A package of sales tax recommendations that could take a big bite out of the city’s anticipated $7.2 million budget deficit is headed for public hearing.
The Juneau Assembly’s Tax Exemption Review Committee completed its six-month examination of municipal tax breaks Thursday.
The committee recommends:
- Raising the maximum taxable value of big ticket items from $7,500 to $14,000,
- Limiting the senior sales tax exemption to Juneau residents,
- Limiting the senior sales tax exemption to food, fuel and electricity,
- And limiting the senior sales tax exemption on all other goods to seniors with incomes below 250 percent of the federal poverty level.
The recommendations were made piecemeal. Deputy Mayor Mary Becker chaired the committee and noted the recommendations don’t constrain the Assembly’s policymaking authority.
One proposal the committee did not recommend was raising the age of eligibility for the senior sales tax exemption from 65 to 70 over five years.
“I would certainly not personally agree to that because I think it is a double whammy,” Becker said referring to the combination with the other changes to the senior sales tax exemption. “I think one or the other is fine with me.”
Assemblywoman Kate Troll said she saw it as a double break.
“They get two good benefits. Instead of eliminating the exemption altogether, we’re keeping it on essentials, we’re making it needs based,” Troll said.
Assemblyman Jesse Kiehl argued that people are living longer, healthier and many are choosing to continue working past age 65.
“And so some limited shift to reflect the realities of the world we live in I think is good tax policy, because it keeps, it keeps us in line with the economic realities of our age,” Kiehl said.
The recommendation, which the Juneau Commission on Aging supported, failed in a 2-2 vote. Assemblyman Jerry Nankervis was the other no vote.
Becker says she expects the Assembly’s Finance Committee to take up the recommendations after the public hearing scheduled for Jan. 8.
Editor’s note: An earlier version of this story referred to a $9.2 million budget deficit. That figure did not reflect $2 million in cuts and new revenue to be carried forward from the current budget year.
