New year, new senior sales tax

Ringing in the New Year for senior citizens in Juneau might mean ringing up a few items separately at grocery stores.

Starting today, an ordinance passed in September begins that will narrow the senior sales tax that has been in place since 1979, and only half of major grocers have updated systems prepared for the change.

City and Borough of Juneau sales tax administrator Clinton Singletary said Fred Meyer, Safeway and Costco have not yet updated their point of sale systems, so for the time being seniors will have to make two transactions when shopping — one for tax exempt items and another for those not exempt.

Super Bear Supermarket, Wal-Mart and Foodland IGA have systems that can single out exempt items in a single purchase. Breeze In can also handle exempt items in a single transaction.

Though the transactions might be different, the exemptions are the same across all stores. In accordance with the ordinance-only essentials, foods, electricity, heating fuel, City and Borough of Juneau water utilities and garbage collection, and landfill use will be tax exempt for all seniors.

The city predicts this change will net approximately $1 million per year in increased tax revenue. In a previous Empire article, it was reported the city loses $400,000 in tax revenue each year as more people become available for the exemption, according to CBJ Finance Director Bob Bartholomew.

Citizen demographics for Juneau show the percentage of senior citizens growing from 6 percent a few years ago to an estimated 18 percent in the span of five years.

Now, food purchases that qualify for the tax exemption must be Federal Food Stamp or Supplemental Nutrition Assistance Program (SNAP) exempt. These are strictly items that are for home consumption, which excludes items from places such as the Breeze In or Fred Meyer deli sections.

Singletary said city officials sent information packets to the 3,800 seniors with exemption cards explaining how “essential” items will be determined when grocery shopping.

“A frequent misunderstanding is about that word ‘essential,’” Singletary said. “People will call and say, ‘Well, isn’t such and such an essential?’ But it’s not that ‘essentials’ are being exempted, it’s essential foods and utilities.”

According to the U.S. Department of Agriculture SNAP assistance website: “You can use SNAP benefits to buy foods for the household to eat, such as breads and cereals, fruits and vegetables, meats, fish and poultry, dairy products. You can also use your benefits to buy seeds and plants which produce food for the household to eat.

“You cannot use SNAP benefits to buy beer, wine, liquor, cigarettes or tobacco; any nonfood items, such as pet foods, soaps, paper products and household supplies; vitamins and medicines; food that will be eaten in the store; and hot foods.”

Although all seniors will be required to pay sales tax for nonessential items, senior couples making less than $49,800 per year — or a single senior making less than $36,800 — will be eligible for a tax rebate based on income.

Rebates will be awarded once per year in September if a senior citizen has their tax exemption card issued by June 30 and does not have an income level exceeding 250 percent of the U.S. Poverty Guidelines for the State of Alaska.

Singletary said his office is ready and willing to answer all questions from concerned citizens. For more information contact the CBJ Finance Department and Sales Tax Division at 586-5265 or visit juneau.org.

• Contact reporter Paula Ann Solis at 523-2272 or at paula.solis@juneauempire.com.

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