By Melinda Munson
Skagway shoppers will enjoy a retail tax holiday from Oct. 1, 2021 to March 31, 2022. Resolution 21-28R, passed Sept. 16, waives the 3% winter sales tax.
“I think we’re trying to help people here in the winter as much as we can…” said Assemblymember Orion Hanson.
The tax holiday is a tradition in Skagway, though how it looks and when it happens varies. The assembly can vote by resolution to forego taxes on retail sales, services and/or rents. In 2020, there was no tax holiday. In 2019, the tax holiday ran from Oct. 1 to Dec. 31, for retail sales only.
“I’ve always appreciated this sales tax holiday,” said Assemblymember Deb Potter. “Especially last year, we all learned the importance of shopping local and supporting our local businesses…”
Skagway’s share of American Rescue Plan Act funds, around $9 million, an unexpected revenue replacement for the municipality, means the borough doesn’t have to pinch pennies after COVID-19 wiped out the 2020 tourist season and brought in under a tenth of normal traffic in 2021.
Jason O’Daniel, Skagway Ace Hardware employee, told KHNS, “100% some people will wait for doing some of those special orders” until the sales tax holiday takes effect.
In the coming weeks, Skagwegians might have a little extra cash to spend. Alaskans with direct deposit will start to receive their PFDs in mid October. This year’s amount is $1,100.
Supply issues, stemming from COVID-19, could be an obstacle for those hoping to shop local. A visit to the hardware store showed no Kitchen Aids in stock, and none available for future orders. Customers can special order large appliances, such as a fridge, but employees are hesitant to make promises for delivery dates.
The upstairs showroom was fully stocked, so shoppers without strict parameters can start saving their 3%. Retail sales tax will resume in April when it goes back to 5% for the summer months.