If cruise ship passengers stop in Ketchikan next year, they’re likely to pay an extra $2 in head taxes.
Last year, the Ketchikan City Council decided to raise its local cruise ship head taxes, effective next April. And that raised a question about a tax break the cruise industry gets from a state cruise ship head tax.
The state collects up to $34.50 per passenger. But it’s variable, depending on if a given ship stops in Juneau or Ketchikan. If it does, the taxes due to the state are supposed to be reduced by the amount those cities collect.
State revenue officials say the law about this tax reduction freezes that tax break at 2007 rates. That is, the tax break isn’t supposed to change if local head taxes change. They’re proposing a regulation to clarify that.
Mike Tibbles with the industry group Cruise Lines International Association Alaska said that fits his understanding of the law. He said the proposed regulation isn’t a substantive change.
The public comment period on the proposed regulation was originally set to expire Monday. Revenue officials extended it to Nov. 12 after getting questions and comments about it.
Juneau first started collecting cruise ship head taxes in 2000, followed by Ketchikan and the state. The taxes have paid for hundreds of millions of dollars in waterfront improvements and services related to the industry.
