or

(H) Providing customer service or accepting or assisting with returns or exchanges.

“Marketplace seller” means a seller who uses a marketplace to facilitate a sale.

“Medical prescriptions” or “prescription medicines” means all medicines prescribed by a health care provider licensed to practice in Alaska or any other state in the United States.

“Medical services” means those professional services rendered by persons duly licensed under the laws of this state to practice medicine, surgery, chiropractic, podiatry, dentistry, and other professional services rendered by a licensed midwife, certified registered nurse practitioners, and psychiatric and mental health nurse clinical specialists, and appliances, drugs, medicines, supplies, and nursing care necessary in connection with the services, or the expense indemnity for the services, appliances, drugs, medicines, supplies, and care, as may be specified in any nonprofit medical service plan. “Medical services” include hospital services.

“Merchandise” means tangible personal property offered for consideration by a seller.

“Merchandise acquired for resale” means merchandise purchased for the purpose of selling in an unaltered form to another buyer on a retail basis.

“Merchant” means an individual or organization engaged in the sale of tangible personal property.

“Monthly” means occurring once per calendar month.

“Motor vehicle” or “automobile” means a motor vehicle, as defined in AS 28.90.990(17), that is either required to be registered under AS 28.10.011, or is exempted from registration under AS 28.10.011(6) and (11). However, “motor vehicle” does not include either an “off-highway vehicle” as defined in 13 AAC 40.010(a)(30) or a “snowmobile” as defined in 13 AAC 40.010(a)(49). “Motor vehicle” includes parts for a motor vehicle.

“Newspaper” means a publication of general circulation bearing a title, issued regularly at stated intervals at a minimum of not more than two weeks, and formed of printed paper sheets without substantial binding. It must be of general interest, containing information of current events. The word does not include publications devoted solely to a specialized field. It shall include school newspapers, regardless of the frequency of the publication, where such newspapers are distributed regularly to a paid subscription list.

“Nonprofit organization” means a business that has been granted tax-exempt status by the Internal Revenue Service (IRS); means an association, corporation, or other organization where no part of the net earnings of the organization inures to the benefit of any member, shareholder, or other individual, as certified by registration with the IRS.

“Periodical” means any bound publication other than a newspaper that appears at stated intervals, each issue of which contains news or information of general interest to the public, or to some particular organization or group of persons. Each issue must bear a relationship to prior or subsequent issues with respect to continuity of literary character or similarity of subject matter, and sufficiently similar in style and format to make it evident that it is one of a series.

“Person” means an individual, trust, estate, fiduciary, partnership, limited liability company, limited liability partnership, corporation, or any other legal entity.

“Physical presence” means a seller who establishes any one or more of the following within a local taxing jurisdiction:

(1) Has any office, distribution or sales house, warehouse, storefront, or any other place of business within the boundaries of the local taxing jurisdiction;

(2) Solicits business or receiving orders through any employee, agent, salesman, or other representative within the boundaries of the local taxing jurisdiction or engages in activities in this state that are significantly associated with the seller’s ability to establish or maintain a market for its products in this state;

(3) Provides services or holds inventory within the boundaries of the local taxing jurisdiction;

(4) Rents or leases property located within the boundaries of the local taxing jurisdiction.

A seller that establishes a physical presence within the local taxing jurisdiction in any calendar year will be deemed to have a physical presence within the local taxing jurisdiction for the following calendar year.

“Property” and “product” mean both tangible property, an item that can be seen, weighed, measured, felt, or touched, or that is in any other manner perceptible to the senses; and intangible property, anything that is not physical in nature (i.e., intellectual property, brand recognition, goodwill, trade, copyright and patents).

“Quarter” means trimonthly periods of a calendar year; January-March, April-June, July-September, and October-December.

“Remote seller” means a seller or marketplace facilitator making sales of goods or services delivered within the state of Alaska, without having a physical presence in a taxing jurisdiction, or conducting business between taxing jurisdictions, when sales are made by internet, mail order, phone or other remote means. A marketplace facilitator shall be considered the remote seller for each sale facilitated through its marketplace.

“Rental” means allowing the use of tangible personal or real property for a specified length of time.

“Resale of services” means sales of intermediate services to a business the charge for which will be passed directly by that business to a specific buyer.

“Retail sales transaction” or “sale” or “retail sale” means any transfer of property for consideration for any purpose other than for resale and includes the sale, lease, rental transfer or assignment of any right, title or interest in any goods, personal property or real property and any provision of labor or services, for valuable consideration, for any purpose except resale without alteration by a buyer presenting a resale certificate issued pursuant to NCO Section 17.10.175 applicable to the sales or service transaction. In determining whether an item or service is being purchased for resale without alteration in the regular course of the business of the buyer, the vendor shall be responsible to: (1) require the buyer to present the valid resale certificate and (2) verify that the resale certificate applies to the good or service being purchased (make a diligent inquiry into the purpose of the purchase by the buyer), and shall be held to the standard of inquiry expected of a reasonable and prudent person under similar circumstances acting in good faith toward the taxing authority.

“Seller” means every person making sales of property, products, or services, or a marketplace facilitator facilitating sales on behalf of a seller.

“Selling price,” “sales” or “purchase price” means the total amount of consideration, including cash, credit, property, products, and services, for which property, products, or services are sold, leased, or rented, valued in money, whether received in money or otherwise, without any deduction for the following:

(1) The seller’s cost of the property or product sold;

(2) The cost of materials used, labor or service cost, interest, losses, all costs of transportation to the seller, all taxes imposed on the seller, and any other expense of the seller;

(3) Charges by the seller for any services necessary to complete the sale, other than delivery and installation charges;

(4) Delivery charges;

(5) Installation charges; and

(6) Credit for any trade-in, as determined by state law.

“Services” means all services of every manner and description that are performed or furnished for valuable consideration whether in conjunction with the sale of goods or not, but does not include services rendered by an employee to an employer.

“Taxable sale” means:

(1) All sales for which an exception has not been established pursuant to NCO Section 17.10.020.

(2) All sales for which an exemption has not been granted pursuant to NCO Section 17.10.030.

“Taxing jurisdiction” means a local government in Alaska that has a sales tax and is a member of the Alaska Remote Sellers Sales Tax Commission.

Used Exclusively for Religious Purposes. Retail sales and rentals of goods and services “used exclusively for religious purposes” means only goods, services or rentals which are used for, consumed in, or rendered only for the construction, alteration, maintenance, repair or outfitting of the following described property legally possessed by and used exclusively by a religious organization: the residence of a bishop, pastor, priest, rabbi, minister or religious order of a recognized religious organization; a structure, its furniture and its fixtures used solely for public worship, charitable purposes, religious administrative offices, religious education or a nonprofit hospital; lots supporting and adjacent to a structure or residence mentioned above in this subsection, which are necessary to convenient use of said structure or residence; and lots required by city ordinance for parking near a structure used solely for public worship, charitable purposes, religious administrative offices, religious education or a nonprofit hospital. (Ord. O-20-02-01 § 13, 2020: Ord. O-19-08-01A § 4, 2019: Ord. O-19-01-07 § 2, 2019: Ord. O-12-09-02 § 17 (part), 2012; Ord. O-03-07-1 § 2, 2003; Ord. O-93-6-6 § 1 (part), 1994)

17.10.200 Regulations.

The city manager may adopt, amend and repeal regulations to implement, interpret or make specific the provisions of this chapter, or prescribe forms to be used under this chapter. (Ord. O-12-09-02 § 18, 2012)


1

Code reviser’s note: Ordinance O-12-09-02 inadvertently included provisions from Ordinance 05-10-01 that had sunset pursuant to the terms of that ordinance. The provisions have been removed from the code pursuant to the intent of the city.


2

Code reviser’s note: Ordinance O-12-09-02 inadvertently included provisions from Ordinance 05-10-01 that had sunset pursuant to the terms of that ordinance. The provisions have been removed from the code pursuant to the intent of the city.