Alaska State Taxes

Quick Tax Facts

Income Tax: 0%
State Sales Tax: 0%
Median Property Tax: $2,422

Overview

Alaska is a great choice if you’re looking for a state that isn’t big on taxes. They don’t levy a state income tax, there’s no state sales tax, and property taxes are handled at the local level. There is, however, local sales taxes. Each year, permanent residents are also rewarded with a dividend payment (varies by year). For 2023, eligible residents received $1,312 each.

Alaska Income Tax

There is no personal state income tax in Alaska.

Alaska Sales Tax

Although Alaska’s state sales tax rate is 0%, each city and county can levy its own local sales tax. Currently, 107 municipalities levy a general sales tax between 1% and 7%. The average local sales tax rate is 1.76%. Other local taxes include:

Raw fish taxes
Hotel/motel taxes
Severance taxes
Liquor and tobacco taxes
Gaming taxes (pull tabs)
Fuel transfer taxes

The city of Ketchikan approved a seasonal increase to its sales tax rate to take advantage of summer tourism. Between April 1 and September 30, the city’s sales tax will increase to 5.5% and then drop to 3% between October 1 and March 31.

Alaska Property Taxes

Alaska has one of the highest average property tax rates in the country (ranked 13^th) at 1.04%, even though the state does not levy any property taxes. Instead, property taxes are handled at the local government level. Of the 19 boroughs in Alaska, only 4 do not levy property taxes. An additional nine cities located outside the boroughs also levy property taxes. The state does provide an exemption on the first $150,000 of assessed value, however, for senior citizens (65+) and disabled veterans (50% or more service-connected). Currently, the median property tax in Alaska is $2,422.

Alaska Property Tax
Highest	$3563
Median	$2422
Lowest	$678

Yearly Cost Per Resident

Alaska Tax Holidays

Several cities in Alaska host annual sales tax holidays and tax-free days. The list below is a sampling.

Kodiak Tax-Free Day. Held the first Saturday in March annually, all sales, rentals, and services made on this day are exempt from tax unless made by the city.
Ketchikan Sales Tax Holiday. The Ketchikan Borough Assembly recently agreed to add a second tax-free day for residents. Traditionally, the tax holiday is held in the fall when Permanent Fund dividends are distributed. Now, a second date in March will also give residents a tax break.
Skagway Sales Tax Holiday. Between October 1, 2023, and March 31, 2024, retail sales will be tax-free. Eligible sales must physically take place within the borough.